Federal contractors are prepping for an increase in the contractor minimum wage to $15 per hour. That’s almost a 50% increase from the last time the White House set the rate.
- Eric Crusius, partner at Holland & Knight, said the increase could help reduce turnover, which increased during the pandemic, if contractors are able to pass the cost onto the government.
- Crusius said there could be complications if agencies do not put the necessary clause into their contracts initially because contractors would have to pay backwages in the future.
- Crusius advised contractors to communicate the new rule to employees and assure them they will receive the raise as soon as it is in the contract they are working on or in connection with.