Victims of the Exemption

Blog Date: 
Monday, April 22, 2013

By Anil Lewis

 
Section 14(c) of the Fair Labor Standards Act exempts over three thousand employers from paying their workers with disabilities the federal minimum wage, allowing them to pay workers subminimum wages as low as three cents per hour.  The Fair Wages for Workers with Disabilities Act of 2013 will repeal this unfair, discriminatory, and immoral provision.  The employers paying a subminimum wage argue that, once the Fair Wages for Workers with Disabilities legislation passes, the increase in wages would create a financial hardship that would force them to terminate employees or go out of business.  This argument is an attempt to frame the employers as victims, but instead highlights the perverse nature of the existing subminimum wage provision authorized by Section 14(c) of the Fair Labor Standards Act.  Rather than adopting a proven successful business model in which workers with disabilities are paid the minimum wage or more, subminimum wage employers are exempted from being responsible creators of real opportunities for integrated employment at competitive wages.
 
Subminimum wage employers cannot properly claim to be victims when they receive revenue beyond the income generated from the actual productivity of the worker with a disability.  These entities receive public funding, charitable contributions, non-profit tax status, preferred contracts, and more, all before their workers produce one product or provide a single service.  The employers receive these benefits because they cultivate the perception that they are performing a service to people with disabilities. So although the employer argues that it is paying the worker based on productivity (which is itself a fallacy), the worker is not being paid consistent with all of the revenue being generated as a result of the worker’s participation.  It is important to understand that these employers would lose this revenue, and the goodwill that generates it, if they terminated their workers with disabilities. Therefore, it is very unlikely that they would terminate employees who generate revenue through their mere presence.  It is simply unfair for the subminimum wage employer to continue to use the threat of termination of employees with disabilities to justify their continued exploitation of this labor source.  
    
Moreover, it should be obvious that any business unable to remain lucrative with public and private money constantly flowing into its coffers, while paying the employees at least the federal minimum wage, should not be in business at all.  The failure of such an entity would be the result of poor management, not the payment of competitive wages or the incapacity of its workers with disabilities.  Such shoddy operations should not be subsidized by a federal law that allows the managers of these businesses to exploit workers with disabilities by using them as a fundraising resource, as a justification for the lavishing of federal largesse, and as sweatshop laborers.  
 
Some subminimum wage employers feel they are excused from paying better wages because workers with disabilities choose to work in this subminimum wage environment and to receive Social Security and other public benefits to subsidize their wages.  Working for pennies per hour or fully participating in the workforce cannot realistically be considered a choice.  Society would never consider establishing federal law that allows other American citizens the choice to work for subminimum wages and collect public benefits, while supplementing the employer's revenue with public funds.
 
It is important to understand that as long as we promote the illusion that subminimum wage work is a job, we deny these individuals access to the proper training, support, and opportunity to obtain real jobs at real wages.  The existing resources currently being used to keep these individuals in segregated subminimum wage pseudo-work environments should be concentrated on finding them real jobs that pay real wages, or on training them for such jobs.  
 
Some still argue that there are those individuals who are so severely disabled that they cannot be competitively employed.  New strategies evolve every day that prove this statement to be false.  Many individuals with significant disabilities, previously labeled unemployable by sheltered workshops, have received job training from qualified professionals that used innovative strategies to assist them in obtaining competitive integrated employment.  And if there are truly individuals too severely disabled to perform competitive work, it does not follow that employment at subminimum wages is the best outcome for these individuals.  There is a better reality that we can provide for these individuals than toiling away, day after day, for pennies an hour.  
 
The Fair Wages for Workers with Disabilities Act of 2013 (H.R. 831), which will phase out Section 14(c) of the Fair Labor Standards Act, has a phase-in period and provides incentives to these businesses to adopt a new business model that truly benefits the worker with a disability while allowing the businesses to remain profitable.  It should be noted that many employers of people with disabilities, including nonprofits that hold or have held special wage certificates, have already changed their policies to pay their workers the federal or state minimum wage or higher.  These entities are still operating and in fact thriving.  Continuing to exempt employers from paying workers with disabilities the federal minimum wage victimizes workers with disabilities, not their purported employers.