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Department of Labor finalizes rules for $15 minimum wage for federal contractors

Department of Labor finalizes rules for $15 minimum wage for federal contractors
Service Employee International Union members demonstrate for a $15 per hour minimum wage during a rally outside the U.S. Capitol in Washington, D.C., on May 19. File photo by Tasos Katopodis/UPI | License Photo

Nov. 22 (UPI) -- The Department of Labor on Monday finalized its rules for the implementation of a new $15 minimum wage for employees working on federal contracts under an executive order by President Joe Biden.

The agency announced it has completed the rulemaking process necessary to put Executive Order 14026 into effect as planned on Jan. 30, 2022.

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Biden signed the order in April, under which the minimum hourly rate for federal contractors rises from $10.95 per hour, updating the terms of an executive order signed by former President Barack Obama in 2012.

It applies to new contracts, renewals and extensions of existing contracts and is expected to affect some 327,000 workers, many of whom work as food service employees and nursing assistants, according to the Labor Department.

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"The workers helped by Executive Order 14026 and today's final rule do essential work on our nation's behalf," Secretary of Labor Marty Walsh said in a statement. "They build and repair the federal infrastructure, clean and maintain our national parks, monuments and other federal facilities, care for our veterans, and ensure federal workers and military service members are provided with safe and nutritious food.

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"Implementing this executive order improves the economic security of these workers and their families, many of whom are women and people of color," he added.

In addition to raising the minimum wage, the new rules call for annual updates to keep pace with inflation and phase out the lower minimum wage for tipped workers on federal contracts by 2024.

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The measure also mandates a $15 minimum wage for federal contract workers with disabilities.

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