Higher pay for disabled employees could put them out of work

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Published: April 5 2010 | 5:00 am - Updated: 30 March 2014 | 10:21 pm in
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Faith Millburn earns about $1.25 an hour working for Goodwill. She knows that’s less than minimum wage, and she thinks it’s fair.

The 21-year-old with cerebral palsy, who on Thursday was typing labels at Goodwill of the Heartland in Iowa City, is at the center of a complex debate over what to pay people with disabilities for their work.

Part of the fallout from the mistreatment of workers in Atalissa is renewed scrutiny of a federal law that allows employers to pay disabled workers less than federal minimum wage. Even a distant threat to that legislation is troubling to organizations like Goodwill, who say they can’t afford to employ as many workers at higher wages, and to Millburn, who thinks she would have trouble finding a job working for minimum wage.

“I think it’s funny that they want to change it,” she said. “The way it is now is fair.”

Because of the Atalissa case, where mentally disabled workers were paid only $65 a month to work at West Liberty Foods and an Atalissa farm, Sen. Tom Harkin wants to review the law.

Here’s how the law works now: Instead of paying disabled employees minimum wage, organizations like Goodwill and Options of Linn County can get a certificate to allow them to pay disabled workers less than minimum wage. The organization measures how much work the average able-bodied worker can complete in an hour and then times its disabled employee and pays him or her according to productivity. Sometimes employees are paid according to the number of tasks performed, instead of hourly.

“All of that is documented,” said Dana Engelbert, spokeswoman for Goodwill of the Heartland in Iowa City.

In Cedar Rapids and Iowa City, hundreds of disabled people hold jobs like this with Goodwill, Options, Systems Unlimited and REM Developmental Services. Some 81 employers in Iowa are authorized to pay less than minimum wage.

“Phasing it out means that, for our agency alone, right around 500 clients would be without a job,” Engelbert said.

Options of Linn County employs 125 people at its southwest Cedar Rapids facility. Disabled workers sort paperwork, coil rope into buckets and screw bolts into nuts. Options gets contracts from private companies, and the work changes as contracts are completed and new ones come in.

Jim Nagel, director of Options of Linn County, said most of the workers simply wouldn’t be hired in the private sector.

“They would either have to go to some kind of day programming, or they’d have to stay home,” he said.

The Iowa Association for Persons in Supported Employment wants to work toward eliminating subminimum wage, president Lonnie Matthews said.

“The ideal system would be that there’s enough money in the system that everyone could make minimum wage or above,” Matthews said. “It has to be done very, very carefully.”

Harkin understands that groups like Goodwill are able to employ people with disabilities because of the subminimum wage legislation and acknowledges the importance of that ability, spokeswoman Bergen Kenny said. Still, he would like to give people with disabilities more choices.

“He remains concerned that some individuals employed in (such) programs are being paid far below the value of their work, as was so clearly demonstrated in Atalissa, and is looking at ways to ensure that appropriate safeguards are in place,” Kenny said.

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