Biden seeks to end subminimum wages for workers with disabilities
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Workers with disabilities can be paid less than minimum wage, but the Biden administration moved to end the practice on Tuesday.
Why it matters: Higher wages are generally good for workers.
- The exemption is a relic of a time when people with disabilities were broadly segregated from the rest of society and discrimination against them was not illegal.
Zoom in: The number of people with disabilities earning a subminimum wage, through what's known as a 14(c) certification issued by the Labor Department, has been declining for years.
- The median hourly wage for these folks was $3.46 as of May, per the department's analysis. (The federal minimum wage is $7.25 an hour.)
- The overwhelming majority of employers that are paying below minimum wage are nonprofit community rehabilitation programs that serve people with disabilities, typically in shelters or segregated settings.
Stunning stat: 10% of these workers earned $1 an hour or less in parts of 2023 and 2024, the Labor Department says.
The big picture: This is the culmination of years of change in the culture, says Katherine Gallagher Robbins, a senior fellow at the National Partnership for Women & Families.
- The vast majority of these workers have intellectual or developmental disabilities. Over the past decade or so, they've been more integrated into our communities, she says.
Meanwhile: 15 states, blue and red, have passed laws eliminating the subminimum wage for workers with disabilities. Many employers are phasing them out too.
- Some initial research finds that employment levels for workers with disabilities actually go up when the low wage is abolished.
- The employment rate for workers with disabilities reached a record high last year — though it's fallen a bit since.
The other side: Supporters of the exemption argue it offers more job opportunities for those who wouldn't normally have them.
What's next: The Labor Department, which has been working on this for the past year, is accepting comments on the proposed rule until Jan. 17 — days before President-elect Donald Trump takes office.
- He could easily make sure it never goes into effect.
Between the lines: It is unclear where the incoming administration would stand — they didn't respond to an emailed request for comment — but Republican lawmakers have fought efforts to pass legislation ending the exemption.
- The timing could just be an effort to get this rule on the record and get comments from the community, says Bart Devon, executive director of the Alliance for Expanding America's Workforce, which advocates for employment for those with disabilities.
The bottom line: Even without an official rule, a subminimum wage for those with disabilities is slowly becoming a thing of the past.
