Bill would phase out sub-minimum wages for disabled workers over four years

What does this do?

HR 4771 would end Section 14(c) of the Fair Labor Standards Act, which currently allows approved employers to pay workers with disabilities less than minimum wage based on productivity comparisons. No new employers could receive sub-minimum wage approval immediately upon enactment, and existing approved employers would have four years to raise wages to full minimum wage. After that four-year period, the sub-minimum wage program would be completely eliminated.

Who does it affect?

The bill directly affects people with disabilities working in sheltered workshops or similar programs, as well as the organizations and employers that run those programs. State governments, vocational rehabilitation agencies, Medicaid programs, and families of people with disabilities would also be involved in carrying out the transition.

Why does it matter?

Eliminating the sub-minimum wage provision would require sheltered workshops and similar employers to fundamentally change or end their current business models. States would need to update their disability services and employment plans, and multiple agencies and programs would take on new responsibilities during the transition period.

What does it cost, and who pays?

• States: up to $10M over 5 years
• Employers: up to $500K over 3 years
• Nonprofit funded for technical help