The U.S. Department of Labor (DOL) has announced a proposed rule to phase out the distribution of certificates that allow employers to pay certain workers with disabilities less than the federal minimum wage of $7.25 per hour. The rule proposes to gradually eliminate certificates that employers can apply for under Section 14(c) of the Fair Labor Standards Act (FLSA), which allows them to pay subminimum wages to some workers with disabilities. For nearly a century, it has been legal in the U.S. to pay some individuals with disabilities below the minimum wage. Approximately 40,000 American workers fall into this category, with some earning as little as 5 cents an hour.
Key Details Of The Proposal
Phase-Out Timeline: The proposed rule would cease issuing new 14(c) certifications. Existing programs would be phased out over a three-year period following the rule’s effective date.
Legal and Political Hurdles: The proposal faces potential legal challenges and political opposition, requiring careful consideration of public commentary before finalization.
Economic and Workplace Implications: The potential impact on workers with disabilities and employers is a subject of ongoing debate. While some express concerns about reduced employment opportunities, others emphasize the importance of ensuring equitable workplace standards.
Next Steps
The DOL is currently soliciting public feedback on the proposed rule. Employers utilizing 14(c) certificates should closely monitor these developments and prepare for potential adjustments to their wage practices and compliance strategies