Proposed rule would eliminate subminimum wage for employees with disabilities

Why the DOL issued the proposed rule

Since its enactment in 1938, the FLSA has included a provision authorizing the DOL to issue certificates allowing employers to pay workers with disabilities at wage rates below the federal minimum wage. The certificates could only be issued to the extent necessary to prevent curtailment of employment opportunities.

With the rule, the DOL would stop issuing new permits for this practice. Employers that currently hold certificates under this practice, however, could continue to pay subminimum wages for up to three years after the final rule’s effective date.

The DOL pointed out in the proposed rule how much has changed with employment in the past 86 years, including expanded work opportunities and rights for individuals with disabilities. Subminimum wages are no longer needed.

Potential benefits of the rule

The DOL believes that if this rule is finalized, it will result in higher wages for these workers and improve their financial independence. It could also increase the number of people with disabilities in the workforce. The rule won't force workers to leave their jobs or employers to change their services.

The DOL expects that many workers currently paid under these permits will be able to transition to full-wage employment, which will benefit them.

Anyone who would like to comment on the proposed rule may do so before January 17, 2025, at www.regulations.gov.

Key to remember: A proposed rule would stop employers from paying employees with disabilities less than the federal minimum wage.