Notice of Minimum Wage Rate Change for Federal Contracts in January 2023
The U.S. Department of Labor, Wage and Hour Division (WHD) announced a minimum wage increase for workers performing work on or in connection with federal contracts covered by Executive Order (E.O.) 14026, Increasing the Minimum Wage for Federal Contractors. This rate change is effective January 1, 2023, increasing the minimum wage for covered employees to $16.20 per hour.
President Biden issued E.O. 14026, which raised the hourly minimum wage to $15.00 per hour, beginning on January 30, 2022, with annual adjustments planned for inflation after that in amounts determined by the Secretary of Labor.
Currently, workers working on covered federal contracts are paid a minimum wage of $15.00 per hour. By January 30, 2023, all agencies must implement the $16.20 minimum wage into all new contract solicitations. Additionally, agencies must implement the new higher rate into existing contracts when parties exercise their option to extend.