Glossary
Wage pass-through
A clause allowing a mandated wage increase to move the customer price, on a stated formula and notice.
A wage pass-through responds to a legal wage change: a state or city minimum wage, or sometimes a prevailing-wage determination. It is not a right to raise prices because hiring got harder. If the statute did not move, the clause does not move.
The formula is in the contract. Common shapes: the percentage change in the wage, multiplied by a labor factor the contract states; or the dollar wage increase times the hours worked, plus a stated burden and markup. A labor factor of 0.60 means 60% of the fee, because the contract said 0.60, not because 60% is typical. RateClause does not assume a labor share.
The wage's effective date and the invoice's effective date are different. January 1, 2026 wage steps needed notice in 2025 if the clause required 30 or 60 days. Florida's September 30, 2026 step needed notice in August. As of November 1, 2026 those windows are closed. The next January 1, 2027 window is open or closed depending on the number of days.
Apply the wage that applies to that workplace. Statewide figures are wrong for a city with a higher ordinance, and the standard New Jersey schedule is wrong for a long-term-care or small-employer schedule. The state guides on this site cite the sources and the places they differ.
Related terms
See it used in a worked example · CPI calculator · Request an audit
Sources and limits
Index levels from the U.S. Bureau of Labor Statistics Consumer Price Index, not seasonally adjusted, retrieved through the BLS Public Data API on November 1, 2026. Values are index points, not the headline 12-month percent.
Statewide rates reflect U.S. Department of Labor state minimum-wage postings as updated January 1, 2026, the U.S. Department of State Diplomatic Note on 2026 increases, and, for the prior-year comparison and named local rates, the National Employment Law Project compilation published in November 2025. Confirm the rate that applies to the workplace before using it in a bill.
The contracts in these worksheets are fictional. The prices are chosen so the arithmetic is easy to check. They are not a price survey and they are not client results.
RateClause is not a law firm. Nothing on this page is legal advice. Your clause controls, including whether a past period can be rebilled at all.
Primary postings: BLS Consumer Price Index, U.S. Department of Labor, state minimum wages, U.S. Department of State notice of 2026 minimum-wage increases.