While Congress remains unable or unwilling to raise the federal minimum wage, some American workers could soon see a boost in their pay. President Biden recently signed an executive order raising the minimum wage for federal contractors to $15 per hour.
The raise applies to employees who are working in connection with federal contracts. Once the rule goes into effect, employers who have a procurement contract with the federal government worth $10,000 or more must pay their employees at least $15 an hour by January of next year.
Wide-reaching change
The new rule will affect employers and employees in many industries, including construction and food and retail companies that have concessions with the federal government.
Another feature of the new rule is that the minimum wage for these workers will be indexed to inflation, so that it will rise as the cost of living increases. In another provision, the executive order will begin to phase out a reduced minimum wage for workers who receive tips. This reduced minimum will rise over the next few years, and catch up with the $15 minimum in 2024.
Low minimum
While the executive order is good news for many workers all over the country, the federal minimum wage still stands at $7.25 per hour — the number it has stayed since 2009. Some states and local governments have increased the minimum within their borders, but Kentucky has not yet followed suit.
To make matters worse, many employers cheat their employees — even their lowest-paid workers — by refusing to pay them all that they are owed. Employers often fail to pay their workers overtime and other types of payment that are required by law.
When this happens, workers may have the option of taking legal action. These cases are sensitive and not always easy to win, but they can be vital ways for workers to get the wages and benefits they deserve. Workers who feel they are being ripped off can speak to a knowledgeable employment law attorney about their options.