---
title: Federal Contractor Minimum Wage Increases May 11, 2026
description: The federal contractor minimum wage increases to $13.65/hour on May 11, 2026 for certain EO 13658 covered contracts. Here’s what employers should review now.
---

[CTR Communicator Blog | CTR Payroll & HR ](https://ctrhcm.com/blog)

# [Federal Contractor Minimum Wage Increases May 11, 2026](https://ctrhcm.com/blog/federal-contractor-minimum-wage-2026)

 Written by [Kara Stivason](https://ctrhcm.com/blog/author/kara-stivason) | May 5, 2026 2:41:19 PM

# **Federal Contractor Minimum Wage Increases May 11, 2026: What Employers Need to Know**

A federal contractor minimum wage update takes effect on May 11, 2026, but this one comes with an important distinction: it applies only to certain covered federal contracts, not all contractors.

For contracts covered under Executive Order 13658, the minimum wage increases to:

👉 Official Department of Labor source:  
[https://www.dol.gov/agencies/whd/government-contracts/minimum-wage](https://www.dol.gov/agencies/whd/government-contracts/minimum-wage?utm_source=chatgpt.com)

👉 Federal Register notice:  
[https://www.federalregister.gov/documents/2026/02/09/2026-02466/minimum-wage-for-federal-contracts-covered-by-executive-order-13658-notice-of-rate-change-in-effect](https://www.federalregister.gov/documents/2026/02/09/2026-02466/minimum-wage-for-federal-contracts-covered-by-executive-order-13658-notice-of-rate-change-in-effect?utm_source=chatgpt.com)

## **What Is Changing**

Beginning **May 11, 2026**:

This increase is required under Executive Order 13658, which mandates annual inflation-based adjustments tied to CPI-W.

👉 CPI-W explanation (Bureau of Labor Statistics):  
[https://www.bls.gov/cpi/](https://www.bls.gov/cpi/)

****

 

### **Who This Applies To (And Where Employers Get Tripped Up)**

The $13.65 rate applies to workers performing work **on or in connection with federal contracts covered by Executive Order 13658**.

These are generally contracts:

👉 Service Contract Act:  
[https://www.dol.gov/agencies/whd/government-contracts/service-contracts](https://www.dol.gov/agencies/whd/government-contracts/service-contracts)

👉 Davis-Bacon Act:  
[https://www.dol.gov/agencies/whd/government-contracts/construction](https://www.dol.gov/agencies/whd/government-contracts/construction)

This means the increase applies to a **specific group of legacy federal contracts**, not every federal contractor.

****

### **Why There’s Confusion**

Employers are dealing with overlapping executive orders:

Executive Order 14026 has since been rescinded, and the Department of Labor is no longer enforcing it.

👉 DOL update:  
[https://www.dol.gov/agencies/whd/government-contracts/eo14026](https://www.dol.gov/agencies/whd/government-contracts/eo14026?utm_source=chatgpt.com)

As a result, many contracts now fall back under EO 13658 rules.

#### **What Employers Should Review Now**

Employers with federal contracts should take a closer look now to avoid compliance issues later.

**1. Identify Covered Contracts**

Confirm whether contracts fall under EO 13658.

**2. Review Contract Dates**

Pay close attention to contract timing and any renewals or extensions.

**3. Update Payroll Rates**

Ensure covered employees are paid at least **$13.65/hour starting May 11, 2026**.

**4. Review Tipped Employee Rules**

If applicable, confirm compliance with the $9.55/hour minimum cash wage and tip credit requirements.

👉 FLSA tipped employee rules:  
[https://www.dol.gov/agencies/whd/flsa/tips](https://www.dol.gov/agencies/whd/flsa/tips)

**5. Update Required Posters**

Ensure required federal contractor notices are current.

👉 Poster access:  
[https://www.dol.gov/agencies/whd/posters](https://www.dol.gov/agencies/whd/posters)

**6. Apply the Highest Wage Requirement**

Employers must comply with whichever rate is highest, including:

### **The Bigger Compliance Risk**

This is not just a rate update. The real risk is misapplying the rule entirely.

Managing wage requirements across federal contracts, state laws and internal policies takes more than just updating a number in payroll. It requires alignment across systems, documentation and ongoing compliance monitoring.

👉 Learn more about how [CTR ](https://ctrhcm.com/)supports employers across payroll and workforce management.

### **How CTR Payroll | HR Helps**

Keeping up with federal contract requirements, wage laws and compliance expectations is complex, especially for organizations operating across multiple states or contract types.

CTR Payroll | HR helps employers:

👉 Explore HR and compliance support:  
[https://ctrhcm.com/hrservices](https://ctrhcm.com/hrservices)

### **FAQs**

**What is the federal contractor minimum wage in 2026?**

Beginning May 11, 2026, the minimum wage for workers on certain covered federal contracts under EO 13658 is **$13.65/hour**.

**Does this apply to all federal contractors?**

No. It applies only to contracts covered by Executive Order 13658.

**What is the tipped employee rate for federal contractors in 2026?**

The minimum cash wage for tipped employees under covered contracts is **$9.55/hour**.

**Why did the federal contractor minimum wage change?**

The rate is adjusted annually based on inflation using CPI-W data.

**--**

Keeping up with wage requirements across federal contracts, state laws and compliance rules is only getting more complex.

If you’re unsure what applies to your workforce or contracts, it’s worth taking a closer look now before it becomes a compliance issue.

👉 Start here:  
[https://ctrhcm.com/hrservices](https://ctrhcm.com/hrservices)

 

*Disclaimer: This blog is for general informational purposes and is not legal advice.*

---

Since 1964, CTR has been a trusted partner. As a Payroll & HR Partner, we offer a complete Human Capital Management (HCM) solution to help businesses manage employees from hire to retire. We provide award-winning software and expert, personalized service to automate and simplify every aspect of the employee life cycle: Payroll, HR, Benefits, Workforce Management, Talent Acquisition, Talent Management, Tax, Compliance, and more. 

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If you can’t say you LOVE your Payroll & HR provider, it’s time to **Contact CTR**!  🌐 [https://ctrhcm.com/contact](https://ctrhcm.com/contact) 📞 Reach us: (800) 468-2794 📧 Email: [sales@ctrhcm.com](mailto:sales@ctrhcm.com)

View our recent HR management & compliance webinars here: [https://ctrhcm.com/resources/](https://ctrhcm.com/resources/) 

[View full post](https://ctrhcm.com/blog/federal-contractor-minimum-wage-2026)

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