Wages

The U.S. Department of Labor (DOL) announced a proposed rule that would phase out the issuance of certificates allowing employers to pay some workers with disabilities less than the federal minimum wage, currently $7.25 per hour, for the work they perform.

The rule proposes to gradually eliminate certificates employers can apply for under Section 14(c) of Fair Labor Standards Act that allow them to pay certain workers with disabilities subminimum wages. The department proposes to discontinue the issuance of new certificates and establish a three-year phase-out period for employers with existing certificates once a final rule becomes effective.

“In the decades since Section 14(c) was included in the Fair Labor Standards Act, there have been significant legal and policy developments that have dramatically expanded employment opportunities and rights for individuals with disabilities,” says Acting Secretary of Labor Julie Su. “With this proposal, the department expects that many workers currently paid subminimum wages under Section 14(c) will move into jobs that pay full wages, which will improve their economic wellbeing and strengthen inclusion for people with disabilities in the workforce.”

The proposed rule would do the following:

  • Cease the department’s issuance of new Section 14(c) certificates starting on the effective date of a final rule.
  • Institute a three-year period beginning on the effective date of a final rule for employers holding existing Section 14(c) certificates to gradually cease paying subminimum wages to workers with disabilities.

 

“One of the guiding principles of the American workplace is that a hard day’s work deserves a fair day’s pay, and this proposal ensures that principle includes workers with disabilities,” says Wage and Hour Administrator Jessica Looman. “Since the enactment of the Fair Labor Standards Act in 1938, opportunities and training have dramatically expanded to help people with disabilities obtain and maintain employment at or above the full federal minimum wage. Similarly, employers today have more resources and training available to recruit, hire and retain workers with disabilities in employment at or above the full minimum wage, and this proposed rule aligns with that reality.”