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Outbyte PC Repair FREEClear out junk files and repair common Windows errorsFree Scan →Outbyte Driver Updater FREEFix the driver behind crashes, sound loss and screen glitchesFind Drivers →Yes, a federal contractor minimum wage can affect the amount used to calculate overtime, but it does not replace the overtime rules. First determine whether the worker and contract are covered by a current contractor wage order. Then identify the applicable minimum-wage floor and separately calculate overtime for hours over 40 in a workweek, if the worker is covered by overtime law. As of 2026, the Department of Labor says the former Executive Order 14026 regime is no longer enforced; a narrower group of older contracts may still fall under Executive Order 13658.
What changed for federal contractor minimum wages?
The most important date is March 14, 2025. On that date, Executive Order 14236 revoked Executive Order 14026, which had established a higher minimum wage for certain federal contractors. The U.S. Department of Labor (DOL) says it no longer enforces EO 14026 or its implementing regulation, 29 CFR part 23. Older articles and payroll materials may still refer to EO 14026 rates, including its former $15 base rate, but that history should not be mistaken for a currently enforceable contractor minimum under that order.
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EO 13658 is a separate, older order. DOL says it may still apply to a limited category of contracts: generally, certain contracts covered by the Davis-Bacon Act or Service Contract Act that were entered into, renewed, or extended between January 1, 2015, and January 29, 2022, and were not renewed or extended on or after January 30, 2022. The dates and contract terms matter; having a federal customer or working at a federal site does not, by itself, establish that a worker receives an EO 13658 wage.
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1Fix the driver behind crashes, sound loss and screen glitches2Repair Windows errors before they cause bigger problems3Scan for outdated or missing drivers - takes under a minuteFor contracts that meet EO 13658’s coverage criteria, DOL announced rates effective May 11, 2026, of $13.65 per hour for non-tipped employees and $9.55 per hour for tipped employees. These are order-specific wage floors, not a universal minimum for everyone working on a federal contract. The applicable rate for a particular worker can also be affected by coverage, duties, exemptions, the contract’s wage requirements, and more protective law.
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Does the contractor minimum wage change the overtime rate?
It can affect the pay calculation, but the minimum wage and overtime are separate obligations. The contractor minimum is a floor for covered work hours. Overtime law, when it covers a worker, generally requires at least one-and-one-half times the applicable regular rate for hours worked over 40 in a workweek. The overtime amount is not automatically calculated by taking the contractor minimum wage in isolation: the applicable regular rate may differ from that floor.
A 2021 DOL rule implementing the now-revoked EO 14026 stated that the Fair Labor Standards Act (FLSA) and the Contract Work Hours and Safety Standards Act require covered workers to receive at least one-and-one-half times the regular rate or basic rate for hours over 40 in a workweek. That sentence describes the rule text, not DOL’s current enforcement of EO 14026. The broader distinction remains useful: first establish which overtime law covers the worker, then determine the applicable rate and hours under that law. This article is not an individual wage determination.
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A simplified example of the arithmetic
Suppose, purely for illustration, that a covered, non-exempt worker’s applicable regular rate for a workweek is $18 per hour and the worker has 45 hours of work. At a one-and-one-half-times benchmark, the overtime rate would be $27 per hour for the five hours over 40. This example demonstrates the multiplier only; it does not determine how any particular employee’s regular rate must be calculated or which hours qualify.
If a worker’s regular rate were exactly the EO 13658 non-tipped floor of $13.65, a simplified one-and-one-half calculation would produce $20.475 per overtime hour. That arithmetic is not a promise that $13.65 is the correct regular rate, that the worker is covered by EO 13658, or that no other pay components or legal requirements change the calculation. For tipped workers, do not use the $9.55 figure alone to infer an overtime rate: the applicable treatment of cash wages, tips, and any tip credit needs to be checked under the law governing that worker.
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Which contractor minimum-wage regime may apply?
| Question | EO 13658 | EO 14026 |
|---|---|---|
| Current status described by DOL | May remain relevant to a limited group of qualifying older contracts. | Revoked March 14, 2025; DOL says it no longer enforces the order or its implementing rule. |
| Contract boundary | Generally certain Davis-Bacon Act or Service Contract Act contracts entered into, renewed, or extended from January 1, 2015, through January 29, 2022, and not renewed or extended on or after January 30, 2022. | Not a currently enforced wage regime, according to DOL. |
| Rate information in DOL’s 2026 notice | $13.65 per hour for non-tipped employees and $9.55 for tipped employees, effective May 11, 2026, where coverage criteria are met. | Former rates should not be represented as currently enforceable under EO 14026. |
| What the rate means for overtime | A minimum-wage floor does not replace a separate overtime analysis. | Historical rule text discussed overtime, but DOL no longer enforces that order and rule. |
The table distinguishes the orders, not every possible source of a worker’s wage rights. An applicable prevailing-wage determination or state or local law may impose a higher wage. DOL states that the EO 13658 minimum is a monetary hourly wage: fringe benefits do not count toward satisfying that cash-wage floor.
