Fair Pay for Federal Contractors Act of 2025
Summary
The Fair Pay for Federal Contractors Act of 2025 aims to provide back pay to federal contractors whose work was impacted by government shutdowns. It appropriates funds for fiscal year 2026 to compensate contractors for costs incurred due to the lapse in appropriations, specifically covering employee compensation and restoration of paid leave. The act also mandates a report on the adjustments made, detailing the number of affected employees and the compensation provided.
Expected Effects
This act will likely result in federal contractors receiving compensation for losses incurred during government shutdowns, ensuring their employees are paid for lost work. It could also incentivize contractors to maintain their workforce during future shutdowns, knowing they will be reimbursed. The appropriated funds will be available until December 31, 2026.
Potential Benefits
- Provides financial relief to federal contractors and their employees affected by government shutdowns.
- Ensures that employees receive compensation for lost wages or benefits during periods of lapsed appropriations.
- Stabilizes the federal contracting workforce by reducing the financial impact of government shutdowns on contractors.
- Potentially improves morale and productivity among federal contractor employees.
- Reduces the risk of project delays or disruptions due to workforce instability during shutdowns.
Potential Disadvantages
- Increases government spending and may contribute to the federal deficit.
- May create administrative burdens for federal agencies in processing and disbursing the back pay.
- Could incentivize contractors to become overly reliant on government bailouts during shutdowns.
- The cap on weekly compensation may not fully cover the losses of higher-paid employees.
- Potential for disputes over the eligibility and amount of compensation.
Most Disadvantaged Areas:
Constitutional Alignment
The act aligns with the Constitution's Article I, Section 8, which grants Congress the power to appropriate funds for the general welfare. It also relates to the Fifth Amendment's Due Process Clause, as ensuring fair compensation to contractors for work disrupted by government actions can be seen as a matter of fairness and preventing unjust enrichment of the government at the expense of private entities. The act does not appear to infringe upon any specific constitutional rights or limitations.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).