The U.S. Department of Labor has introduced a proposed rule aimed at phasing out certificates that permit employers to pay workers with disabilities less than the federal minimum wage, which is currently $7.25 per hour. This initiative seeks to gradually eliminate the use of these certificates under Section 14(c) of the Fair Labor Standards Act.
The proposal outlines a plan to stop issuing new certificates and establish a three-year transition period for employers who currently hold such certificates, allowing them time to adjust before they must comply with paying full wages.
“This proposal demonstrates the Biden-Harris administration’s dedication to good jobs for workers with disabilities,” stated Acting Secretary of Labor Julie Su. She emphasized that legal and policy advancements have significantly expanded employment opportunities for individuals with disabilities since Section 14(c) was first included in the Fair Labor Standards Act. Su added, “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 wellbeing and strengthen inclusion for people with disabilities in the workforce.”
Key aspects of the proposed rule include halting new certificate issuance on its effective date and instituting a three-year period for current certificate holders to cease paying subminimum wages.
Wage and Hour Administrator Jessica Looman remarked, “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.” She noted that since 1938, opportunities for people with disabilities have increased significantly, enabling them to secure employment at or above minimum wage levels.
Assistant Secretary of Labor for Disability Employment Policy Taryn Williams commented on the administration's commitment: “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.”
The Department of Labor conducted an extensive review process beginning September 26, 2023. This involved stakeholder engagement sessions gathering input from various groups including disability rights advocates and Section 14(c) certificate holders. The feedback informed the development of this proposed rule.
Interested parties are encouraged to submit comments on this proposal once it appears in the Federal Register. Comments must be submitted by January 17, 2025, at 11:59 p.m. EST to be considered in this rulemaking process.