How to check whether a worker is covered
Do not infer coverage from the employer’s federal-contractor status alone. The contract, the worker’s role, and the relevant legal provisions all matter. For an initial check, gather the following information before relying on a rate or estimating overtime:
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- The contract and its history: Identify the specific contract, whether it is covered by the Davis-Bacon Act or Service Contract Act, and when it was entered into, renewed, or extended. For possible EO 13658 coverage, confirm whether a renewal or extension occurred on or after January 30, 2022.
- The worker’s work and classification: Record the duties performed and how the worker is classified. Do not assume every employee associated with a covered contract is covered by the same wage provision, or that every worker is entitled to overtime without checking exemption status.
- The hours in each workweek: Keep the actual hours worked in each workweek separate. The overtime benchmark described here concerns hours over 40 in a workweek; a pay period spanning multiple workweeks is not a substitute for the workweek analysis.
- All pay components: Gather hourly wages, salary or other compensation, and any pay elements that could affect the regular-rate calculation. Do not calculate an individual’s rate from the contractor minimum alone.
- The governing wage requirements: Check the contract’s wage terms and applicable federal, state, or local requirements, including whether a higher wage applies. A contractor order’s minimum is not a ceiling that displaces a higher applicable minimum.
DOL’s Fact Sheet #83A explains EO 13658’s coverage boundaries, exemptions, higher-wage principle, and cash-wage requirement. For a specific worker, the contract’s actual terms and the applicable law should be reviewed together; a general summary cannot confirm coverage or resolve a classification question.
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- Identify the workweek and total hours. Use the worker’s actual hours for each workweek and determine whether any hours exceed 40. Do not combine separate workweeks to reach an average.
- Check overtime coverage and exemptions. Determine whether the worker is covered by the applicable overtime law and whether an exemption applies. A federal contract or contractor minimum wage does not answer this question by itself.
- Establish the applicable wage floor. If EO 13658 coverage is confirmed, compare its current rate with any higher wage requirement that applies. The EO 13658 floor cannot be satisfied by counting fringe benefits instead of the required monetary hourly wage.
- Determine the applicable regular rate or basic rate. Use the rules that govern the worker and pay arrangement. The former EO 14026 regulation described a general regular-rate method as total workweek earnings divided by the total hours for which that compensation was paid. That is historical rule text and should not be applied as a universal current formula without checking the applicable law and pay components.
- Apply the overtime multiplier to the correct rate. For a worker covered by the relevant overtime provision, the general benchmark is at least 1.5 times the applicable regular rate or basic rate for hours over 40 in the workweek. The correct rate may be higher than a contractor minimum, and the calculation may depend on facts not available from the minimum-wage figure alone.
This sequence prevents two common errors: assuming every federal-contract worker has the same wage floor, and treating the contractor minimum as the complete overtime calculation. If contract coverage, classification, pay components, or jurisdiction is uncertain, a payroll estimate based on one hourly figure may be misleading.
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Special caution for tipped employees
The 2026 EO 13658 notice gives a $9.55-per-hour minimum for covered tipped employees. That figure should be kept attached to its specific context: it is the tipped rate announced for EO 13658 coverage, effective May 11, 2026. It is not enough, by itself, to determine a tipped worker’s overtime rate or total lawful compensation.
The former EO 14026 rule said that, for tipped employees under that rule, the regular rate included employer-paid cash wages and any tip credit taken, while tips received above the tip credit were excluded. Because DOL no longer enforces EO 14026 or its rule, those details should not be generalized to every current tipped-pay arrangement. Determine which current wage and overtime provisions apply before using a tip-credit method or calculating overtime.
Common mistakes and how to avoid them
- Using a former EO 14026 rate as current law: DOL says the order was revoked in March 2025 and is no longer enforced. Check whether the contract instead meets EO 13658’s narrower criteria.
- Assuming all federal contractors are covered by EO 13658: Verify the contract type and relevant dates, including later renewals or extensions.
- Multiplying the minimum wage without checking the regular rate: The minimum establishes a floor where applicable; it does not establish all pay components or the correct regular rate for every worker.
- Assuming a worker is exempt or non-exempt based only on job title: Duties and classification matter. The federal-contract connection alone does not settle overtime eligibility.
- Counting benefits toward the EO 13658 hourly floor: DOL describes that floor as a monetary wage. Fringe benefits do not substitute for the required hourly cash wage.
- Ignoring a higher applicable wage: A higher federal, state, local, or prevailing-wage requirement may control the minimum owed. A contractor order does not cap the worker’s wage rights.
What to do if a paycheck seems wrong
Start by organizing the records that determine both the wage floor and overtime: the contract identifier and dates, the worker’s duties and classification, workweek-by-workweek time records, pay statements, and the breakdown of wages and other compensation. Compare the hours and rate used on the paycheck with the contract’s wage requirements and the applicable overtime calculation; do not rely on a single headline minimum-wage number.
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If the employer or payroll administrator cannot explain which contract provision and wage rule it used, ask for that explanation in writing. A worker may also seek guidance from DOL’s Wage and Hour Division or consult an employment-law professional, especially when there is a dispute about contract coverage, an exemption, tip credits, or state and local protections. The facts available here cannot determine whether a particular paycheck is lawful.
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