DIEP RRTC

Issue #4 (October 2021)

Welcome

Welcome to the fourth issue of the Disability Inclusive Employment Policy RRTC Newsletter.  Previous newsletters are  available online.

Today’s unprecedented health, social, and economic challenges raised by the coronavirus pandemic require a retrospective, present-day, and prospective view of U.S. employment policy for individuals with disabilities. Over the next five years, the goal of the Rehabilitation Research and Training Center (RRTC) on “Disability Inclusive Employment Policy” (DIEP) will be to design and implement a series of studies that produce new data and evidence on policy levers to increase employment rates of persons with disabilities with the objective of informing current and future policy and program development. This project is a collaboration between Syracuse, Harvard, and Rutgers universities.

Invite others to receive this quarterly FREE newsletter to stay updated on the latest employment policy research related to advancing economic stability, and security for youth and adults with disabilities.

Federal Disability Inclusive Employment Policy Update

Authors: Prepared by APSE, a DIEP Knowledge Translation partner
The summer months were a busy time focused on pushing forward President Biden’s The Build Back Better Agenda. The American Jobs Act and other legislative initiatives currently in Congress have the potential to significantly impact the employment of people with disabilities.

  • Beginning negotiations and drafting of legislative language, all under the broad umbrella of infrastructure spending, have been focused in two areas:
  • Infrastructure Investment and Jobs Act -traditional infrastructure package
  • The American Jobs Plan -social infrastructure package
  • Includes funding to phase out of 14c, expand HCBS services, etc.

View full presentation

Research Spotlight -14(c) and subminimum wage

Michael Morris, J.D.-DIEP Director of Knowledge Translation and Sr. Advisor, Burton Blatt Institute
The latest US Department of Labor (US DOL) data at the end of September 2021 indicates that the participation rate in the labor force for working-age people with disabilities was at 36.4 percent, up 2.2 percent from the prior month of August, which is now surpassing pre-pandemic levels. Workers with disabilities represent 3.7 percent (5.2 million) of the total of 143.5 million workers in the United States.

The RRTC on Disability Inclusive Employment Policy will be examining a number of factors that have and may continue to influence labor force participation by people with and without disabilities. COVID-19 has created a unique environment to study impacts of select employment policies at a state and federal level on people with disabilities. Have federal supplemental unemployment benefits influenced decisions for individuals with disabilities not to return to work? Have employer policies to allow more flexibility for working from home influenced greater tolerance and acceptance for telework for employees with disabilities? In addition to these questions, debate continues on the economic consequences of raising the minimum wage on employer decisions to reduce the size of their workforce. 

In an area of more specific disability consequences, the pressure continues from national disability organizations to eliminate the possibility of workers with disabilities being paid a subminimum wage based on productive capacity being limited by a physical or mental disability. Since 1938, the Fair Labor Standards Act has allowed employers to receive a 14(c) certificate that makes it legal to have them pay individuals with disabilities a subminimum wage. Recent data from the US Department of Labor’s Wage and Hour Division, which oversees the 14(c) program, indicates that more than 43,900 workers with disabilities are employed under this program, with over 700 employers nationwide who had successfully applied for 14(c) certificates. Employers must pay a “commensurate wage” under 14(c), which is determined through time studies to evaluate the worker’s productivity. US DOL has found, during the past 15 years, frequent violations by employers with 14(c) certificates. President Biden has asked Congress to eliminate the subminimum wage option for workers with disabilities and bills are pending before Congress to accomplish this objective. In the meantime, states have moved forward with laws and rules passed to eliminate the option for employers to use a 14(c) certificate to pay subminimum wages to workers with disabilities.

This edition of the DIEP newsletter features articles and more information that explain the current status of 14(c).
Bloomberg Law presents a good Overview of 14(c) with a quote by DIEP’s Principal Investigator, Peter Blanck

Douglas Kruse, PhD-DIEP Co-Principal Investigator and Distinguished Professor, Rutgers University.  
Led by the disability community, there has been growing political pressure over the past two decades to eliminate the subminimum wage program for people with disabilities.  The 1938 Fair Labor Standards Act, which established the minimum wage, includes Section 14(c ) which allows people with disabilities to be paid a subminimum wage in certain circumstances.  The wage must be based on physical productivity of the worker relative to the productivity of an experienced worker without a disability on the same set of tasks.  Employers can pay qualified workers this way only after receiving a certificate from the U.S. Department of Labor.  Most 14(c ) employment is in Community Rehabilitation Providers, more commonly known as “sheltered workshops,” and the typical worker is one with an intellectual or developmental disability.

Proponents of the 14(c ) program argue that subminimum wage work is appropriate for some people with significant disabilities who employers would not hire at a higher wage, and such work provides social and psychological rewards along with skills that may help the transition to competitive employment.  Critics argue that this program is discriminatory toward people with disabilities by not providing the same protections given to other workers.  They also argue that the measurement of productivity is often flawed, and supported competitive employment with standard labor protections is not only better for workers but also less costly for the government.

Starting with Vermont in 2002, states have been phasing out support for 14(c ) employment.  A recent report by APSE found that an additional 10 states have passed legislation eliminating 14(c ) employment, while two more have eliminated it for employers receiving state contracts.  Partly as a result of these policy changes, the total workers in 14(c ) employment decreased from a high of 424,000 estimated by the GAO in 2001 to just over 67,000 in 2020 as reported by APSE. 

