Human Resources News & Insights

Is federal contractor minimum wage hike a signal of things to come?

We just reported on the big plans the Department of Labor (DOL) has for the remainder of 2014. Well, it looks like the agency wasted no time putting one of those plans into action.  

DOL Secretary of Labor Thomas E. Perez just announced a proposed rule that would increase the minimum wage for workers on federal service and construction contracts (also know as federal contractors) to $10.10 per hour.

The proposed rule starts the process of implementing Executive Order 13658, which President Obama announced back in February.

According to an economic analysis included in the proposed rule, nearly 200,000 workers will directly benefit from the wage increase.

‘Time for Congress to finish the job’

This rule is significant for all HR pros, regardless of whether they work with federal contractors or not.

Reason: It seems to be the first step in the Obama Administration’s plan to increase the federal minimum wage for all workers.

The president himself has said he supports raising the federal minimum wage.

Following this recent DOL announcement, White House Domestic Policy Director Cecilia Muñoz said:

President Obama is leading by example, raising the minimum wage for federal contract workers, and governors, mayors and businesses around the country are answering the call to join him. Now it’s time for Congress to finish the job and raise the wage for everyone.

In addition to a push for a higher federal minimum wage, many states have proposed legislation toincrease the minimum wage on the state level. And, as we just reported, Seattle just passed a law to ramp up the minimum wage of city workers to $15 per hour.

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