Subminimum wages taken off the chopping block

by Michael Cardman, Brightmine Senior Legal Editor

The US Department of Labor (DOL) is abandoning a Biden-era plan to phase out subminimum wages for workers with disabilities.

The Fair Labor Standards Act (FLSA) authorizes the DOL to issue special certificates – known as “14(c) certificates” – that allow employers to pay workers with disabilities at wages below the federal minimum of $7.25 per hour if their disabilities impair their earning or productive capacity.

Late last year in the waning days of the Biden administration, the DOL proposed to stop issuing new certificates and phase out existing certificates over the next three years. At the time, DOL officials said they believe subminimum wages are no longer necessary because opportunities and training have “dramatically expanded” for workers and because employers now have more resources and training to recruit, hire and retain them.

But now, under the Trump administration, the DOL is withdrawing that proposal. In a notice that will be published in the Federal Register on July 7, the DOL says it lacks statutory authority to “unilaterally and permanently” end subminimum wages for workers with disabilities.