Government Contractor Minimum Wage Increase

The Department of Labor has approved raising the minimum wage for federal contract workers. Effective January 1, 2015 workers on federal service and construction contracts must be paid a minimum wage of $10.10 per hour. This rate will also be adjusted annually.

The new minimum wage rule will apply to most government contracts, subcontracts and contract-like instruments; such as those covered by the Service Contract Act (SCA) or the Davis-Bacon Act and:

  1. It is a procurement contract for services or construction;
  2. It is a contract or contract-like instrument for services covered by the Services Contract Act;
  3. It is a contract or contract-like instrument for concessions, including any concessions contract excluded by 29 C.F.R. § 4.133(b); or
  4. It is a contract or contract-like instrument entered into with the Federal Government in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public.

The new rule will apply to contracts for which a solicitation is first issued on or after January 1, 2015. If no solicitation issued, then it applies to contracts entered into on or after January 1, 2015 or contracts that have been modified in scope or that have been extended by negotiations on or after that date.

The Final Rule can be viewed by clicking the following link:

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