Hillary Clinton Takes A Stand Against 'Subminimum Wage' For People With Disabilities

Some disabled workers are being paid pennies per hour under a 78-year-old loophole in federal wage law.
Hillary Clinton backed ending the subminimum wage for workers with disabilities.
Hillary Clinton backed ending the subminimum wage for workers with disabilities.
Scott Olson/Getty Images

Democratic presidential candidate Hillary Clinton expressed support for eliminating the “subminimum wage” for people with disabilities employed in specialized workplaces, a major coup for disability rights advocates who argue that the little-known loophole is discriminatory and harmful.

The subject came up Monday in a question-and-answer session at a campaign event at the University of Wisconsin -- Madison. An attorney in the audience, who described herself as being on the autistic spectrum, asked Clinton about the lower minimum wage for workers with disabilities at employers like Goodwill Industries and how she would “create jobs for the disabled population.”

“When it comes to jobs, we've got to figure out how we get the minimum wage up and include people with disabilities in the minimum wage,” Clinton responded. “There should not be a tiered wage."

That extends beyond people with disabilities, Clinton said, and includes the minimum wage exemption for tipped workers, typically in the food service industry. The federal minimum wage for tipped workers is $2.13 an hour. While employers are required to top it off if tips do not bring hourly pay to $7.25, that has proven difficult to enforce.

"So I want us to take a hard look at raising the minimum wage and ending the tiered minimum wages, whether it's for people with disabilities or the tipped wage," Clinton said. "You’ve got millions of people that are totally dependent on tips that may or may not make up a minimum wage, let alone beyond."

Clinton supports raising the federal minimum wage to $12 an hour. Her campaign didn't respond to a question asking whether she would extend that minimum to workers with disabilities and to those whose pay includes tips.

While Clinton’s endorsement of ending the tipped minimum wage is notable, her support for lifting the exemption that applies to workers with disabilities made greater waves because it addresses a priority of disability rights advocates rarely discussed on the national stage.

Ari Ne’eman, a co-founder of the Autistic Self Advocacy Network, one of 81 disability rights groups opposed to the practice of paying workers who have disabilities a lower minimum wage, applauded Clinton’s remarks as “game-changing.”

“To see a major presidential candidate take a stance on this is a very significant step,” Ne’eman said. “We call on other candidates in the race to match Secretary Clinton’s commitment.”

“When it comes to jobs, we've got to figure out how we get the minimum wage up and include people with disabilities in the minimum wage.”

- Hillary Clinton

Mark Riccobono, president of the National Federation of the Blind, thanked Clinton in a statement "for stating boldly and unequivocally that she rejects the discriminatory practice of paying workers with disabilities subminimum wages."

Clinton would do away with the practice of paying a subminimum wage for workers with disabilities, which dates to the 1938 law that created the first federal minimum wage.

The provision allows employers recognized by the federal government for hiring workers “whose earning or productive capacity is impaired” by a mental, physical or developmental disability to pay workers based on individual productivity, according to the Department of Labor, even if it is less than the federal minimum wage of $7.25 an hour. There is no legally mandated wage floor for people with disabilities employed in such circumstances; it is at the eligible employer’s discretion.

The law was intended to encourage employers to hire people with disabilities, since they might otherwise lack the incentive to do so. People with disabilities, the thinking went, might then develop skills that would allow them to move into jobs where the regular minimum wage applied.

Today, however, the subminimum wage allowance is more likely to lead to exploitation and isolation for people with disabilities than to independence and dignity, advocates say.

“It is a relic -- it reflects a 1930s set of assumptions about people with disabilities,” Ne’eman said.

“To see a major presidential candidate take a stance on this is a very significant step.”

- Ari Ne'eman, Autistic Self-Advocacy Network

There were 228,600 workers with disabilities earning a subminimum wage in fiscal 2013, according to the Department of Labor.

The vast majority of those workers with disabilities toil in what are known as “sheltered workshops”: mainly nonprofit institutions that have built their business model on meeting federal guidelines for the subminimum wage -- and that employ those workers exclusively.

These employers typically become certified as job-training service providers for people with disabilities as well, enabling them to pick up added revenue through Medicaid reimbursements.

But that revenue rarely gets passed onto the disabled workers in sheltered workshops.

In fact, the workers sometimes earn wages that would embarrass even some sweatshop owners in the developing world. A June 2013 investigation by NBC News found that Goodwill Industries, one of the country’s largest sheltered workshops, paid workers in some states as little as 22 cents an hour as its executives reaped six-figure salaries.

Rose Sloan, a government affairs specialist for the National Federation for the Blind, said she has seen certification forms from the Department of Labor showing that some employers pay these workers "pennies" per hour.

According to a 2001 Government Accountability Office study, just 5 percent of workers employed in sheltered workshops went on to find jobs in the mainstream economy.

Ne’eman attributed the poor results to the isolation of workplaces that wall off workers with disabilities, and to employers that invest minimal resources in training. Ne’eman maintained that people with disabilities would be as productive as anybody else if given the same job training, work environment, and access to effective support services.

The Department of Justice is encouraging states to adopt this egalitarian, integrated workplace model by cracking down on sheltered workshops that do not meet training requirements.

And it may be catching on. Maryland passed a bill earlier this month abolishing the subminimum wage for people with disabilities.

“Performance can be equal, given the proper training and proper support services, and what we have seen is that states that have moved away from subminimum wage and sheltered workshops” have had success, Ne’eman said.

Hillary Clinton

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