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City of Philadelphia Raises Minimum Wage for Contractors

May 20, 2014

Mayor Michael Nutter of Philadelphia recently signed an executive order that raises the minimum wage for city contractors and subcontractors. Although he was previously opposed to a wage hike for subcontract workers – claiming they were not bound by the living wage provisions applicable to primary contractors -- he later shared:

"No person who works on city contract should live in poverty. We must create ladders of opportunity, we must give America a raise."

The executive order has an immediate and a long-range effect: As of May 20, 2014, a minimum wage of $10.88 extends to first-tier subcontractors, including airport workers, who currently earn an average of $7.85 an hour. By Jan. 1, 2015, the minimum wage will increase to $12 an hour and will be required by firms working on city contracts, receiving city financial assistance or operating under a city lease or franchise. As a result, all city contract workers will share the same minimum wage for the first time in Philadelphia’s history.

This city-specific ruling comes on the heels of President Obama urging cities and states to set a positive example and move forward with their own minimum wage increases, regardless of resistance to a broader federal-level change. It’s also indicative of the current trend of local legislators instituting workplace policy changes, such as increased wages and mandatory paid sick leave.

Stay tuned for continued updates on the minimum wage increase and the resulting poster requirements for affected employers.