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Federal Register / Vol. 86, No. 138 / Thursday, July 22, 2021 / Proposed Rules
23.570c requires the ARBs order to mandate action to remedy the violation, including, but not limited to, providing monetary relief for unpaid wages, if the ARB concludes a violation occurred. If the Administrator has sought debarment, the ARB must determine whether a debarment remedy is appropriate. Proposed 23.570c also provides that the ARBs order is subject to discretionary review by the Secretary as provided in Secretarys Order 01
2020 or any successor to that order. See Secretary of Labors Order, 012020
Feb. 21, 2020, 85 FR 13186 Mar. 6, 2020.
Finally, proposed 23.570d provides that the ARBs decision will become the Secretarys final order in the matter in accordance with Secretarys Order 012020 or any successor to that order, which provides for discretionary review of such orders by the Secretary.
See id.

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Section 23.580 Administrator Ruling Proposed 23.580 sets forth a procedure for addressing questions regarding the application and interpretation of the rules contained in part 23. Proposed 23.580a, which the Department derived primarily from 29
CFR 5.13, provides that such questions should be referred to the Administrator.
It further provides that the Administrator will issue an appropriate ruling or interpretation related to the question. Requests for rulings under this section should be addressed to the Administrator, Wage and Hour Division, U.S. Department of Labor, Washington, DC 20210. Any interested party may, pursuant to 23.580b, appeal a final ruling of the Administrator issued pursuant to 23.580a to the ARB.
Appendix A to Part 23 Contract Clause Section 2 of Executive Order 14026
provides that executive departments and agencies, including independent establishments subject to the Federal Property and Administrative Services Act, must, to the extent permitted by law, ensure that new contracts, contractlike instruments, and solicitations include a clause, which the contractor and any covered subcontractors must incorporate into lower-tier subcontracts, specifying, as a condition of payment, the minimum wage to be paid to workers under the order. 86 FR 22835.
Section 4 of the Executive order provides that the Secretary shall issue regulations by November 24, 2021, consistent with applicable law, to implement the requirements of the order. 86 FR 22836. Section 4 of the order also requires that, to the extent permitted by law, within 60 days of the
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Secretary issuing such regulations, the FARC shall amend regulations in the FAR to provide for inclusion of the contract clause in Federal procurement solicitations and contracts subject to the Executive order. Id. The order further specifies that any regulations issued pursuant to section 4 of the order should, to the extent practicable, incorporate existing definitions, principles, procedures, remedies, and enforcement processes under the FLSA, SCA, and DBA, Executive Order 13658, and regulations issued to implement Executive Order 13658. Id. Section 5 of the order grants authority to the Secretary to investigate potential violations of and obtain compliance with the order. Id. Because a contract clause is a requirement of the order, the Department sets forth the text of a proposed contract clause as appendix A.
As required by the order, the proposed contract clause specifies the minimum wage to be paid to workers under the order. The Secretary possesses the authority to obtain compliance with the order, as well as the responsibility to issue regulations implementing the requirements of the order that incorporate, to the extent practicable, existing definitions, principles, procedures, remedies, and enforcement processes under the FLSA, SCA, DBA, Executive Order 13658, and the regulations issued to implement Executive Order 13658. Consistent with that authority and responsibility, the provisions of the proposed contract clause are based on the contract clause included in the Executive Order 13658
rulemaking, which was in turn based on the statutory text or implementing regulations of the FLSA, SCA, and DBA.
See 79 FR 60685.
The first sentence of proposed 23.110 requires that the contracting agency include the Executive order minimum wage contract clause set forth in appendix A in all covered contracts and solicitations for such contracts, as described in 23.30, except for procurement contracts subject to the FAR. It further states that the required contract clause directs, as a condition of payment, that all workers performing on or in connection with covered contracts must be paid the applicable, currently effective minimum wage under Executive Order 14026 and 23.50. It additionally provides that for procurement contracts subject to the FAR, contracting agencies shall use the clause set forth in the FAR developed to implement this rule and that such clause must both accomplish the same purposes as the clause set forth in
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appendix A and be consistent with the requirements set forth in this rule.
Paragraph a of the proposed contract clause set forth in appendix A provides that the contract in which the clause is included is subject to Executive Order 14026, the regulations issued by the Secretary of Labor at 29 CFR part 23 to implement the orders requirements, and all the provisions of the contract clause.
Paragraph b specifies the contractors minimum wage obligations to workers pursuant to the Executive order. Paragraph b1 stipulates that each worker, as defined in 29 CFR
23.20, employed in the performance of the contract by the prime contractor or any subcontractor, regardless of any contractual relationship that may be alleged to exist between the contractor and the worker, shall be paid not less than the Executive orders applicable minimum wage. The term worker includes any person engaged in performing work on or in connection with a contract covered by the Executive order whose wages under such contract are governed by the FLSA, the SCA, or the DBA, regardless of the contractual relationship alleged to exist between the individual and the contractor.
Paragraph b2 provides that the minimum wage required to be paid to each worker performing work on or in connection with the contract between January 30, 2022, and December 31, 2022, is $15.00 per hour. It specifies that the applicable minimum wage required to be paid to each worker performing work on or in connection with the contract should thereafter be adjusted each time the Secretarys annual determination of the applicable minimum wage under section 2aii of the Executive order results in a higher minimum wage. Section b2 further provides that adjustments to the Executive order minimum wage will be effective January 1st of the following year, and will be published in the Federal Register no later than 90 days before such wage is to take effect. It also provides that the applicable minimum wage will be published on https
alpha.sam.gov/content/wagedeterminations or any successor website and was incorporated by reference into the contract.
The effect of paragraphs b1 and 2
will be to require the contractor to adjust the minimum wage of workers performing work on or in connection with a contract subject to the Executive order each time the Secretarys annual determination of the minimum wage results in a higher minimum wage than the previous year. For example, paragraph b1 will require a
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