Democrat President Joe Biden’s order to force a $15 per hour minimum wage for federal contract workers has been partly blocked by the U.S. Court of Appeals for the 10th Circuit.
The court partially stayed the enforcement of Biden’s executive order that requires that all federal contractors be paid a $15 wage.
The ruling came on February 17 in a lawsuit brought by Colorado-based adventure tour operator Duke Bradford.
Bradford had founded Arkansas Valley Adventures (AVA) in 1998.
Currently, the company has 250 employees who provide outdoor experiences throughout the year, including guided, multi-day river rafting wilderness trips.
Because Colorado’s rivers go through federal land, rafting businesses such as AVA require special use permits from the federal government.
The businesses pay the government a percentage of service fees and receive an annual lease to conduct rafting trips on lands owned or managed by the federal government.
Bradford claims that the federal minimum wage mandate—which would break his company—shouldn’t apply to his company because it is not, nor has it ever been, a federal contractor.
His attorney, Caleb Kruckenberg of national not-for-profit public interest law firm Pacific Legal Foundation, hailed the appeals court ruling that halts the mandate against the entire outdoor industry while the federal lawsuit continues.
“This ruling helps more than 40,000 companies like Arkansas Valley Adventures who provide seasonal recreational services on federal lands,” the lawyer said in a statement.
“The court recognized that this wage rule doesn’t make sense for the industry, would limit access to the outdoors, and would reduce employment opportunities for people in the industry.
“More importantly, the court also recognized that the president did not have the authority to issue the rule.”
On Nov. 23, 2021, the U.S. Department of Labor issued a rule to enforce the order effective Jan. 30, 2022, but included all businesses that hold a special land use permit to operate on federal lands.
Overall, the mandate covers an estimated 500,000 businesses that employ one-fifth of the nation’s labor force.
The legal complaint (pdf) in the case, Bradford v. U.S. Department of Labor, court file 1:21-cv-3283, was filed Dec. 7, 2021, with the U.S. District Court for the District of Colorado.
Executive Order 14026, which Biden signed on April 27, 2021, directs all federal contractors to pay a $15-per-hour minimum wage, plus overtime.
The order applies to any “contract or contract-like instrument entered into with the Federal Government in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public.”
Biden’s order revoked Executive Order 13838, which President Donald Trump had signed in May 2018.
Trump wished to make it clear that recreational service providers using federal lands shouldn’t be subject to a federal minimum wage mandate.
In his order, Trump stated that such a mandate “threatens to raise significantly the cost of guided hikes and tours on Federal lands, preventing many visitors from enjoying the great beauty of America’s outdoors.
“Seasonal recreational workers have irregular work schedules, a high incidence of overtime pay, and an unusually high turnover rate, among other distinguishing characteristics.”
But Biden, who assumed office in January 2021, apparently disagreed with Trump’s rationale and issued the wide-ranging Executive Order 14026, which failed to maintain an exemption for recreational service providers.
On Jan. 24, Philip Brimmer, chief judge of the U.S. District Court for the District of Colorado, who was appointed by President George W. Bush, turned down (pdf) the application for an injunction, but he was overruled by an appellate court on Feb. 17.
The two-judge panel of the Denver-based U.S. Court of Appeals for the 10th Circuit consisted of Judge Paul Kelly, who was appointed by President George H.W. Bush, and Judge Gregory Alan Phillips, who was appointed by President Barack Obama.
The panel determined in its order (pdf) that the plaintiffs “have demonstrated an entitlement to relief from the Minimum Wage Order in their particular circumstances.”
The appeals court stated it would “enjoin the government from enforcing the Minimum Wage Order in the context of contracts or contract-like instruments entered into with the federal government in connection with seasonal recreational services or seasonal recreational equipment rental for the general public on federal lands.”
The “injunction shall remain in force until further order of this court,” the panel wrote.
The injunction came after five states filed a separate lawsuit (pdf) in federal court in Arizona on Feb. 9 challenging Biden’s minimum wage increase for federal contractors.
The attorneys general of Arizona, Idaho, Indiana, Nebraska, and South Carolina, argued in their suit that Biden lacked statutory authority to mandate the minimum wage hike when he signed Executive Order 14026.
The attorneys general stated that Biden was trying to accomplish by executive fiat what Congress refused to approve.
The U.S. Senate rejected Biden’s request to include the $15 per hour wage increase in the coronavirus relief package, in a lopsided 42–58 vote, they noted.