The U.S. Department of Labor’s (DOL) Wage and Hour Division (WHD) has released two Notices regarding the 2024 minimum wage rates for federal contractors (DOL, Executive Order 13658, Establishing a Minimum Wage for Contractors: Annual Update; DOL, Final Rule: Increasing the Minimum Wage for Federal Contractors (Executive Order 14026)).
Background.
Executive Orders (EO) 13658 and 14026 contain provisions that require annual inflation-based increases to the minimum wage rate paid to certain federal contract workers. See Payroll Guide ¶18,745.
EO 13658 and EO 14026 apply to:
- Procurement contracts for construction covered by the Davis-Bacon Act (DBA);
- Service contracts covered by the Service Contract Act (SCA);
- Concessions contracts, including any concessions contract excluded from the SCA by the DOL’s regulations at 29 CFR 4.133(b); and
- Contracts in connection with federal property or lands and related to offering services for federal employees, their dependents, or the general public.
EO 14026 applies to contacts entered into, renewed or extended on or after January 30, 2022 while EO 13658 pertains to contracts prior to January 30, 2022.
Executive Order 14026: Contracts entered into, renewed, or extended on or after January 30, 2022
The DOL’s Notice provides that the minimum wage for federal contractors will increase from $16.20 per hour to $17.20 per hour, effective January 1, 2024. Beginning January 1, 2024, the minimum wage rate will apply to both non-tipped and tipped workers.
Executive Order 13658: Contracts prior to January 30, 2022
In a separate Notice, the DOL announced the minimum wage will increase from $12.50 per hour to $12.90 per hour, effective January 1, 2024. The minimum wage for tipped worker under these contracts is increased from $8.50 per hour to $9.05 per hour.
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