WASHINGTON — Upholding President Obama's promise to make 2014 a year of action to expand opportunity, reward work and grow the middle class, U.S. Secretary of Labor Thomas E. Perez today announced a final rule that raises the minimum wage for workers on federal service and construction contracts to $10.10 per hour. The final rule implements Executive Order 13658, which was announced by the president on Feb. 12, and it will benefit nearly 200,000 American workers.
"No one who works full time in America should have to raise their family in poverty, and if you serve meals to our troops for a living, then you shouldn't have to go on food stamps in order to serve a meal to your family at home," said Secretary Perez. "By raising the minimum wage for workers on federal contracts, we're rewarding a hard day's work with fair pay. This action will also benefit taxpayers. Boosting wages lowers turnover and increases morale, and will lead to higher productivity."
The final rule provides guidance and sets standards for employers concerning what contracts are covered and which of their workers are covered. The rule also establishes obligations that contractors must fulfill to comply with the minimum wage provisions of the executive order, including record-keeping requirements. It provides guidance about where to find the required rate of pay for all workers, including tipped employees and workers with disabilities. Additionally, the rule establishes an enforcement process that should be familiar to most government contractors and will protect the right of workers to receive the new $10.10 minimum wage.
Executive Order 13658 applies to new contracts and replacements for expiring contracts with the federal government that result from solicitations issued on or after Jan. 1, 2015, and to contracts that are awarded outside the solicitation process on or after Jan. 1, 2015. The minimum wage applicable under this final rule will be indexed to inflation in future years. The final rule makes clear that the executive order minimum wage requirement applies to all contracts for construction covered by the Davis-Bacon Act; contracts for services covered by the Service Contract Act; concessions contracts, such as contracts to furnish food, lodging, automobile fuel, souvenirs, newspaper stands and recreational equipment; and contracts to provide services, such as child care or dry cleaning, on federal property for federal employees or the general public. The final rule came after consideration of extensive comments from the federal contracting community, workers and other interested parties.
For more information about the final rule, including fact sheets and answers to frequently asked questions, please visit http://www.dol.gov/whd/flsa/eo13658/. The rule will be published on the Federal Register Oct. 7, and it is available at https://federalregister.gov/a/2014-23533.