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Biden raising minimum wage for federal contractors to $15/hr

3 minute read

U.S. Capitol maintenance staff disinfect surfaces before the House Energy and Commerce Committee hearing on coronavirus in Washington, DC, U.S. June 23, 2020. Sarah Silbiger/Pool via REUTERS

WASHINGTON, April 27 (Reuters) - President Joe Biden will press his case for a national $15 minimum wage with an executive order on Tuesday raising pay to at least that level for hundreds of thousands of federal contract workers, senior White House officials said.

This would increase their existing minimum wage of $10.95 by nearly 37% by March 2022 with future increases still tied to inflation.

The workers range from cleaning and maintenance staff to food service contractors and laborers and include tipped workers such as seasonal recreational services and shuttle bus drivers who were left out of the last increase under former President Barack Obama.

The order also ensures $15 an hour for federal contractors with disabilities.

Sylvia Walker, a federal contract worker at Maximus, which operates call centers for the Centers for Medicare and Medicaid Services, called the executive order an "important first step."

“We’ve fought hard for fair pay and better working conditions, and we are thankful Biden's administration has heard our call to action," Walker said.

Biden made supporting blue-collar workers a priority of his presidential campaign, saying strong unions and higher wages can resurrect America's middle class while helping bridge economic and racial inequities. The executive order is his latest step in support of the organized labor movement.

On Monday, he signed an order creating a White House task force headed by Vice President Kamala Harris to promote unions and labor organizing. Union membership has steadily declined in the United States in recent years.

Since taking office in January, Biden has ousted government officials whom unions have called hostile to labor, reversed Trump-era rules that weakened worker protections and bailed out troubled union pensions. He appeared in a video alluding to workers in an Amazon facility in Alabama who were voting on whether to form a union. The effort failed.

Biden tried to insert a federal $15 minimum wage into the $1.9 trillion COVID-19 relief bill signed in March, but Congress stripped it from the package after the U.S. Senate parliamentarian ruled it did not qualify under the special budget rules that the Senate used to pass the measure.

Congress has not raised the federal minimum wage for all workers – $7.25 an hour – since 2007, despite opinion polls showing Americans overwhelmingly favor an increase.

“Change is possible. We urge Congress to follow President Biden’s courageous leadership and make sure all workers - not just federally contracted workers - are given the same opportunity to thrive by passing the Raise the Wage Act," said Saru Jayaraman, president of One Fair Wage, a national nonprofit that advocates on behalf of tipped workers.

A senior administration official, answering critics who say higher wages will force companies to cut jobs, said: "This would not lead to reduced employment...but would enhance worker productivity and then create higher quality work by boosting workers' health, morale and effort."

Biden’s latest executive order will require all federal agencies to include the increase in new contract solicitations by Jan. 30, 2022. Two months from then they will be required to implement the base wage into new contracts.

Reporting by Nandita Bose and Jarrett Renshaw in Washington; Editing by Lincoln Feast.

Our Standards: The Thomson Reuters Trust Principles.

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