President Trump Decreases Minimum Wage for Federal Contractors

On March 14, 2025, President Trump issued an executive order that rescinded 18 executive orders issued by President Biden, including Executive Order 14026, which had increased the federal contractor minimum wage to $17.75 per hour. This order effectively ends the obligation to pay individuals working on or in connection with certain federal contracts or subcontracts the higher minimum wage.

The federal contractor minimum wage was first established by President Obama through Executive Order 13658 on February 12, 2014. This order applied to government contracts and subcontracts involving construction, services, or concessions connected with federal property or lands and related to offering services for federal employees, their dependents, or the general public. The minimum wage under the Obama E.O. was originally set at $10.10 per hour and was subject to annual increases tied to the Consumer Price Index. As of January 1, 2025, the minimum wage under the Obama E.O. was $13.30 per hour.

President Biden’s Executive Order 14026, issued on April 27, 2021, applied to the same types of contracts and workers as the Obama E.O. but further increased the minimum wage and began phasing out the lower minimum wage for tipped employees. The Biden E.O. also called for annual increases based on changes in the Consumer Price Index, setting the wage at $17.75 per hour as of January 1, 2025.

With the rescission of the Biden E.O., there is now uncertainty regarding the minimum wage requirements for government contractors. Contractors subject to the Obama E.O. must continue to comply with its minimum wage requirements, but there is less clarity for those previously subject to the Biden E.O. The Department of Labor is expected to provide guidance on these questions, and contractors are advised to consult their legal counsel for further instructions.

Read the original blog at this link: President Trump Decreases Minimum Wage for Federal Contractors