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The Department of Labor has announced a federal-contractor minimum wage of $14.05 an hour for non-tipped workers, with a $9.85 an hour cash wage for tipped workers. The rates are reported to take effect 90 days after publication of the notice in the Federal Register. They are future rates for certain older contracts—not the rates currently in force and not a new minimum for every federal contractor. Construction Dive reported the announcement on October 8, 2026.
What is the federal contractor minimum wage for 2027?
The announced rate is $14.05 per hour for covered non-tipped workers. For covered tipped workers, the announced cash wage is $9.85 per hour; tips must be counted under the applicable rules to determine whether the worker receives the full minimum. Construction Dive reported both figures as rates announced by the Department of Labor. The Federal Register notice should be consulted for the final terms.
These are not the rates in force throughout 2026. DOL lists the current rates, effective May 11 through December 31, 2026, as $13.65 per hour for non-tipped workers and $9.55 in cash wages per hour for tipped workers. See DOL’s Executive Order 13658 annual update.
| Worker category | Current rate, May 11–December 31, 2026 | Announced next rate |
|---|---|---|
| Non-tipped | $13.65 per hour (DOL) | $14.05 per hour (reported by Construction Dive, October 8, 2026) |
| Tipped | $9.55 per hour in cash wages; tips must bring total pay to at least $13.65 (DOL) | $9.85 per hour in cash wages (reported by Construction Dive, October 8, 2026); verify final tip-credit terms in the notice |
When does the $14.05 rate take effect?
Construction Dive reports that the new rates take effect 90 days after the notice is published in the Federal Register. That is a relative timeframe, not a calendar date. Check the notice’s publication and effective dates before relying on a particular start day for payroll or a wage claim; the reported announcement alone does not establish a calendar effective date.
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Which federal contracts are covered?
The adjustment applies to a limited group of contracts that remain subject to Executive Order 13658 (EO 13658), not to all federal contracts or everyone employed by a federal contractor. DOL describes the order as principally covering certain contracts subject to the Davis-Bacon Act or Service Contract Act that were entered into from January 1, 2015 through January 29, 2022 and were not renewed or extended on or after January 30, 2022. The 2027 adjustment was reported for this legacy-contract category.
EO 13658 also reaches specified concessions and certain services performed in connection with federal property or lands, and excludes seasonal recreational services under other executive orders. Coverage depends on the contract and the work—not just on whether an employer does business with the federal government. Workers and employers should review the contract’s wage determination and DOL’s EO 13658 guidance.
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What happened to the former $15 federal contractor minimum wage?
The $15 rate was tied to Executive Order 14026 (EO 14026), a separate order from EO 13658. DOL says President Trump revoked EO 14026 on March 14, 2025, and the department is no longer enforcing it or its implementing rule, 29 CFR part 23. DOL says EO 13658 remains in effect for its residual category of covered contracts. Its EO 13658 frequently asked questions explain the agency’s position.
The new $14.05 figure is therefore not a direct reduction from $15 for every federal contract. It is the reported next adjustment under EO 13658 for the older contracts that remain covered after EO 14026’s revocation. Construction Dive quoted the notice as saying, “As a result, at this time Executive Order 13658 remains in effect.”
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What should workers and employers check?
- Confirm contract coverage: Identify the applicable contract, its wage determination, and its renewal or extension history; employer identity alone does not establish entitlement to this rate.
- Use the rate in force for the relevant pay period: DOL’s listed 2026 rates remain $13.65 and $9.55 through December 31, 2026. Apply the announced figures only once the effective date and terms are confirmed in the notice.
- For tipped work, distinguish cash wages from the full minimum: The announced $9.85 is a cash wage, not the full minimum workers must receive after tips are counted. Check the final notice for the precise 2027 requirements.
- Use DOL’s official poster and guidance: DOL provides a Worker Rights Under Executive Order 13658 poster and related materials.
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