Sponsors (8)
The bill raises and protects wages for federal contract workers and strengthens enforcement and clarity for procurements, at the cost of higher contractor labor expenses, greater taxpayer outlays, and increased compliance and transition burdens that could reduce contractor competitiveness or slow some procurements.
Low-wage federal contract employees (including tipped workers and construction workers) will receive higher base pay (statutory Living Wages floor and/or $25/hr benchmark) with future CPI–W indexing, increasing take-home earnings and preserving purchasing power over time.
Workers on new federal contracts (especially low-wage and construction workers) are likely to see improved living standards and reduced reliance on public assistance due to higher, more consistent minimum wages.
Stronger enforcement tools (termination authority, double-pay remedies, withholding and debarment) increase the likelihood that contract workers recover unpaid wages and that bad actors are deterred.
Small and other contracting firms face materially higher labor costs, which can cut profit margins, reduce competitiveness on bids, and prompt contractors to limit hiring, subcontracting, or exit certain federal work—risking job losses for some contract workers.
Federal agencies may pay more for goods and services (or fund fewer projects) as higher contractor wages are passed into contract prices, increasing taxpayer expenditures or shrinking procurement scope.
Agencies and contractors will incur increased compliance and administrative burdens—annual wage determinations, rulemaking, withholding procedures, payroll updates and enforcement actions—raising overhead and transition costs.
Based on analysis of 5 sections of legislative text.
Requires federal contractors to pay a minimum that phases from $17 to $25/hour over five years and then rise with CPI–W; updates Davis‑Bacon and procurement wage floors accordingly.
Official title: To establish a minimum wage for all Federal contractors, and for other purposes.
Introduced July 2, 2026 by Alma Adams · Last progress July 2, 2026
Requires employers holding federal contracts to pay a rising, tiered minimum wage starting at $17.00/hour and increasing to $25.00/hour over five years, with annual CPI–W inflation adjustments thereafter. It also raises the Davis‑Bacon prevailing wage floor and changes procurement wage standards so that the new contractor wage floor becomes a baseline for covered federal contracts. Sets a tipped-employee step-up schedule, requires contracting clauses that allow termination and government completion for underpayment, creates employee remedies (including doubled back pay), and tasks the Secretary of Labor with setting and annually adjusting the wage rate using the CPI–W index.