At the federal level, the National Council on Disability issued a 2012 report calling for the elimination of the program, and the U.S. Commission on Civil Rights issued a 2019 report concluding that the programs violates the civil rights of people with disabilities.  The 2014 Workforce Innovation and Opportunity Act took a number of steps to decrease 14(c ) employment, and President Obama signed a 2014 Executive Order that did not permit subminimum wages for federal contractors.  President Biden has proposed to fully eliminate this program.

Prior research has found that a) the wages of workers in sheltered employment have been decreasing over the past few decades, b) the “overwhelming majority” of workers in sheltered workshops would earn more in competitive employment, and c) being in a sheltered workshop does not increase one’s chance of finding competitive employment (Cimera 2011, 2012, 2017).

The DIEP RRTC will study the effects of both minimum and subminimum wages on the employment and earnings of workers with disabilities.  We will use variation among states and over time to do pre/post comparisons of disability employment and earnings before and after  state-level minimum wage changes and restrictions on the use of subminimum wages.

14(c) Policy Update from Association of People Supporting Employment First (APSE)

  • In September: Governor Newsome (CA) signed SB639 into law – making California the 9th state to legislatively phase out 14c.
  • In October Governor Pritzker (IL) signed Executive Order 2021-26, eliminating the use of subminimum wage in all state contracts employing people with disabilities.
  • Governor Carney (DE) signed HB122 into law – making Delaware the 10th state to legislatively phase out 14c.
  • To date: 10 states have enacted legislation to phase out 14c
  • In the 2021 legislative session: 13 states introduced legislation to phase out 14c and 5 states successfully passed laws

For more information read APSE’s white paper on the Trends and Current Status of 14(c)

List of organizations with 14(c) certificates
The Department of Labor provides a list of 14(c) Certificate holders


14(c) Research from the DIEP Team

Blanck, P. (2019). Why America is better off because of the Americans with Disabilities Act and the Individuals with Disabilities Education ActTouro L. Rev.35, 605. View Full text Peter Blanck’s article 
“The ADA’s “integration mandate” was affirmed by the U.S. Supreme Court in the seminal ADA Title II case Olmstead v L.C.  As akin to its predecessor in the area of race and education, Brown v. Board of Education, Olmstead mandates that state-sponsored separate and nonintegrated living arrangements may be discriminatory towards people with disabilities who desire and may live with appropriate supports in the community. Olmstead, like the IDEA’s public school mainstreaming presumption, rejects a belief that all children with disabilities learn best in separate classes, just as it rejects that individuals with disabilities may best advance vocational skills in segregated sheltered workshops. The Supreme Court concluded that unjustified separation from the community constitutes discrimination under the ADA.”


Interesting studies about 14(c) by other researchers

Cimera, R. E. (2017). The Percentage of Supported Employees With Significant Disabilities Who Would Earn More in Sheltered Workshops. Research and Practice for Persons with Severe Disabilities42(2), 108-120. Cimera article abstract 
This study examined the percentage of 21,257 supported employees served by 74 state-federal vocational rehabilitation agencies in 2013 who would have earned more wages in sheltered workshops than in the community. It found that the overwhelming majority of supported employees earned more in their communities at all wage comparison points; however, substantial differences in wages were identified according to the participant’s disability type, occupation, vocational rehabilitation agency, and the region in which they lived.

May-Simera, C. (2018). Reconsidering sheltered workshops in light of the United Nations Convention on the Rights of Persons with Disabilities (2006)Laws7(1), 6.
Full text May-Simera’s article During the Convention’s inception, negotiations circled around conflicting opinions as to the purpose, usefulness, and future of sheltered work, revealing the existing tensions between protection and autonomy, shrouding all disability policy discussions. As a result, the question of sheltered work is not explicitly addressed in the treaty and the Committee on the Rights of Persons with Disabilities have been unable to definitively declare that the practice of sheltered work constitutes an act of discrimination. However, the Committee does at times demand that sheltered workshops be phased out where it is obvious that the practice of sheltered work is directly linked to the exploitation of workers. Moreover, certain provisions in the Convention might help in determining wrongful discrimination in some, if limited, instances.

Friedman, C. (2019). Ableism, Racism, and Subminimum Wage in the United States. Disability Studies Quarterly39(4). Full text Friedman’s article  
As subminimum wage is a prominent and problematic issue affecting the lives of many people with disabilities in United States, and as it is linked to discrimination, the aim of this study was to explore how prejudice impacts the use of special wage certificates and subminimum wage across the United States. Since in the United States employment discrimination has historically been tied to racism and sexism, in addition to ableism, we also were interested in exploring how those factors may impact the use of special wage certificates. To do so, we analyzed data about the use of special wage certificates around the United States, and prejudice data from 4.70 million people. Our findings revealed significant links between subminimum wage and not only ableism, but also racism. Subminimum wage practices are discriminatory and help normalize oppression.

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DISCLAIMER The contents of this newsletter were developed under a grant from the National Institute on Disability, Independent Living, and Rehabilitation Research (NIDILRR grant number 90RTEM0006). NIDILRR is a Center within the Administration for Community Living (ACL), Department of Health and Human Services (HHS). The contents of this website do not necessarily represent the policy of NIDILRR, ACL, or HHS, and you should not assume endorsement by the Federal Government.”

About BBI
The Burton Blatt Institute (“BBI”) at Syracuse University reaches around the globe in its efforts to advance the civic, economic, and social participation of people with disabilities. Through program development, research, and public policy guidance, BBI advances the full inclusion of people with disabilities. BBI builds on the legacy of Burton Blatt, a pioneering disability rights scholar. BBI has offices in Syracuse, NY; Washington, DC; Atlanta, GA; New York City, NY; and Lexington, KY. Learn More about BBI

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