The Biden administration has proposed abolishing the sub-minimum wage for people with disabilities, a move long-awaited by the disability community.
The proposed change could drastically increase pay rates for around 38,000 workers with disabilities across the nation, emphasizing the principle of fair pay for a hard day’s work.
The big picture: The process to eliminate lower pay rates may take months or years, with the possibility of the upcoming Trump administration abandoning the proposal.
- The Biden administration suggests phasing out exceptions to the federal minimum wage over three years, set at $7.25 per hour.
Driving the news: Approximately 700 employers with certificates were found to pay about 38,000 workers below the minimum wage, mostly in “sheltered workshops” for individuals with disabilities operated by nonprofits.
- While some argue that special minimum wages provide employment opportunities and transitions for individuals with disabilities, the proposed change is not without critique.
- Various States and localities have already prohibited or limited the payment of subminimum wages to workers with disabilities within their areas, following the 1990 Americans with Disabilities Act.
- A Congressional Budget Office review in 2023 highlighted that increasing the subminimum wage could boost earnings for some workers but also lead to higher rates of joblessness for others.
- Despite some concerns, the Labor Department reported in 2023 that people with disabilities were employed at the highest rate ever of 22.5%.
