The minimum wage affects many people in the United States, but it has a more profound effect on those with disabilities. For example, individuals with disabilities are less likely to find work than their non-disabled counterparts. This article will explore how the federal minimum wage impacts people with disabilities, more specifically, the effects of the Raise the Wage Act on employers and employees alike.
The federal minimum wage has remained stuck at $7.25 an hour since 2009, even though living costs have continued to rise over this period. This is now the longest stretch without a minimum wage increase in US history — since 1938. The lowest-paid workers are those who earn tips on top of their hourly pay. These individuals only receive a base pay of $2.13/hour (restaurant servers, for example). Many people with disabilities also work for subminimum wages.
The Raise the Wage Act would gradually increase the federal minimum wage to $15 per hour by 2025. After this point, it will automatically adjust at a consistent rate relative to median wages to ensure long-term upward trends and avoid future battles over increases. This bill also eliminates subminimum wages for disabled and tipped employees. As a result, nearly 40 million Americans would see an increase in their paychecks when these changes go into effect.
The Raise the Wage Act would phase out section 14(c) of the Fair Labor Standards Act, allowing employers to pay a person with a disability less than minimum wage. Proponents of the Bill say this section runs counter with the United States’ promise of equality and fairness under current legislation.
In some horror stories, people with disabilities have earned just pennies every hour. Employing individuals under the 14(c) certificate communicates to Americans with disabilities and their families that they are less valuable than other Americans. It also implies society values their labor less.
When the FLSA was enacted in 1938, it assumed that disabled workers were less productive than non-disabled workers. However, this assumption had no factual basis and is not true at all. Nearly a century later, the law retains Section 14. (c). But advocates say we now know that when disabled workers are provided with equal opportunity and appropriate tools or technologies, they can perform on par with their non-disabled counterparts.
Opposition to Raise the Wage Act
The people skeptical of eliminating subminimum wages for disabled people, including some agencies that operate sheltered work sites, fear that requiring employers to pay competitive wages would increase unemployment among the workers who have disabilities.
For example, day habilitation programs help people with disabilities get out and about in the community. They participate in social activities, gain life skills, and do what they can to integrate into society as well as possible.
New legislation such as the Raise The Wage Act will harm job opportunities for those in day habilitation programs or even for our clients here at Amplify. This is because these programs rely on government funds to operate effectively, and paying minimum wages would severely limit how much money can be spent per person. Unfortunately, this would result in cutbacks (such as restricting program capacity) or closures of many day habilitation facilities across America. They would most likely need to cut back on staff too.
But additional opposition is also coming from parents of disabled workers. At the National Disability Rights Network, Cheryl Bates-Harris says family members are worried about the proposed legislation. Specifically, they worry about their sons and daughters being protected and sheltered. They’re scared of what’s going to happen to them. The transition between sheltered to unsheltered worksites can be too drastic for those with disabilities.
The Raise the Wage Act is a federal bill that proposes raising the minimum wage in increments over time and indexing it to inflation. This act has been met with opposition from non-profit organizations concerned about keeping up with increasing labor costs and support from people living below the poverty level.
If you or someone you know lives on disability benefits, this legislation could positively affect the quality of life by giving more disposable income each month. Or, it can be harmful as non-profits may need to scale back operations in order to keep afloat, limiting job opportunities to those who need them.
We’ve outlined some pros and cons for those considering raising wages for employees in your organization – we hope these thoughts help inform curiosity! If you’re interested in supporting us here at Amplify as a partner or client and creating opportunities for adults with disabilities, please contact us today!