[Nfbnet-members-list] NBC Rock Center: Some dis abled workers paid just pennies an hour – and it's legal

Lewis, Anil ALewis at nfb.org
Fri Jun 21 16:00:02 UTC 2013

Some disabled workers paid just pennies an hour – and it's legal
By Anna Schecter, Producer, NBC News
One of the nation's best-known charities is 
paying disabled workers as little as 22 cents an 
hour, thanks to a 75-year-old legal loophole that 
critics say needs to be closed.

Goodwill Industries, a multibillion-dollar 
company whose executives make six-figure 
salaries, is among the nonprofit groups permitted 
to pay thousands of disabled workers far less 
than minimum wage because of a federal law known 
as Section 14 (c). Labor Department records show 
that some Goodwill workers in Pennsylvania earned 
wages as low as 22, 38 and 41 cents per hour in 2011.

"If they really do pay the CEO of Goodwill 
three-quarters of a million dollars, they 
certainly can pay me more than they're paying," 
said Harold Leigland, who is legally blind and 
hangs clothes at a Goodwill in Great Falls, Montana for less than minimum wage.

"It's a question of civil rights," added his 
wife, Sheila, blind from birth, who quit her job 
at the same Goodwill store when her already low 
wage was cut further. "I feel like a second-class 
citizen. And I hate it." Section 14 (c) of the 
Fair Labor Standards Act, which was passed in 
1938, allows employers to obtain 
minimum wage certificates from the Department of 
Labor. The certificates give employers the right 
to pay disabled workers according to their 
abilities, with no bottom limit to the wage.

not all, special wage certificates are held by 
nonprofit organizations like Goodwill that then 
set up their own so-called "sheltered workshops" 
for disabled employees, where employees typically 
perform manual tasks like hanging clothes.

The non-profit certificate holders can also place 
employees in outside, for-profit workplaces 
including restaurants, retail stores, hospitals 
and even Internal Revenue Service centers. 
Between the sheltered workshops and the outside 
businesses, more than 216,000 workers are 
eligible to earn less than minimum wage because 
of Section 14 (c), though many end up earning the 
full federal minimum wage of $7.25.
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NBC News

Harold Leigland, who is blind, with his guide dog 
on the bus during his morning commute to the 
Goodwill facility in Great Falls, Montana, where he works hanging clothing.

When a non-profit provides Section 14 (c) workers 
to an outside business, it sets the salary and 
pays the wages. For example, the Helen Keller 
National Center, a New York school for the blind 
and deaf, has a special wage certificate and has 
placed students in a Westbury, N.Y., Applebee's 
franchise. The employees' pay ranged from $3.97 
per hour to $5.96 per hour in 2010. The franchise 
told NBC News it has also hired workers at 
minimum wage from Helen Keller. A spokesperson 
for Applebee's declined to comment on Section 14 (c).

Helen Keller also placed several students at a 
Barnes & Noble bookstore in Manhasset, N.Y., in 
2010, where they earned $3.80 and $4.85 an hour. 
A Barnes & Noble spokeswoman defended the Section 
14 (c) program as providing jobs to "people who 
would otherwise not have [the opportunity to work]."

Most Section 14 (c) workers are employed directly 
by nonprofits. In 2001, the most recent year for 
which numbers are available, the GAO estimated 
that more than 90 percent of Section 14 (c) 
workers were employed at nonprofit work centers.

Critics of Section 14 (c) have focused much of 
their ire on the nonprofits, where wages can be 
just pennies an hour even as some of the groups 
receive funding from the government. At one 
workplace in Florida run by a nonprofit, some 
employees earned one cent per hour in 2011.

"People are profiting from exploiting disabled 
workers," said Ari Ne'eman, president of the 
Autistic Self Advocacy Network. "It is clearly 
and unquestionably exploitation."

Defenders of Section 14 (c) say that without it, 
disabled workers would have few options. A 
Department of Labor spokesperson said in a 
statement to NBC News that Section 14 (c) 
"provides workers with disabilities the 
opportunity to be given meaningful work and receive an income."

Terry Farmer, CEO of ACCSES, a trade group that 
calls itself the "voice of disability service 
providers," said scrapping the provision could 
"force [disabled workers] to stay at home," enter 
rehabilitation, "or otherwise engage in 
unproductive and unsatisfactory activities."

Harold Leigland, however, said he feels that 
Goodwill can pay him a low wage because the 
company knows he has few other places to go. "We 
are trapped," he said. "Everybody who works at Goodwill is trapped."

