What happened?

On March 14, 2025, President Trump rescinded an executive order that mandated a higher minimum wage for workers on federal contracts.

Overview:

Although Biden’s minimum wage order is no longer in effect, federal contractors still have wage obligations under federal, state, and local laws.

Executive Order and Impacts:

• Compliance: It is prudent to comply with the minimum wage requirements of the Obama-era order (E.O. 13658) on all contracts. This sets the minimum wage at $13.30 per hour ($9.30 for tipped employees).

• State and Local Laws: Beyond federal law, contractors may have minimum wage requirements at the state or local level.

• Collective Bargaining Agreements: Contractors may also have obligations under collective bargaining agreements.

• Prevailing Wage Laws: Many federal contracts will still be covered by prevailing wage laws such as the Davis-Bacon Act or the McNamara-O’Hara Service Contract Act.

• Contract Requirements: For contracts entered before Biden’s order took effect on January 30, 2022, contractors must pay workers $13.30 an hour under the Obama-era executive order. Other contractors must only pay the federal minimum wage of $7.25 an hour or the applicable state minimum wage.

• Regulatory Updates: The U.S. Department of Labor (DOL) will issue interim guidance or updates to regulations, clarifying the requirements for contracts entered into or renewed, extended, or modified after the revocation of Biden’s order.

Source References

• EO – Additional Rescissions of Harmful Executive Orders and Actions
• DOL Final Rule: Increasing the Minimum Wage for Federal Contractors (Executive Order 14026)

This communication is intended solely for the purpose of conveying information. The present post might incorporate hyperlinks directing readers to websites managed by third-party entities. The inclusion of any links within this communication is meant to serve as points of reference and could encompass opinion articles from various law firms, articles from HR associations, official websites, news releases, and documents of government agencies, and other relevant third-party sources. Vensure has no authority over these external websites and bears no responsibility for their content. Furthermore, Vensure does not endorse the materials present on these websites. The contents of this communication should not be interpreted as legal advice or as a legal standpoint concerning specific facts or scenarios. Nor should it be deemed an exhaustive compilation of facts potentially pertinent to federal, state, or local laws. It is strongly advised that employers solicit legal guidance from an employment attorney when undertaking actions in response to any legal updates provided. This is due to the possibility of future alterations occurring in federal, state, and local laws, regulations, as well as the directives and guidelines issued by governing agencies. These changes may transpire at any given time, potentially rendering certain portions of the content within this update void or inaccurate.