I 

113TH CONGRESS 

1ST SESSION H. R. 831 

To phase out special wage certificates under the Fair Labor Standards Act 

of 1938 under which individuals with disabilities may be employed at 

subminimum wage rates. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 26, 2013 

Mr. HARPER (for himself, Mr. ALEXANDER, Mr. BISHOP of Georgia, Mr. CONYERS, Mr. ELLISON, Mr. HASTINGS of Florida, Ms. MOORE, Ms. NORTON, Mr. RUSH, Mr. TONKO, Mr. YOUNG of Alaska, and Mr. CLYBURN) 

introduced the following bill; which was referred to the Committee on 

Education and the Workforce 

A BILL 

To phase out special wage certificates under the Fair Labor 

Standards Act of 1938 under which individuals with 

disabilities may be employed at subminimum wage rates. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Fair Wages for Work5 ers with Disabilities Act of 2013’’. 

6 SEC. 2. FINDINGS. 

7 Congress finds the following: 


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1 (1) Current Federal law allows the Secretary of 

2 Labor to grant special wage certificates to entities 

3 that provide employment to workers with disabilities, 

4 allowing such entities to pay their disabled workers 

5 at rates that are lower than the Federal minimum 

6 wage. 

7 (2) The practice of paying workers with disabil8 ities less than the Federal minimum wage dates 

9 back to the 1930s, when there were virtually no em10 ployment opportunities for disabled workers in the 

11 mainstream workforce. 

12 (3) Today, advancements in vocational rehabili13 tation, technology, and training provide disabled 

14 workers with greater opportunities than in the past, 

15 and the number of such workers in the national 

16 workforce has dramatically increased. 

17 (4) Employees with disabilities, when provided 

18 the proper rehabilitation services, training, and 

19 tools, can be as productive as nondisabled employees. 

20 Even those individuals that are considered most se21 verely disabled have been able to successfully obtain 

22 employment earning minimum wage or higher. 

23 (5) While some employers possessing special 

24 wage certificates claim to provide rehabilitation and 

25 training to disabled workers to prepare them for 


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1 competitive employment, the fact that such employ2 ers can pay their workers less than the Federal min3 imum wage gives them an incentive to exploit the 

4 cheap labor provided by their disabled workers rath5 er than to prepare those workers for integrated em6 ployment in the mainstream economy. 

7 (6) Many employers with a history of paying 

8 subminimum wages benefit from philanthropic dona9 tions and preferred status when bidding on Federal 

10 contracts. Yet they claim that paying minimum wage 

11 to their employees with disabilities would result in 

12 lack of profitability and forced reduction of their 

13 workforces. 

14 (7) Other employers, recognizing that the pay15 ment of subminimum wages is in fact exploitation of 

16 disabled workers, are now paying the Federal min17 imum wage, or higher, to their employees with dis18 abilities without reducing their workforces, while still 

19 maintaining their profitability. For example, Na20 tional Industries for the Blind (NIB) agencies ex21 ploited their blind employees for years through the 

22 payment of subminimum wages, claiming they could 

23 not maintain profitability otherwise. Now, ‘‘All NIB 

24 associated agencies are committed to the NIB Board 

25 policy to pay employees, whose only disability is 


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1 blindness, at or above the Federal minimum wage or 

2 their state minimum wage, whichever is highest.’’ 

3 (8) The Wage and Hour Division of the De4 partment of Labor is charged with the responsibility 

5 for oversight of these special wage certificates. The 

6 results from thorough investigations conducted by 

7 the Government Accountability Office—‘‘Stronger 

8 Federal Efforts Needed for Providing Employment 

9 Opportunities and Enforcing Labor Standards in 

10 Sheltered Workshops, Report to the Congress, 

11 Comptroller General of the United States’’ (HRD– 

12 81–99) and ‘‘Report to Congressional Requesters, 

13 Special Wage Program: Centers Offer Employment 

14 and Support Services to Workers With Disabilities, 

15 But Labor Should Improve Oversight’’ (GAO–01– 

16 886)—explain that due to lack of capacity, training, 

17 and resources, the Wage and Hour Division is in18 capable of enforcing compliance with the submin19 imum wage provision. Furthermore, the significant 

20 appropriation that would be required to improve 

21 oversight of the regulation would be better spent im22 proving employment outcomes for people with dis23 abilities. 

24 (9) According to the rules established under 

25 section 14(c) of the Fair Labor Standards Act of 


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1 1938, employers are to determine the special wage 

2 to be paid to a disabled employee through a com3 plicated method that unfairly establishes a produc4 tivity benchmark that would be difficult for anyone 

5 to maintain. The inability of many employers to cor6 rectly establish the wage pursuant to the rule has 

7 regularly resulted in disabled employees receiving 

8 even less than the special minimum wage (below the 

9 federally established minimum wage) that they 

10 should have received under the regulation. 

11 SEC. 3. TRANSITION TO FAIR WAGES. 

12 (1) DISCONTINUANCE.—Effective on the date of 

13 enactment of this Act, the Secretary of Labor shall 

14 discontinue issuing special wage certificates under 

15 section 14(c) of the Fair Labor Standards Act of 

16 1938 (29 U.S.C. 214(c)) to any new entities not 

17 currently holding a certificate. 

18 (2) TRANSITION.—All special wage certificates 

19 held on the date of enactment of this Act— 

20 (A) by private for profit entities shall be 

21 revoked 1 year after such date of enactment; 

22 (B) by public or governmental entities 

23 shall be revoked 2 years after such date of en24 actment; and 


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1 (C) by non-profit entities shall be revoked 

2 3 years after such date of enactment. 

3 (3) REPEAL.—Effective 3 years from the date 

4 of enactment of this Act, section 14(c) of the Fair 

5 Labor Standards Act of 1938 (29 U.S.C. 214(c)) is 

6 repealed and any remaining special wage certificates 

7 issued under such section shall be revoked. 

Æ 


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