The $15 minimum wage for federal contractors goes into effect January 30.

Employees of federal contractors will earn at least $15 an hour under a final rule the Department of Labor announced Monday, which, according to administration estimates, will provide a likely pay increase for more than 300,000 workers.

The wage floor will affect contracts executed or renewed from January 30, 2022. The current minimum wage for contractors is $10.95 under a rule set by the Obama administration in 2014 and is expected to rise to $11, 25 on January 1. Both rules require the minimum wage to increase over time to account for inflation.

Paul Light, an expert on the federal workforce at New York University, estimates that five million people work for federally contracted employers, including security guards, food workers, janitors and call center workers, but most are already earning more than $15 a year. . o’clock. The rule will also apply to construction contracts entered into by the federal government.

Labor Secretary Martin J. Walsh said in a statement that the rule “improves the economic security of these workers and their families, many of whom are women and people of color.”

President Biden announced the rule in April when he signed an executive order directing the department to enact it. Mr Biden’s announcement came amid a series of pro-labor moves by the administration, including rolling back Trump-era rules that softened worker protections and passing legislation that allocated tens of billions of dollars to bolster union pension funds. .

Government officials said they did not expect the increase in the minimum wage to lead to significant job losses or cost increases, arguing that the higher wage would improve productivity and reduce revenue, giving employers and government more value.

The federal minimum wage remains $7.25 an hour, although many cities and states have laws that set their pay floors significantly higher. The House of Representatives has passed a bill to raise the federal minimum to $15 an hour by 2025, but the legislation has not yet progressed in the Senate.

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