Introduction to EO 13658
Executive Order 13658, signed by President Barack Obama in 2014, establishes a minimum wage for federal contractors and subcontractors. The order aims to ensure that workers employed under federal contracts are paid a fair wage, promoting economic growth and reducing income inequality.
The minimum wage requirement applies to new contracts and replacements for expiring contracts, with some exceptions. Contractors must pay their employees a minimum wage of $10.10 per hour, with annual adjustments for inflation, as determined by the Secretary of Labor.
Scope and Applicability of EO 13658
EO 13658 applies to federal contracts and subcontracts that exceed $2,500, including construction, service, and concession contracts. The order also covers contracts for services provided to federal agencies, such as food, lodging, and recreational services.
However, the order does not apply to contracts for the manufacturing or furnishing of materials, supplies, or equipment, unless the contract includes services that are subject to the order.
Minimum Wage Requirements and Enforcement
Contractors must pay their employees the minimum wage required by the order, which is currently $10.95 per hour. The minimum wage will increase annually, based on the Consumer Price Index for Urban Wage Earners and Clerical Workers.
The Department of Labor is responsible for enforcing the minimum wage requirements, and contractors who fail to comply may face penalties, including back pay and debarment from federal contracting.
Exemptions and Exceptions to EO 13658
Certain contracts are exempt from the minimum wage requirements, including contracts for volunteers, and contracts for workers who are exempt from the Fair Labor Standards Act. Additionally, the order does not apply to contracts that are subject to a collective bargaining agreement.
Contractors must also ensure that their subcontractors comply with the minimum wage requirements, and must include a clause in their subcontracts requiring compliance with the order.
Compliance and Best Practices for Contractors
Contractors must take steps to ensure compliance with the minimum wage requirements, including reviewing their contracts and subcontracts, and ensuring that their employees are paid the required minimum wage.
Contractors should also maintain accurate records of their employees' wages and hours, and be prepared to provide documentation to the Department of Labor in the event of an audit or investigation.
Frequently Asked Questions
What is the current minimum wage for federal contractors?
The current minimum wage for federal contractors is $10.95 per hour, with annual adjustments for inflation.
Which contracts are subject to the minimum wage requirements?
Contracts that exceed $2,500, including construction, service, and concession contracts, are subject to the minimum wage requirements.
How is the minimum wage enforced?
The Department of Labor is responsible for enforcing the minimum wage requirements, and contractors who fail to comply may face penalties, including back pay and debarment.
Are there any exemptions to the minimum wage requirements?
Yes, certain contracts are exempt, including contracts for volunteers, and contracts for workers who are exempt from the Fair Labor Standards Act.
What are the consequences of non-compliance with the minimum wage requirements?
Contractors who fail to comply may face penalties, including back pay and debarment from federal contracting.
How often is the minimum wage adjusted for inflation?
The minimum wage is adjusted annually, based on the Consumer Price Index for Urban Wage Earners and Clerical Workers.