NCD Applauds Precedent-Setting Decision That Disabled Workers Must Be Paid Fair Wages

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February 4, 2016

The National Council on Disability—an independent federal agency—applauds the precedent-setting opinion issued by the U.S. Department of Labor (DOL) administrative judge, in which three employees of a sheltered workshop in Ohio that pays below minimum wages to workers with disabilities, were  awarded minimum wages going forward as well as back pay. The petitioners had been paid an average of $2.50 an hour during their employment the workshop over the last three years.

NCD commends Disability Rights Ohio, the National Federation of the Blind, the Autistic Self Advocacy Network, and the Baltimore law firm of Brown, Goldstein & Levy, LLP for filing the petition seeking fair wages for Joe Magers, Pam Steward, and Mark Felton who are among the first workers with disabilities ever to invoke the petition process seeking a review of their wages by the DOL.

In the decision, DOL’s administrative law judge found that Seneca Re-Ad, a sheltered workshop, failed to prove that the petitioners' disabilities kept them from accomplishing their assigned tasks. As such, the judge decided that their wages were not calculated correctly and that Seneca Re-Ad must pay at least minimum wage.

The outcome of this case supports changes proposed by NCD in its 2012 landmark report, “Subminimum Wage and Supported Employment,” which called for a systems change approach to the outmoded employment policies of the 1930s that presumed people with disabilities were incapable of gainful employment at a competitive wage – a flawed presumption that has come under increasing and appropriate scrutiny in recent years. Section 14(c) of the Fair Labor Standards Act allows employers certified by the DOL to compensate workers with disabilities at a rate below minimum wage.

“The Seneca Re-Ad decision continues an encouraging trend toward equal justice and fair wages for workers with disabilities,” said Clyde Terry, NCD Chair. “Antiquated employment policies dating back eight decades are not only out of touch in today’s modern marketplace but also contrary to the goals of the Americans with Disabilities Act of 1990 (ADA), and the Supreme Court’s Olmstead decision in 1999. Integrated, supported, and competitive employment is rapidly becoming the new normal for disabled workers. NCD applauds this decision and welcomes the progress it represents.”

Following the publication of NCD’s report in 2012—which called for a gradual phase out of the subminimum wage provision for disabled employees—states have begun to make changes in their approaches to the employment of people with disabilities. Most notably, under the threat of a federal lawsuit, Oregon began to downsize its sheltered-work program in 2013, and following an investigation that revealed numerous ADA violations, the U.S. Justice Department announced the nation’s first statewide settlement agreement with Rhode Island in 2014 that promised to provide disabled workers with necessary state-funded services for them to transition to competitive, integrated employment in the community.

As a result of these changes and today’s great news out of Ohio, NCD reaffirms the policy recommendations of its 2012 report, highlighting the following:

  • The Department of Labor should undertake rulemaking to require all participants of 14(c) certificate programs to provide twice annually to all workers the opportunities to transition from a 14(c) setting to a supported employment situation in an integrated worksite with competitive wages. Such notice should also include information about benefit work incentive counseling and peer support.
  • The Department of Justice should exercise its monitoring and enforcement authority to assure that all people with disabilities are transferred to an integrated employment setting and that such person receive a competitive wage.

About the National Council on Disability (NCD): First established as an advisory Council within the Department of Education in 1978, NCD became an independent federal agency in 1984. In 1986, NCD recommended enactment of an Americans with Disabilities Act (ADA), and drafted the first version of the bill which was introduced in the House and Senate in 1988. Since enactment of the ADA in 1990, NCD has continued to play a leading role in crafting disability policy, and advising the President, Congress and other federal agencies on disability policies, programs, and practices.