On March 14, 2025, President Trump rescinded a Biden-era govt order that had required sure federal building and repair contractors to pay an elevated minimal wage that elevated yearly, most lately set at $17.75 per hour in 2025. President Trump’s Govt Order 14236, Further Rescissions of Dangerous Govt Orders and Actions, rescinded an extended checklist of prior orders, together with President Biden’s Govt Order 14026, Rising the Minimal Wage for Federal Contractors, which had utilized to coated federal contracts signed, renewed, or prolonged on or after January 30, 2022.
Biden’s Order Caught in Authorized Tug-of-Struggle Earlier than Being Mooted by Trump Rescission
The Biden order was already in authorized limbo, although. As we beforehand reported, the U.S. Ninth Circuit Courtroom of Appeals dominated in November 2024 that it exceeded the authority of the President (State of Nebraska v. Su, 9th Cir, Nov. 2024). The Fifth Circuit later disagreed, upholding the Biden order (State of Texas v. President Donald J. Trump, 5th Cir, Feb. 2025), however then on March 28, 2025, it dismissed the case as a result of President Trump’s rescission of the order made it moot (State of Texas v. President Donald J. Trump, 5th Cir, March 2025).
Obama-Period Contractor Wage Order Nonetheless Technically Alive, However Its Attain Has Light
An older govt order issued by President Obama (Govt Order 13658, Establishing a Minimal Wage for Contractors, technically stays in impact however the passage of time has tremendously whittled down the variety of coated federal contractors. It established a special minimal wage scale for federal contracts signed, renewed, or prolonged on or after January 1, 2015, via January 29, 2022. The federal contractor minimal wage beneath each the Obama and Biden orders utilized solely to (1) procurement contracts for building coated by the Davis-Bacon Act; (2) contracts for providers coated by the Service Contract Act; (3) contracts for concessions (similar to at a nationwide park); and (4) contracts to offer providers to federal staff, their dependents, or most people on federal property or lands.
Suggestions: No matter what occurs with the Ninth Circuit case, it received’t have any sensible influence on employers. President Trump’s rescission of the Biden order implies that coated federal contractors are not topic to it. Earlier than lowering any affected staff’ wage charges, although, it is best to take into account the worker relations influence and seek the advice of along with your common enterprise counsel to find out whether or not you might be contractually permitted to take action.
