WASHINGTON — With President Obama expected to sign an executive order any day now to raise the minimum wage on new federal contracts, advocates for the physically and intellectually disabled are pressing the White House to include the group among those getting raises.
At his State of the Union Address last month, Obama promised to soon issue an executive order that would hike the minimum for workers on new federal contracts to $10.10 per hour from the current federal rate of $7.25.
The executive action by Obama, who is pressing Congress to pass a minimum wage hike that would cover all workers, could potentially affect tens of thousands of low wage earners that do janitorial, dish-washing and other tasks for the federal government through contractors.
But it remains uncertain whether the executive order will address the issue of disabled workers under a government program that dates back to 1938 and allows employers to pay some sub-minimum wages — sometimes for a fraction of the prevailing minimum wage.
Chester Finn, 58, who is visually impaired and spent six years working in sheltered workshop in western New York, said including the disabled in Obama's forthcoming executive order is simply a matter of fairness.
"We have to be included," said Finn, who is now working in Albany as an advocate for the intellectually and developmentally disabled. "It's important to have all Americans to get the same chance and the same opportunity. It's important to recognize that the work people are doing is important."
In a conference call with advocates for raising the minimum the day after Obama's State of the Union speech, administration officials suggested that disabled workers on federal contracts employed under section 14(c) of the Fair Labor Standards Act would likely see no more than a minimal bump in their pay after the executive order is issued, according to Ari Ne'eman, president of the Autistic Self-Advocacy Network, who participated in the call.
But earlier this week, Perez said in an interview on NPR's Diane Rehm Show that 14(c) is "a provision of law which really has worked to the detriment of people with disabilities." He added in the interview that the provision was an issue that the Obama administration officials were examining as it finalizes the executive order.
The Labor Department deferred questions on the executive order to the White House, which did not respond to requests for comment on the matter.
But some advocates for the disabled are trying to keep up the pressure on the administration.
"Mr. President and Secretary Perez, all employees of federal contractors should mean all employees, regardless of disability status," a coalition of disability groups, civil rights groups and unions wrote in a letter to Obama and Perez this week.
Under Section 14 (c), employers can obtain special minimum wage certificates from the Labor Department. The certificates give employers the right to pay disabled workers, many of whom would have difficulty finding work in the mainstream job market, according to their abilities. For example, if an employee produces 50% of what a non-disabled person produces, then he or she receives 50% of what that person is paid.
About 95% of roughly 420,000 workers employed under 14(c), worked in segregated work environments known sheltered workshops, performing basic manual work that often pays by the piece. (Advocacy groups estimate fewer than 50,000 work for government contractors.)
Companies participating in the program also receive preference when it comes to federal contract awards and can receive Medicaid funds to pay for support services for the employees. Some states also provide funding to sheltered workshops
Operators of sheltered workshops say that including 14(c) workers in Obama's minimum wage hike would inevitably lead to many disabled people being pushed out of work.
"It would definitely impact us, in the fact that we just couldn't employ those employees who are at the lower spectrum," said Bob Koch, president of the Missouri Association of Sheltered Workshop Managers. "We could probably keep some that perform close to the level of minimum wage. But somebody who is performing at half the level [of minimum wage] or even less, it would be hard to keep them and stay viable very long."
But advocates point to states that have moved away from the sheltered workshop model, most notably Vermont, that have had success transitioning disabled workers to the mainstream work environment and the prevailing wages.
"The argument that is made is the same argument that is made against raising the minimum wage in general: If you require us to pay disabled people the minimum wage, we won't hire disabled people," said Ne'eman, of the Autistic Self-Advocacy Network. "The fact of the matter is that states that have taken action on sub-minimum wage, that's not really true."