Biden Administration Moves to End Subminimum Wages for Workers with Disabilities

United States Department of Labor

WASHINGTON, D.C. — A landmark step toward workplace equity has been introduced by the Biden Administration, with officials unveiling a proposed rule to phase out the payment of subminimum wages to individuals with disabilities. The initiative, championed by U.S. Senator Bob Casey (D-PA), is designed to eliminate an outdated practice that has marginalized disabled workers for decades.

Currently, under Section 14(c) of the Fair Labor Standards Act (FLSA), employers can apply for special certificates that permit them to pay workers with disabilities below the federal minimum wage of $7.25 per hour. Many of these workers, often those with intellectual or developmental disabilities, earn less than $3.50 an hour. The new rule aims to end this form of compensation, ushering in a period of fairer treatment and increased economic opportunities for employees with disabilities.

“Every worker deserves to be paid a fair wage, and Americans with disabilities are no exception,” stated Senator Bob Casey, who has long been an advocate for economic inclusion. “For years, I have pushed to end this shameful, discriminatory practice. This proposed rule is a step toward ensuring workers with disabilities are finally treated fairly and can achieve financial independence.”

Under the proposed rule, the U.S. Department of Labor would stop issuing new Section 14(c) certificates immediately following the rule’s implementation. Employers currently holding such certificates would have a three-year period to transition to paying at least the federal minimum wage to any workers impacted.

Acting Secretary of Labor Julie Su highlighted the significant progress made in workplace inclusion for people with disabilities, noting that “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 wellbeing and strengthen inclusion for people with disabilities in the workforce.”

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The proposed changes reflect the administration’s broader commitment to fostering an inclusive labor market. Wage and Hour Administrator Jessica Looman underscored the fundamental value of fairness in the workplace, stating, “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. Since 1938, opportunities and training have dramatically increased, helping individuals with disabilities gain employment at or above the full federal minimum wage.”

Assistant Secretary of Labor for Disability Employment Policy Taryn Williams also emphasized the importance of this initiative in shaping a modern, inclusive workforce. “The Biden-Harris administration is committed to creating a more inclusive workforce, where individuals with disabilities can thrive without being held back,” she remarked. “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.”

If enacted, the rule is expected to impact thousands of workers nationally, offering them not only fair pay but increased opportunities for economic stability and personal growth. The Department of Labor asserts that today’s employers have access to more tools, training, and resources than ever to support workers with disabilities, making this transition both necessary and achievable.

The introduction of this rule signals a critical move toward economic justice for all and reflects a growing recognition of the value and potential of individuals with disabilities in the labor market. The three-year phase-out period aims to provide businesses with adequate time to adjust their practices while ensuring a smooth and fair transition for affected workers.

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This proposed rule by the Biden Administration represents a significant shift in employment policy, with the potential to redefine how society values the contributions of workers with disabilities well into the future.

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