Several years ago, Goodwill Industries came under scrutiny after an investigation revealed it was paying disabled workers as little as 22 cents an hour. Despite the multibillion dollar nonprofit paying its executives six-figure salaries, it paid disabled workers pennies for their labor. It may surprise you that Goodwill’s actions are legal.
The reason some nonprofits that hire adults with disabilities can ignore minimum wage laws is because of Section 14(c) of the Fair Labor Standards Act (FLSA). This section of the FLSA allows employers to pay disabled workers less than minimum wage after obtaining a special certificate from the Department of Labor. After becoming certified, employers can pay workers based on their abilities. There is also no bottom to this limit, meaning businesses could pay far below minimum wage
When Are Businesses Stealing Wages from Disabled Workers?
Some businesses lack certificates from the Department of Labor, but still pay workers less than minimum wage. These workers can be eligible to receive back wages from their employers. This recently happened to a San Francisco nonprofit.
In 2014, San Francisco-based Disabled Employees Rehabilitation Inc., was ordered to pay $43,000 in back wages to a group of workers. Disabled workers at the company operated out of a 6,000-square-foot warehouse performing assembly projects at less than minimum wage. Disabled Employees Rehabilitation Inc., did not have the certificate required to pay workers so little.
Critics to Section 14(c) of the FSLA claim it is condescending and discriminatory barrier that keeps disabled workers from earning a living.
The Los Angeles employment law attorneys at the Law Offices of Kesluk, Silverstein & Jacob will hold companies violating minimum wage laws accountable.