Overview - Living Wage for State Service Contracts
Overview
In 1994, Baltimore was the first city to enforce the Living Wage Law. Since then, over 140 cities throughout the United States have joined forces and created a Living Wage movement in their areas, and the numbers continue to grow both in the U.S. and on international soil.
Living Wage Rate
Current Living Wage Rate
The Living Wage rates change each year based upon the changes in the Consumer Price Index. New rates are published at the beginning of the State’s fiscal year in July and become effective 90 days from the end of the state fiscal year in June. View exemptions.
State law requires that contractors and subcontractors pay each covered employee at least the higher of the State or local minimum wage rate, or the minimum Living Wage rate established for the applicable Tier area. Offerors, contractors and subcontractors should be aware of the current State and local minimum wage rates, and the planned increases to those rates in the future.
Effective 12:01 a.m. on September 29, 2025, the Living Wage rates will be adjusted to $17.17 per hour in Tier 1 areas except for Montgomery County. Effective July 1, 2025, large employers (those with 51 or more employees) must pay a minimum wage of $17.65 per hour for any work performed in Montgomery County. For all non-Tier 1 areas, employees must be paid at least $15.00 per hour.
- Tier 1: Anne Arundel County, Baltimore City, Baltimore, Howard, Montgomery, and Prince George’s Counties
- Tier 2: Any county in the State not included in the Tier 1 area
Living Wage Law
What is the Living Wage Law?
The Living Wage Law requires certain contractors and subcontractors working on State funded service contracts to pay their employees an hourly rate that meets or exceeds the living wage rate established by the Commissioner of Labor. The Living Wage law applies to certain employees working on service contracts valued at $100,000 or more or $500,000 or more if the employer has 10 or fewer employees.
When this law was passed, the Maryland legislature required the Commissioner of Labor and Industry to adjust the wage rates each year based on the Consumer Price Index and to allow certain reductions to the wage rates.
Services Covered Under the Law
Under the Living Wage Law, services covered include maintenance services and information technology services. However, services NOT included are construction, construction-related services, architectural and engineering services, energy performance contracts, supplies (including commodities and printing), real property, or the purchase of goods.
Services Exempt from the Living Wage Law
For additional information, contact:
Division of Labor and Industry
Living Wage for State Service Contracts
10946 Golden West Drive, Suite 160
Hunt Valley, MD 21031
410-767-2232
e-mail: dldlilivingwage-labor@maryland.gov
Ayuda en Español: Jose Ruiz, 410-767-2370