About that minimum-wage EO …
posted at 1:32 pm on January 17, 2014 by Ed Morrissey
Can Barack Obama raise the federal minimum wage by executive order? Reports this week have Obama promising Senate Democrats that he was looking into his options, but they would be limited … even more limited than he thinks, probably:
Obama and congressional Democrats are pushing for an across-the-board hike in the minimum hourly wage, from $7.25 to $10.10. But Republicans are cool to the plan, warning it could hurt the economy.
Federal contractors represent only a fraction of the nation’s employees. Businesses that together received more than $446 billion in federal contracts employ some 2 million workers, only some of whom are paid the minimum wage.
Still, an increase for that segment of the workforce could generate momentum toward a raise for all workers now paid the lowest amount allowable by law.
Proponents of the plan say Obama need not wait for Congress to pass legislation. Sanders and Boxer were among 15 senators who sent a letter to Obama in September, urging him to set a minimum-wage preference for private companies doing business with the federal government.
An executive order to that effect would be tantamount to setting a minimum wage for federal contractors, they said.
“Profitable corporations that receive lucrative contracts from the federal government should pay all of their workers a decent wage,” the lawmakers wrote.
At first blush, I thought it was possible this would be permissible (if not advisable) under our Constitutional scheme, given that he was directing the Executive itself to make these payments.
But despite that trying-to-be-fair impulse, I’d still like to see legal opinions on this. After all, the President will not be paying these wagesout of his own funds. The excess wages will, of course, be paid for by taxpayers, and absent an act of Congress raising the federal contractor minimum wage, this seems probably illegal.
As usual, of course.
Color me skeptical, too. One cannot write statutory law through EOs, which is what would have to happen to force companies with federal contracts to pay a certain wage or higher to all their workers. That takes Congress to act, and they’re not budging, which is why Obama is gabbing about “looking into” EOs. Even if he issued it, no company would be under any legal requirement to comply.
Obama could require the executive branch to write contracts with that requirement, though, without Congressional involvement. That can be done with an EO, although it probably wouldn’t require one. However, that requirement would force contractors to offer higher bids, forcing the executive branch to go back to Congress for more money, and would likely result in fewer jobs as contractors reduced costs. The same would be true for any attempt to force a higher floor for direct executive-branch jobs, too. Either way, Obama would have to go back to Congress for more funds.
I’d file this in the “cheap talk” category. Figuratively speaking, of course.
Update: Just to clarify my first point in light of some of the comments, EOs only apply to executive branch agencies and their direct employees, not to contractors or those working for contractors. The latter are bound by statute and the terms of the contract, and nothing more. Obama can pretend that he has the authority to order this in an EO, but contractors will simply ignore it — it can’t be enforced, and won’t be.
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