The White House has issued an executive order that will direct government contractors to increase the minimum wage of employees working on federal contracts to $15 per hour.
The new policy will require all federal agencies to include the raise in new contract solicitations by Jan. 30, 2022 and implement the higher wage into new contracts by March 30, 2022, the White House said Tuesday.
The current minimum wage sits at $10.95 and the move will increase that by 37 percent.
The measure will also phase out the subminimum wage for tipped workers by 2024, extend the new minimum pay to federal contract employees with disabilities and bring back minimum wage protections to guides and outfitters working on federal lands.
The order will also index the minimum wage to facilitate adjustments in pay in response to rising cost of living.
The Department of Labor’s wage and hour division and the Federal Acquisition and Regulatory Council will initiate rulemaking efforts to enforce the policy.