Government Agency Calls for End to Program Allowing Subminimum Wages for People with Disabilities

A federal agency has called on the government to end a program that explicitly permits employers to pay hundreds of thousands of people with disabilities less than $1 an hour, calling the practice “rife with abuse and difficult to administer.”

The federal minimum wage has stood at $7.25 since 2009, although many states have enacted their own higher minimum wages. Certain employers, however, may request certificates from the Department of Labor authorizing them to pay employees with disabilities less than the minimum wage, called a “subminimum" wage. The certificate is known as a 14(c) waiver, referring to the provision of the Fair Labor Standards Act of 1938 that authorizes such waivers.

The program’s original purpose was to provide job opportunities for people considered unemployable because of their disabilities. However, the program is now widely viewed as exploitative. (Reports documenting extensive subminimum wage abuse can be read here and here.)

In a massive new report released September 17, 2020, and titled “Subminimum Wages: Impacts on the Civil Rights of People with Disabilities,” the federal U.S. Commission on Civil Rights blasts both the Department of Labor and the Department of Justice for failing to adequately monitor the 14(c) program.

The Commission’s top recommendation is that the federal government phase out the 14(c) certificates altogether — following the lead of a few states that have done so — in favor of “alternative service models prioritizing competitive integrated employment.”

The Commission also finds that people employed by 14(c) certificate holders, who number more than 420,000 nationwide, are “not categorically different” from other people with disabilities. It notes that the Americans with Disabilities Act requires states to integrate their workforces, and thus 14(c) certificates may now violate the Act.   

“The Commission’s research shows that Section 14(c) is antiquated as it was enacted prior to our nation’s civil rights laws, and its operation in practice remains discriminatory by permitting payment of subminimum wages based on disability without sufficient controls to ensure that the program operates as designed . . . ” the report states. “Although Congress enacted the program with good intentions, the Department of Labor’s enforcement data as well as several key civil rights cases and testimony from experts show that with regard to wage disparities, the program is rife with abuse and difficult to administer without harming employees with disabilities.”

Disability rights advocates hailed the report.  “We are thrilled to see the U.S. Commission on Civil Rights calling for an end to the 14(c) waiver program,” Rebecca Cokley, director of the Center for American Progress’ Disability Justice Initiative, told The Hill. “This program has existed for over 80 years to transition disabled people to competitive fair wage jobs, with less than a 5% success rate.”  

The U.S. Commission on Civil Rights is an independent, bipartisan federal agency created by Congress in 1957 and tasked with issuing recommendations on federal civil rights policy.

Click here to read the full 349-page report.