The U.S. Department of Labor (DOL) Wage and Hour Division issued a final rule in October to implement Executive Order 13658, which would establish an hourly minimum wage of $10.10 for workers on covered federal construction and service contracts.

The final rule applies to new contracts and replacements for expiring contracts with the federal government that result from solicitations issued on or after Jan. 1, 2015, or to contracts that are awarded outside the solicitation process on or after Jan. 1, 2015.

Beginning Jan. 1, 2016, the minimum wage will be determined annually by the Secretary of Labor, but will not be less than the amount in effect on the date of such determination.

Associated Builders and Contractors opposes the rule because most government contractors already pay the majority of their employees higher wage rates, as required by the Davis-Bacon Act and the Service Contract Act, and the rule could create confusion and increased regulatory burden when reporting wages.