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Welcome to Jenner & Block s Government Contracts Legal
Round‑Up, a biweekly update on important government contracts
developments. This update offers brief summaries of key
developments for government contracts legal, compliance,
contracting, and business executives. Please contact any of the
professionals at the bottom of the update for further information
on any of these topics.
Executive Orders
President Biden is raising the minimum wage for workers under
federal government contracts to $15.
Contractors should expect to see a $15 minimum wage in new
contract solicitations and option modifications beginning on
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Legal developments aimed at government contractors do not always make headline news in mainstream media, but last week’s Executive Order on Increasing the Minimum Wage for Federal Contractors, April 27, 2021 (“Executive Order”), did get widespread attention, perhaps because it is viewed by some in political circles as the next best thing for an administration that sees substantial congressional hurdles for more broadly applicable minimum wage increase legislation. So you have probably heard about about the Executive Order, but how will it impact government contractors?
What does the Executive Order do?
Protecting America’s Workers Act
Upcoming Congressional Hearing
Biden Administration Labor Leadership Updates. On Thursday, April 29, the Senate Health, Education, Labor, & Pensions (HELP) Committee held a confirmation hearing for
Ms. Jennifer Abruzzo to serve as General Counsel of the National Labor Relations Board (NLRB) and
Ms. Seema Nanda to serve as Solicitor for the U.S. Department of Labor. In opening remarks, Senate HELP Committee Ranking Member Richard Burr (R-North Carolina) criticized the Biden Administration for what he considers its abrupt and unprecedented firing of NLRB General Counsel Peter Robb, questioning the independence and integrity of the General Counsel’s office after this action. He also expressed concern over Ms. Abruzzo’s involvement in the Agency Review Team for Labor and questioned Ms. Nanda’s “highly partisan” background.
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President Joseph Biden has fulfilled a promise to significantly increase the minimum wage for federal contractor workers working “on or in connection with” a covered federal contract. He has issued an executive order raising the minimum wage for these workers from $10.95 an hour to $15 an hour beginning 2022.
When announcing the “Executive Order on Increasing the Minimum Wage for Federal Contractors,” President Biden said the higher wage “will benefit many women and people of color who likely have children and are the breadwinners in their households …. It will help improve the economic security of their families and narrow racial and gender disparities in income.”
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On April 27, President Biden issued an Exhibit Order (EO) on Increasing the Minimum Wage for Federal Contractors raising the minimum wage for federal contractors, covered subcontractors, and lower-tier subcontractors by 27% from $10.95 to $15.00.
President Biden perhaps signaled his intent to make this increase on his first day in office, directing the Office of Personnel Management (OPM) in one of his first EOs to provide a report with recommendations to promote a $15.00 an hour minimum wage for federal employees. After the changes directed by this EO go into effect, the minimum wage applicable to government contractor employees will be