U.S. President Joe Biden will sign an executive order according to which contractors will have to pay at least $15 per hour to federal government contract workers.
Currently, workers who are hired through contracting agencies of the federal government, are paid $10.95 per hour. These contract workers include cleaners, maintenance staff, cafeteria staff and even nursing assistants who take care of the elderly, among others.
This hike will come into effect only from March 30, 2022. It will first be implemented for all the new contracts and then apply to all the renewals as and when they happen, gradually.
After that, based on inflation, these hourly wages will be hiked every year.
From now on, all federal contract workers will have equal minimum wages. Earlier, the low wagers were paid $7.65 per hour and it was only through tips that their wages were brought to the minimum-wage level.
The hike is expected to increase productivity and decrease turnover and related expenses, without any increase in cost to the taxpayers.
The move will benefit the thousands who work full time and yet struggle in poverty.
It is hoped that this measure will encourage organisations across the country to hike hourly wages for their contract staff too. During his election campaign, President Biden had promised to ensure that the minimum wages of workers across the US will be raised to $15 by 2025.