Phase Out of Subminimum Wages for Workers on AbilityOne Contracts
On March 20, SourceAmerica (formerly National Industries for the Severely Handicapped) announced that it had notified its affiliated nonprofit AbilityOne agencies (NPAs) of its plan to eliminate the use of Special Minimum Wage Section 14(c) certificates on AbilityOne contracts. Click this link to view a copy of the SourceAmerica letter.
The U.S. Department of Labor’s Wage and Hour Division (WHD) published three documents providing guidance on the payment of subminimum wages under section 14(c) of the Fair Labor Standards Act (FLSA).
The first two are related to the impact of Rehabilitation Act section 511 and third provides general guidance on the administration of section 14(c). You can see the documents by clicking on their title below:
The first document is Field Assistance Bulletin (FAB) No. 2019-1 concerning the definition of subminimum wages under section 511 and WHD’s enforcement of the limitations on the payment of those wages under section 14(c).
The second is a revised Fact Sheet #39H: The Workforce Innovation and Opportunity Act and Limitations on Payment of Subminimum Wages under Section 14(c) of the Fair Labor Standards Act. The revisions include information on the definition of subminimum wages and timing requirements under section 511, as well as two charts to provide visual summaries for determining when and to whom the specific section 511 requirements apply. The Fact Sheet also cross-references readers to the related regulations issued by the U.S. Department of Education.
The third guidance document, Fact Sheet #39I: Adjusting Commensurate Wage Rates under a Section 14(c) Certificate After a Change in the Minimum Wage, provides guidance on taking appropriate action to ensure prevailing wage rates are timely examined and adjusted, and the workers’ commensurate wage rates correspondingly adjusted, as needed, when there is an increase in the federal, state, or a locality’s minimum wage requirements.
Phase One of the national study of the change in 14c employers and subminimum wage workers is now complete!
Current WINTAC researcher Jenean Jacobs and former WINTAC researcher Sarah Hancock have completed a study that spans from January, 2016 through July, 2018 on the change in the number of 14c certificate holders and the change in the number of individuals with disabilities working in subminimum wage employment. This information is based on data from the Wage and Hour Division of the Department of Labor.
Click here to see a summary of the change by State (This should result in a download of the spreadsheet on the summary of changes)
Click here to see the specific State by State according to the tabs at the bottom of the spreadsheet (This should result in a download of the larger “all states” spreadsheet)
Stay tuned for Phase Two of the project which will examine what happened to the 14c holders that let their certificates expire without renewing.
Note: In some instances, the data from DOL shows a 14c holder as active but no data is listed during the most recent report. This is the reason for the extra column in the summary sheet and the additional calculation in each of the spreadsheet tabs.
This section of the website includes resources that we hope you will find useful related to Section 511, subminimum wage employment, and related topics. We will be adding to this section regularly, so please check back often.
NCD: From the New Deal to the Real Deal: Joining the Industries of the Future
The National Council on Disability - an independent federal agency - released its latest report on trends regarding American workers with disabilities being paid below minimum wage, recent policy changes impacting this employment model, and characteristics of for-profit entity use of subminimum wage work in their supply chains. Click here to read "From the New Deal to the Real Deal: Joining the Industries of the Future".
Career Counseling and Information and Referral (CC&I&R) Examples
Hawaii's Section 511 Documents
- CC&I&R Presentation
- Hawaii Information and referral form
- Hawaii self-advocacy, self-determination and peer mentoring form
- Hawaii subminimum wage letter to employee and parent/guardian
Many VR agencies have asked for examples of CC&I&R presentation materials. We have three examples to share from Idaho, Hawaii and Arizona. You can view each of these presentations by clicking on the name of the VR program below. Each of these presentations is being conducted at the work site. The 14(c) employer is allowing the VR program or contracted staff to come in to the work site and present to an established number of individuals. The required documentation is completed on-site when the presentation is over.
RSA reviewed the CC&I&R forms developed by Indiana and has recommended them for adaption and use by other VR programs. You can access these forms by clicking on the links below:
RSA Presentation on Section 511
At the Fall, 2016 CSAVR conference in San Diego, RSA presented on several parts of the Workforce Innovation and Opportunity Act. If you are interested in reviewing the RSA presentation on Section 511, click to view the RSA Presentation on Section 511 at 2016 CSAVR Conference in PDF format.
- Although the Final Rule for Section 511 does not specify what the content of Career Counseling and Information and Referral (CC&I&R) should include, we have identified the common elements of career counseling as well as the common State, Federal and other programs that may provide opportunities for competitive integrated employment for individuals with disabilities. Click to view the common elements of career counseling and agencies to include when providing information and referral services.
- Are you curious about how many individuals with disabilities in your state are working in subminimum wage employment and who is employing them? You can visit the Department of Labor website by clicking here to find out this information.
- Secretary Clinton Calls for Ending Subminimum Wages for People with Disabilities
- The Department of Labor sent a letter to all 14c certificate holders explaining their responsibilities under WIOA. You can read the letter by clicking here.
- The Department of Labor’s Employment and Training Administration has posted several informational items and guidance for subminimum wage employers. If you are interested in reading this guidance, you can click on the link for Subminimum Wage Employment for Workers with Disabilities.
Help Developing Procedures and Documentation Requirements to Respond to Section 511
If you are in the process of developing procedures and documentation requirements to respond to the requirements for Section 511 and you would like help with this process, you might find the attached document helpful:
Senators call for an end to subminimum wage employment
The fight against the payment of sub-minimum wage to people with disabilities is mounting. Senator Warren and six of her colleagues have sent a letter to DOL on this issue. Click this link to read the letter.
If you are looking for a self-advocacy training program, Milt Wright and Associates has developed a program that might interest you:
Without Limits, a Self-Advocacy Program for High School and Post-Secondary Students in Transition 2018
Without Limits is an interactive curriculum designed for trainers and teachers to help high school and post-secondary students in transition discover their own value while learning ways to self-advocate.
The curriculum is designed for four different intellectual levels of students in transition, kindergarten, elementary, middle school, and high school/post-secondary. With ten exercises for students and two exercises for parents and guardians, Without Limits provides an opportunity to empower youth confidence in educational and employment pursuits.
Please click on Miltwright.com
Access more information on this innovative curriculum and a free copy of the Without Limits first activity. This activity has all the instructions for the trainer along with all the handouts for the students in transition.