SMALL BUSINESS NEWS

Jan 2019

 

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Federal Contractors Have To Pay Higher Wages in 2019

Under Executive Order 13658 which took effect on January 1, 2015 federal contractors are required to pay their employees a higher minimum wage.  The annual increases in the minimum wage is tied to the Consumer Price Index (CPI). 

 

Hence, On September 4, 2018, the Department of Labor published a Notice in the Federal Register to announce that, beginning January 1, 2019, the Executive Order 13658 minimum wage rate is increased to $10.60 per hour (83 FR 44906).

 

This Executive Order minimum wage rate generally must be paid to workers performing work on or in connection with covered contracts. Additionally, beginning January 1, 2019, tipped employees performing work on or in connection with covered contracts generally must be paid a minimum cash wage of $7.40 per hour.

 

The order applies to Prime Contractors and sub-contractors alike.

 

The order shall apply only to a new contract or contract-like instrument such as:

 

- it is a procurement contract for services or construction;

 

- it is a contract or contract-like instrument for services covered by the Service Contract Act;

 

-  it is a contract or contract-like instrument for concessions, including any concessions contract excluded by Department of Labor regulations at 29 C.F.R. 4.133(b);

 

- 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; and

 

For procurement contracts where workers' wages are governed by the Fair Labor Standards Act, this order shall apply only to contracts or contract-like instruments that exceed the micro-purchase threshold, as defined in 41 U.S.C. 1902(a).

 

Sources:
Executive Order 13658
DOL Wage and Hour Division

By Wendy Stewart