The Biden administration’s Department of Labor is phasing out a controversial program that allows some employers to pay disabled workers less than the federal minimum wage, the department announced Tuesday.
The measure, introduced in 1938 during the final years of the Great Depression, was intended to increase employment opportunities for workers with disabilities but was denounced by advocates who say it amounts to legalized discrimination. The measure is part of the Fair Labor Standards Act and is based on the premise that employers with disabilities are less productive.
The Ministry of Labor proposed rule would phase out subminimum wages by ending the issuance of certificates allowing lower wages and introducing a three-year period during which employers can stop using existing certificates.
“One of the guiding principles of the American workplace is that a hard day’s work deserves a fair day’s pay,” Wage and Hour Administrator Jessica Looman said in a statement. “Opportunities and training have expanded dramatically to help people with disabilities obtain and maintain employment at or above the full federal minimum wage.”
About 40,000 American workers with disabilities currently receive less than the federally mandated minimum wage of $7.25 per hour. Some work through nonprofit organizations that seek to provide opportunities for people with autism, cerebral palsy or other disabilities.
According to documents obtained by BloombergSome employers have paid workers as little as 25 cents an hour to sort clothes and 5 cents an hour to cut rags. The first certificates allowing subminimum wages were issued half a century before the Americans with Disabilities Act was passed in 1990.
The Department of Labor expects workers currently paid subminimum wages to move to full-wage positions rather than face unemployment, Acting Secretary Julie Su said in a statement statement.
The abolition of low wages will “strengthen the inclusion of people with disabilities in the labor market” and “improve their economic well-being,” Su said.
The decision to phase out the Great Depression-era program is based largely on evidence that legal and policy changes in recent years have lowered barriers to employment for people with disabilities. Under the Department of Labor’s proposed rule, authorization to pay low wages is no longer necessary to incentivize employers to hire a disabled person.
“Employment opportunities for people with disabilities have increased dramatically in recent decades,” the rule says. “The ministry has provisionally concluded that subminimum wages are no longer necessary to prevent the curtailment of employment.”
The fate of the program will rest with newly elected President Donald Trump, who takes office next month. During Trump’s first term, his administration worked to roll back existing labor mandates and increase corporate discretion over a range of issues.
Some Republican lawmakers have raised alarms about the possible elimination of a subminimum wage a letter told Su last December that lower wages allow people with disabilities to work and move to better-paying jobs. Representative Virginia Foxx of North Carolina and Trump ally Elise Stefanik of New York were among the eight signatories.
The letter, along with some parents of disabled adults, expressed support for so-called sheltered workshops that employ disabled workers and pay them less than $7.25.
“For many Americans with disabilities, these centers provide a unique sense of purpose and community,” the letter said.
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This story originally appeared in the Los Angeles Times.
