Law Still Allows Many to Earn Well Below Minimum Wage

In the most recent indication that the perception and treatment of people with disabilities is changing for the better,Goodwill Industries last month ended its program that allowed people with disabilities to be paid less than minimum wage.


The company, founded 70 years ago, was created to provide jobs for people with disabilities at a time when they could not find work. The company has continued paying some of its workers a disturbingly low 22 cents an hour while other employees made six figures.

Some laws have still not changed, but the company realized it was time to move in the right direction.

“There’s a lot of pressure from disability rights organizations locally and nationally to change the law,” said Kym King, a spokeswoman for Goodwill of Houston. “Part of our decision was that this was coming, and we wanted to be proactive about that.”

Goodwill Industries was not alone in this practice. For the past 70 years, many large companies within the United States have instituted programs known as “sheltered workshops” for employees with disabilities. In 1938, a federal law was passed that allowed employers to pay employees with disabilities less than minimum wage.

Disability rights advocates have pushed for an update to the law. Democratic presidential nominee Hillary Clinton has come out against the “sheltered workshop” practice completely, bringing the issue to the public eye for this election.

Related Story: The DiversityInc Top 9 Companies for People with Disabilities

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

The concept behind allowing this was that earning a small paycheck was better than earning no pay check at all for people with disabilities. This law, which is part of the Fair Labor Standards Act, was created to encourage employers to hire employees with disabilities without having to worry about the financial implication of hiring an employee that may not be as efficient as able-bodied workers due to their disability.

However, those who have long been outspoken against this practice see the work conditions as limiting and unjust, also noting how people within these programs are being egregiously underpaid, are not being trained or developed for any worthwhile job skills and are being denied their right to a competitive opportunity by being segregated from the entire workforce.

And this segregation continues. According to the Bureau of Labor Statistics, 11.7 percent of people with disabilities ages 16-64 are unemployed compared to just 5.1 percent of the general population without a disability.

People with Disabilities: The Untapped Talent Pool

Some employers are beginning to see the benefits to employing people with disabilities. PricewaterhouseCoopers, No. 5 on the 2016 DiversityInc Top 50 Companies for Diversity list, held an event, “The Inclusion Project: Ability Reveals Itself,” which brought thought leaders in diversity and inclusion together to provide tips and best practices when it comes to tapping into this talent pool.

One important tip is to recognize the skills potential that employees with disabilities possess. Brad Hopton is a PwC tax partner who is largely involved in the company’s disability Employee Resource Groups (ERGs). Hopton also serves on the National Organization on Disability (NOD)’s Board of Directors (along with DiversityInc Founder and CEO Luke Visconti, who serves as vice chair).

Hopton described employees with disabilities as “creative problem solvers.”

“Our mission statement is, all around, solving important complex problems for our clients and society,” Hopton noted. When the message was presented in this way, leaders at the firm “quickly got on board.”

For the other tips and best practices from Hopton and others, be sure to subscribe to DiversityInc Best Practices.

For more information on how to recruit, retain and promote employees with disabilities, don’t miss DiversityInc Best Practices’ Webinar, Retention and Advancement of Employees with Disabilities, on October 4, which will feature Hopton as a presenter. Click here to register.

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