A federal appeals court has upheld a Biden administration rule mandating a $15 minimum wage for seasonal recreational workers employed by government contractors, sparking concerns about the expansion of executive power.
The 10th U.S. Circuit Court of Appeals ruled 2-1 that the president has the authority to set wages for workers, even if they don’t directly provide services to the government, under the Federal Procurement Act of 1949.
However, dissenting Judge Allison Eid argued that this law violates the Constitution by granting the president too much discretion without clear standards.
The ruling upholds a 2021 executive order by President Joe Biden raising the minimum wage for federal contract workers to $15 an hour. The U.S. Department of Labor subsequently implemented a rule that eliminated a Trump-era exemption for seasonal recreational employers.
Federal Court Upholds $15 Minimum Wage for Seasonal Recreational Workers
The 10th Circuit affirmed a lower court’s decision not to block the rule, which was challenged by Arkansas Valley Adventures and the Colorado River Outfitters Association, representing rafting companies.
The decision has sparked criticism from libertarian groups, with Michael Poon of the Pacific Legal Foundation calling it “dangerous and mistaken.”
Poon argued that the ruling grants the president “unlimited unilateral power” to impose conditions on federal permit holders, potentially commanding large portions of the economy.
The plaintiffs argued that the $15 wage would limit services and increase costs. Still, the 10th Circuit found the Labor Department adequately addressed these concerns and that higher wages would improve worker absenteeism, turnover, and service quality. The ruling may have implications for other challenges to the minimum wage hike, including a separate lawsuit in the 5th Circuit.
