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Tuesday, September 3, 2024

The Subminimum Wage Is Problematic

In The Politics of Autism, I discuss the employment of people on the autism spectrum

The subminimum wage is a good example of policy failure. Amanda Morris, Caitlin Gilbert and Jacqueline Alemany at WP:

  • Federal rules state that 14(c) employers must help disabled workers move on to higher-paying jobs, but many never leave the program. In 2022, just 0.5 percent of 14(c) workers were referred by their employers to vocational rehabilitation services, the main pathway for them to leave the program, according to data from the Rehabilitation Services Administration for 35 state agencies.
  • When states have ended 14(c) subminimum wage programs, overall employment of adults with cognitive disabilities has increased. A Post analysis of eight states that ended their programs before 2022 showed that employment rates for adults with cognitive disabilities increased by at least 14 percent after state programs were canceled, when adjusted for overall employment rate growth.
  • About one in three current 14(c) employers have failed to correctly pay wages, but that is probably an undercount because few are investigated each year. Between October 2009 and September 2023, the Labor Department ordered employers to pay $20.2 million in back wages for pay and other violations.
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Oversight of different aspects of the 14(c) program is fragmented between four federal agencies — the departments of Labor, Education, Justice, and Health and Human Services. However, no federal agency is in charge of making sure individuals move from 14(c) programs into community employment. A stream of government reports over three decades have called for additional oversight of the program or ending it entirely. In a 2020 report, the U.S. Commission on Civil Rights wrote that the 14(c) system was “rife with abuse,” with respect to wages, and found that workers were not getting the support they needed to move on into community jobs.

A 2023 report from the Government Accountability Office surveyed wage data from 2019 to 2021 and found that workers were typically making about $3.50 per hour, compared with a federal minimum wage of $7.25. About 12 percent made hourly wages of less than a dollar

Only about 2 percent of workers fully transitioned out of 14(c) jobs into a competitive, integrated job, according to August 2021 data from the same agency.