President Obama to Raise Minimum Wage for Contractor Employees

As announced in the State of the Union Address, President Obama will issue an executive order raising the minimum wage for workers on federal contracts. The rate will increase to $10.10 an hour. As stated in a White House fact sheet posted January 28, the President also wants to work with Congress to pass the Harkin-Miller bill, which would raise the federal minimum wage to the same rate and in the future indexed for inflation.

The beneficiaries of the President’s order will be those who work on new government contracts for services and construction and are currently paid less than $10.10 an hour — including janitors, construction workers, and military base workers who wash dishes, serve food, and do laundry. According to the fact sheet, the wage boost for contract workers will provide good value for the federal government and taxpayers, lower turnover, increase morale, lead to higher overall productivity, and improve the quality and efficiency of services provided to the government.

The White House also states that the wage increase will be manageable for contractors because it will apply to new contracts after the effective date of the order, giving contractors time to prepare and price their bids accordingly.

About George Gullo

George Gullo is an attorney editor in the Government Contracts group at Wolters Kluwer Law and Business. George serves as the principal editor of Cost Accounting Standards Guide and supports all of the group’s print and electronic publications, as well as legal research tools, including the Government Contracts Reporter, Board of Contract Appeals Decisions, and the FAR and DFARS Matrix Smart Charts. With more than 20 years experience in the legal publishing industry, including over 10 years in the government contracts area, George also has a background in legal and business transactions. He is a graduate of DePaul University College of Law and a licensed Illinois attorney.
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