Jan 30, 2024 - News

Utah rejects equal pay for workers with disabilities

Illustration of half-coins falling into a woman's hand.

Illustration: Maura Losch/Axios

Utah lawmakers recently killed a proposal to require Utah employers to pay at least minimum wage to workers with disabilities.

By the numbers: About 600 Utahns with disabilities are paid less than minimum wage, per federal records.

State of play: According to federal labor laws written in the 1930s, employers may pay less than minimum wage to workers whose disabilities cause reduced "productive capacity."

  • Under the exemption, known by labor regulators as the "14(c) program," most affected workers are paid less than $3.50 an hour, a 2023 federal report reveals. There is no minimum required wage for 14(c) workers.
  • Most employers that are authorized to pay lower wages are "community rehabilitation programs" designed to provide work experience to adults with disabilities.

Yes, but: The exemption's stated goal is to increase opportunities for workers with disabilities to get jobs at equal pay, alongside workers without disabilities. That's not actually happening — nor is it required of employers.

  • "It's possible for an employee to be paid subminimum wage indefinitely, without any assurance they are building skills," said Andrew Riggle, public policy advocate for the Disability Law Center. "As a result, many individuals with disabilities languish in segregated settings making cents on the dollar, year after year."
  • Only 12% of 14(c) workers nationally were transitioning to fully-paid jobs, researchers found in a 2021 Government Accountability Office survey.

The latest: A Utah bill to phase out disability-related "subminimum" wages failed last week in a 3-6 vote by a state House committee.

  • One Republican joined the two Democrats in supporting the measure; the rest voted against it.

The big picture: The number of 14(c) employees has dropped more than 50% nationwide since 2010 as states impose their own limits.

  • Sixteen states have banned or begun to eliminate the exemptions.
  • While most of those states lean blue, Alaska and Tennessee have banned the practice; South Carolina and Virginia are phasing it out, and Texas forbids public contracts with employers that claim the exemption.

The other side: The lower required wages have enabled employers to hire workers with disabilities "out of the kindness of their hearts," said Rep. Calvin Musselman (R-West Haven), who argued higher wages will put that employment at risk.

Reality check: Employment rates rose for people with disabilities in the four states that banned the exemptions between 2015 and 2019, said the bill's sponsor, Rep. Brett Garner (D-West Valley City).

Between the lines: In the decade ending in 2021, federal investigators found employers owed $15 million in wages to workers who were either not paid for with their actual productivity or didn't receive required training and support that might have helped them reach full wages.

What they're saying: The wage exemption "hinges on stereotypes about mobility and productivity that I don't think are justified," Garner said. "We need to say that as a state we're not going to let this be something that holds people down."

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