It is legally permissible for employers to pay certain workers, such as individuals with disabilities or student-learners, less than the minimum wage in the US. This practice, known as the subminimum wage, can result in some workers making less than $3.50 per hour. Recently, the U.S. Department of Labor has begun considering reforms to this system. Marissa Ditkowsky, an attorney for the National Partnership for Women and Families, elaborated on this issue. According to Ditkowsky, the Fair Labor Standards Act contains a provision, referred to as 14 C, that allows employers to pay disabled workers less than the federal minimum wage.

The 14 C clause originated in 1938. Initially, the provision was intended to help individuals with intellectual or developmental disabilities find employment. However, the provision’s relevance and fairness in the current societal landscape are being questioned. The practice is commonly utilized by companies like Goodwill, and has resulted in substantial pay disparities between the company’s highest and lowest earners.

Though living costs apply to everyone, disabled individuals often face unique expenses. The subminimum wage, combined with programs like the Supplemental Security Income, can often trap disabled individuals in a cycle of poverty. Recognizing this, approximately 13 states have begun phasing out the subminimum wage. For example, Vermont abolished this practice in 2002, and Maryland followed suit in 2020. Governments and federal agencies are also considering taking measures to abolish the subminimum wage. Despite warnings from businesses that abolishing this wage could have unintended negative consequences, those advocating for change believe that the benefits outweigh the potential downsides.