On February 9, 2026, the U.S. Department of Labor (DOL), Wage and Hour Division, announced an increase to the Obama-era Executive Order (EO) 13658 federal contractor minimum wage from $13.30 per hour to $13.65 per hour.¹ This rate increase comes after President Trump rescinded a Biden-era $15.00 per hour executive order² that set a much higher federal contractor minimum wage, which eventually reached $17.75 per hour just prior to rescission. We have covered some of the changes last year related to the federal contractor minimum wage in this alert.

The announcement of this increase to the EO 13658 federal contractor minimum wage is not surprising—the regulations call for an annual adjustment to this minimum wage rate. What was unexpected in the announcement was the DOL’s pronouncement that federal contractor minimum wage requirements under EO 13658 do not apply to contracts renewed or awarded after January 29, 2022, even though President Trump has not revoked EO 13658 or addressed its continuous applicability.

According to the notice issued by the DOL, the new minimum wage will take effect on May 11, 2026, for workers performing work in connection with certain federal contracts covered by EO 13658. The DOL also set a new wage of $9.55 per hour for tipped workers. Although, as noted above, DOL explicitly states that the new minimum wage will only apply to certain federal contracts (specifically those entered into between January 1, 2015, and January 29, 2022, that were not renewed or extended (pursuant to an exercised option or otherwise) on or after January 30, 2022), DOL did not document its reasoning, nor has it cited to any particular legal authority supporting its interpretation. Nor has DOL issued new rules or revised any existing rules to reflect this narrow interpretation of the scope of coverage for EO 13658. While this leaves some uncertainty as to the legal heft of this new DOL interpretation, it certainly suggests that DOL does not intend to enforce this new federal contractor minimum wage beyond the narrow scope of contracts identified.

For contractors paying employees under EO 13658, this DOL update and narrow interpretation of the application of EO 13658 carries significant implications. First, if contractors apply this new minimum wage increase to contracts outside the scope of covered contracts identified by DOL and then seek reimbursement from the Government for this increase (as is contemplated under current FAR provisions) through an equitable adjustment, contractors should expect agency contracting officers to resist any such request. More broadly, where there are questions about the applicability of EO 13658 to a specific contract, we encourage contractors to raise this issue with their contracting officers to ensure all parties are aligned in their interpretation of this DOL guidance. Second, contractors must remain mindful of the evolving minimum‑wage landscape (including potentially higher state and local minimum wage rates) when assessing how to adjust their pay practices going forward. Finally, contractors also need to take into account this narrow DOL interpretation of EO 13658 when preparing pricing for new proposals.

As reflected in this most recent DOL interpretation, the rules associated with the federal contractor minimum wage continue to evolve and change. For more information on these and other GovCon L&E changes, feel free to contact our Cozen O’Connor GovCon team, which is monitoring these changes closely and available to assist with these matters.