Leigland, a 66-year-old former massage therapist 
with a college degree, currently earns $5.46 per hour in Great Falls.

His wages have risen and fallen based on 
studies," the method nonprofits use to calculate 
the salaries of Section 14 (c) workers. Staff 
members use a stopwatch to determine how long it 
takes a disabled worker to complete a task. That 
time is compared with how long it would take a 
person without a disability to do the same task. 
The nonprofit then uses a formula to calculate a 
salary, which may be equal to or less than 
minimum wage. The tests are repeated every six months.
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NBC News

Harold Leigland works at the Goodwill facility in 
Great Falls, Montana, where he earns $5.46 an hour.

Leigland's pay has been higher than $5.46, but it 
has also dropped down to $4.37 per hour, based on the time-study results.
He said he believes Goodwill makes the time 
studies harder when they want his wage to be lower.

"Sometimes the test is easier than others. It 
depends on if, as near as I can figure, they want 
your wage to go up or down. It's that simple," he said.

His wife, Sheila, 58, spent four years hanging 
clothes at the Great Falls Goodwill for about 
$3.50 an hour. She said the time study was one of 
the most degrading and stressful parts about her 
job. "You never know how it's going to come out. 
It stressed me out a lot," she said.

She quit last summer when she returned to work 
after knee surgery and found that her wage had 
been lowered to $2.75 per hour, a training rate.

"At $2.75 it would barely cover my cost of 
getting to work. I wouldn't make any money," she said.

Harold said he believes Goodwill can afford to 
pay him minimum wage, based on the salaries paid 
to Goodwill executives. While according to the 
company's own figures about 4,000 of the 30,000 
disabled workers Goodwill employs at 69 
franchises are currently paid below minimum wage, 
salaries for the CEOs of those franchises that 
hold special minimum wage certificates totaled almost $20 million in 2011.

In 2011 the CEO of Goodwill Industries of 
Southern California took home $1.1 million in 
salary and deferred compensation. His counterpart 
in Portland, Oregon, made more than $500,000. 
Salaries for CEOs of the roughly 150 Goodwill 
franchises across America total more than $30 million.

Goodwill International CEO Jim Gibbons, who was 
awarded $729,000 in salary and deferred 
compensation in 2011, defended the executive pay.

"These leaders are having a great impact in terms 
of new solutions, in terms of innovation, and in 
terms of job creation," he said.

Gibbons also defended time studies, and the whole 
Section 14 (c) approach. He said that for many 
people who make less than minimum wage, the 
experience of work is more important than the pay.

"It's typically not about their livelihood. It's 
about their fulfillment. It's about being a part 
of something. And it's probably a small part of 
their overall program," he said.

And Goodwill and the organizations that run the 
sheltered workshops are not alone in their 
support for Section 14 (c). In many cases, the 
families of the workers who have severe 
disabilities say their loved ones enjoy the work 
experience, enjoy getting a paycheck, and the amount is of no consequence.
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NBC News

Sheila Leigland, who is blind, with her guide 
dog. She quit her job at Goodwill in Great Falls, 
Montana, after her hourly wage was lowered to $2.75.

"I feel really good about it. I don't have to 
worry so much about him," said Fran Davidson, 
whose son Jeremy has worked at Goodwill in Great 
Falls, Montana, for more than a decade. "I know 
he's not getting picked on, and he's in a safe 
place. He enjoys what he's doing, and he's happy, 
and that's what we like for our kids." Jeremy 
started out working for a sub-minimum wage but 
did well on his last time study and is currently 
earning $7.80 an hour, Montana's minimum wage.

But foes of Section 14 (c) have hopes for a new 
bill that's now before Congress that would repeal 
Section 14 (c) and make sub-minimum wages illegal across the board.

"Meaningful work deserves fair pay," the sponsor 
of the bill, Rep. Gregg Harper, R.-Miss., told 
NBC News. "This dated provision unjustly 
prohibits workers with disabilities from reaching their full potential."

The bill is opposed by trade associations for the 
employers of the disabled, and past attempts to 
change the law have failed. But Marc Maurer, 
president of the National Federation of the Blind 
and a foe of the sheltered workshop system, is 
cautiously optimistic that this time the bill 
will pass, and end what he called a "two-tiered system."

That system, explained Maurer, says "'Americans 
who have disabilities aren't as valuable as other 
people,' and that's wrong. These folks have 
value. We should recognize that value."

Monica Alba contributed to this report.


Mr. Anil Lewis, M.P.A.

“Eliminating Subminimum Wages for People with Disabilities”
Work: 410-659-9314 ext. 2374
Twitter: @anillife

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