$11.25 Minimum Wage Effective January 1, 2022 For Federal Contractors Subject To Obama-Era Executive Order

Jackson Lewis P.C.

In the flurry of activity surrounding President Biden’s Executive Order 14042 – Ensuring Adequate COVID Safety Protocols for Federal Contractors, federal contractors are also awaiting approval of regulations to implement President Biden’s Executive Order raising the minimum wage for some federal contractor employees to $15 per hour.

In the meantime, the provisions of former President Obama’s minimum wage order have resulted in an increase in the minimum wage from $10.95 to $11.25 for covered employees. That rate will go into effect on January 1, 2022.

As a reminder, the federal contractor minimum wage applies only to workers and employees working “on or in connection with” a covered federal contract or subcontract. An employee works “on” a covered contract when she performs the work called for by the contract. Employees are considered to be working “in connection with” a covered contract if they are “performing work activities that are necessary to the performance of a covered contract but … are not directly engaged in performing the specific services called for by the contract itself.”

In addition, the minimum wage does not apply to employees working only “in connection with” a covered contract, where the employee works less than 20% of her time in any given workweek “in connection with” a covered contract.



DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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