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Some Disabled People Are Paid Below Minimum Wage. This Bill Would End That.

A group of lawmakers in Congress is vying to end subminimum wages for disabled people, a policy that affects about 122,000 individuals nationwide.

The minimum wage for employees in the U.S. ranges from $7.25 to $15 per hour, and many activists are continuously fighting to increase that amount. But currently, some employers can pay disabled people far below state minimums, with many earning less than $3.50 an hour, according to a report by the U.S. Government Accountability Office.

On Feb. 27, a group of bipartisan senators and representatives reintroduced the Transformation to Competitive Integrated Employment Act, which would end that practice.

“Paying workers less than the minimum wage is unacceptable. Everyone deserves to be paid a fair wage, and Americans with disabilities are no exception,” Sen. Bob Casey (D-Pa.), who led the legislative effort, said in a statement. “This commonsense, bipartisan bill would lift up people with disabilities by raising their wages and creating competitive jobs in workplaces that employ both workers with and without disabilities.”

Under Section 14(c) of the Fair Labor Standards Act, employers can apply for a certificate from the Department of Labor that would permit them to pay disabled employees below the minimum wage. The GAO reported that 1,567 employers did just that in 2019.

Disabled employees’ subminimum wages are determined by time trials that their employers administer every six months to compare their work output and productivity to that of non-disabled employees.

“For employees, there’s an extreme amount of stress. They’re being tested every six months, and if they don’t perform at a certain level, their pay is cut,” explained Jewelyn Cosgrove, vice president at the Washington, D.C., area disability nonprofit Melwood.

Tawana Freeman, a 52-year-old disabled woman, began working at Melwood in 1996, back when the nonprofit had a 14(c) certificate and paid subminimum wages to disabled employees. As a single mother of three children at the time, she remembers feeling immense pressure to perform well for the time trials every six months to avoid pay cuts.

“I was like ‘No, I can’t fail. I gotta prove myself, I gotta make them know that I’m worthy,’” Freeman told HuffPost.

Freeman said her pay was cut several times, forcing her to rely on her family and friends to help her pay her bills. She still works at Melwood, but no longer has to endure time trials and subminimum wages since the nonprofit voluntarily surrendered its Section 14(c) certificate in 2014 after becoming aware of its detrimental effect on disabled employees.

“Oh, I feel wonderful. I don’t have to ask anyone for money. I know what I’m getting … so I’m OK now,” Freeman said. “We feel normal, like we’re regular work people [who] go into work and get paid for our eight hours, and it feels wonderful.”

The History Of Subminimum Wages

Melwood President and CEO Larysa Kautz noted that for a long time, society saw disabled people as untrainable and unemployable. Disabled people, especially those with intellectual, cognitive and developmental disabilities, were seen as inferior because of the way their disabilities present themselves, and subminimum wages were used as an incentive for employers to hire them.

“[Section 14(c) is] an antiquated law that was put in place in the 1930s because frankly, nobody thought at that time that a person with a disability could do ‘real work,’” Kautz told HuffPost.

“It was well-intentioned. It was done because we as a society thought that no one would ever hire someone with a significant disability — or any disability, really, because it doesn’t have to be significant — unless there was an incentive for that employer to do so,” she continued.

Proponents of subminimum wages today believe they are the only choice for disabled people and that without them, these employees will lose their source of income, Kautz said.

But the landscape has changed drastically in the 21st century, with more employment opportunities and alternatives available than in 1938 when the Fair Labor Standards Act was passed.

The U.S. has seen tremendous improvements in assistive technology and other tools that can assist disabled people in the workplace over the past few decades. And in 2014, the Workforce Innovation Opportunities Act ensured that job-seekers — including disabled people — have access to employment, training and support services to help them succeed in the labor market.

“Being allowed to continue to rely on some of these old laws instead of moving into the future and into where we are currently doesn’t serve people with disabilities well. It just gives another reason to discriminate and set them aside and not try to find solutions and break down barriers,” Kautz said.

The Fight To Eliminate Subminimum Wages

There have been attempts to eliminate the subminimum wage for disabled people on a federal level. In July 2022, the AbilityOne federal program, which is one of the largest sources of employment for disabled people, eliminated the use of 14(c) subminimum wages within the program.

But the Transformation to Competitive Integrated Employment Act, which was initially introduced in 2021, would have the broadest impact of any effort to end the subminimum wage.

Eliminating the discriminatory practice would help disabled people reach financial independence and engage in their communities more as they transition to competitive employment and integrated work environments.

The legislation currently has the bipartisan support of Sens. Casey and Steve Daines (R-Mont.) and Reps. Bobby Scott (D-Va.) and Cathy McMorris Rodgers (R-Wash.). Despite the bipartisan coalition for this bill, Cosgrove said she’s skeptical that the legislation will pass in the current political environment.

And if it doesn’t pass, it will be up to individual states to eliminate 14(c) certificates.

Some states have started to lean away from the 85-year-old law. According to the Association of People Supporting Employment First, 13 states in the U.S. have passed legislation to eliminate subminimum wages for disabled people, with legislation pending in Virginia and other states.

The GAO also found that between 2010 and 2019, the number of employers authorized under Section 14(c) to pay subminimum wages decreased by half. With a number of states eliminating 14(c) certificates amid this growing trend, Cosgrove believes the subminimum wage policy will be gone in the next five years.

“I think this policy is going to go away, and I think at some point, the political calculus of it being a problem to get rid of it is going to go away as well,” Cosgrove said.