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The Disgrace of Sub-minimum Wages

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By Blaine Stum

Anyone who has worked a minimum wage job can tell you how grueling, and frustrating, the experience is. Despite its origins as a living wage, it has become anything but that. Workers are often forced to take on multiple jobs, delay necessary health care, and rely on social programs to get by. The minimum wage is supposed to be a floor, meaning employers cannot legally pay less. Except that is not true for everyone. There is a class of people employers may pay sub-minimum wages to with a waiver from the federal government: those with physical and intellectual disabilities.

Buried in the Fair Labor Standards Act is Section 14, which states, “the employment of individuals whose earning capacity is impaired by age or physical or mental deficiency… under special certificates issued by the Administrator, at such wages lower than the minimum wage… and for such a period as shall be fixed in such certificates.” In non-legalese, this means that employers can petition for a waiver to pay people with physical and intellectual disabilities less than minimum wage. The reasoning behind the exception was just what you might expect: legislators and employers believed a reduced wage option for people with physical and intellectual disabilities was warranted because they were not (and could not be expected to be) “as productive as normal employees.”

When it was passed in 1938, Section 14 included a wage floor of no less than 75 percemt of minimum wage, but that floor was eroded by two subsequent changes to the law. In 1966, the wage floor was brought down to 50 percent of minimum wage. Then in 1986, the wage floor was removed entirely when Congress quickly acted to pass a proposal by Senator Howard Metzenbaum (D-OH). The law remains unchanged to this day. The most recent statistics show about 3,400 employers have these certificates, covering an estimated 420,000 disabled workers. Companies who rely on the certificates include: Goodwill, the Artisans Ark, SKILS’KIN and Work Activity Center. Surveys have found that, in facilities where most or all workers have disabilities, 51 percent of those employees who fall under Section 14 make less than $2.50 an hour. In facilities where most employees are not disabled, 42 percent of employees covered by Section 14 make between $1 an hour to $7.25 an hour.

Problems with Section 14 have been known for years: Disabled workers are rarely paid wages “commensurate with their productivity,” sheltered workshops such as Goodwill do not enhance future employment outcomes for those who work there and do not provide disabled workers with greater opportunity to integrate into the workforce outside those workshops. The reason this archaic, exploitative law has yet to phased out is in part due to push back from employers like Goodwill, whose CEO famously stated that for people with disabilities work is more about “fulfillment” than pay. The fact that someone can still make that kind of paternalistic argument  provides a window in to the disgrace of how we treat those with disabilities and shows how far we still have to go to make it right.



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