The U.S. Department of Labor has proposed a rule to phase out certificates that permit employers to pay workers with disabilities less than the federal minimum wage of $7.25 per hour. (All figures U.S.)
The proposed rule would discontinue the issuance of new certificates under Section 14(c) of the Fair Labor Standards Act and establish a three-year phase-out period for employers holding existing certificates once the final rule becomes effective.
“This proposal demonstrates the Biden-Harris administration’s dedication to good jobs for workers with disabilities,” said Acting Secretary of Labour Julie Su. “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.”
“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 well-being and strengthen inclusion for people with disabilities in the workforce,” Su said.
Under the proposed rule, the department would cease issuing new Section 14(c) certificates starting on the effective date of the final rule and institute a three-year period for employers with existing certificates to gradually cease paying subminimum wages.
“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,” said 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,” Looman said.
“The Biden-Harris administration is committed to creating a more inclusive workforce, where individuals with disabilities can thrive without being held back,” said Assistant Secretary of Labour for Disability Employment Policy Taryn Williams. “This proposal would help ensure that workers with disabilities have access to equal employment opportunities while reinforcing the fundamental belief that all workers deserve fair compensation for their contributions.”
On Sept. 26, Acting Secretary Julie Su announced that the department would conduct a comprehensive review of the Section 14(c) program. As part of this review, the department held a series of stakeholder engagement sessions to hear diverse views from the public, including workers with disabilities and their family members, disability rights advocates, service providers and Section 14(c) certificate holders.
The department is encouraging interested parties to submit comments on the proposal once it is published in the Federal Register. Comments must be received by 11:59 p.m. EST on Jan. 17, 2025, for consideration in this rulemaking.
