Thousands of California workers legally make as little as $2 an hour. Why that could change
In California, home to $14 an hour minimum wage, thousands of workers are being paid as little as $2 an hour.
And it’s completely legal.
Under a program known as 14(c), companies can pay Californians with disabilities below minimum wage.
Supporters of the program say it has provided employment opportunities for thousands of people who wouldn’t otherwise get hired. Opponents say the program is exploiting workers who could do the job just as well as others with the right training and support.
Some disability advocates are pushing to end the program: A recent proposal to hike the federal minimum wage to $15 an hour included a provision ending 14(c). But with the proposal stalling in Congress, advocates have put forth a bill in the California Legislature to phase out the program by 2025, joining ten other states including Alaska, Oregon and Texas.
“This is not a partisan measure,” said Sen. María Elena Durazo, who introduced Senate Bill 639. “It’s a measure to offer dignity to those workers with disabilities.”
Segregating workers with disabilities?
$5 an hour.
That’s how much Jackie Armstrong was paid assembling boxes of prunes and dates around 2009, when California’s minimum wage was $8 an hour. Per the rules of the program, she was paid based on how productive she was compared to an average worker without a disability.
Armstrong, who is on the autism spectrum, said she had jobs that paid her at least minimum wage before the Great Recession. But the economic downturn left her no choice but to find work that paid her less than minimum wage, she said. “I still needed to make money to pay my rent, because I was living on my own.”
She said she and other workers with disabilities were seen as less valuable than the others.
“If you are constantly treated as less than, you think of yourself as less than,” said Armstrong, 35 in Roseville.
In 1938, federal government established minimum wage. But legislators carved out several group of workers from the bill, including those with disabilities. The carve-out was intended to offer job opportunities to disabled veterans, Durazo said.
To qualify for the program, employers need a certificate from the government. They are required
to measure workers’ performance at least every six months and adjust their pay accordingly.
Durazo said 81 employers have such certificates in California, mostly nonprofits. There’s no single estimate as to how many Californians with disabilities are in the program now, but it could be as many as 14,000 people, said Carl London, a lobbyist for the Alliance Supporting People with Intellectual and Developmental Disabilities, which represents community-based agencies, including some 14(c) providers.
Some disability advocates see the program as a relic of the 1930s that doesn’t address the needs of their community.
The program is also ripe for abuse, advocates said. A 2020 report from the United States Commission on Civil Rights, which recommended the federal government to end the carve-out, found that more than 88,000 workers in the program nationally over the past 10 years were owed back pay.
“For eight decades, this practice has reinforced a false assumption that people with disabilities are less capable of full employment than people without disabilities,” said Gregory Cramer, a senior legislative advocate for Disability Rights California who is sponsoring the bill. “Decades of research demonstrates that people with disabilities can, with the right support, succeed in a competitive integrated environment.”
Durazo’s bill would ban any new employers in California from getting certificates after Jan. 1. Those who already have certificates would be allowed to pay workers less than minimum wage, but only until Jan. 1, 2025.
The state would also need to create a phase-out plan by Jan. 1, 2023, laying out how it would help people with disabilities find employment.
“Nothing focuses priorities, energy and action like an imminent timeline,” Cramer said. “That’s what we need if we truly want to give transformation of the 14(c) model a chance to succeed.”
The bill won’t affect Armstrong, she said. She now has a job as an office technician at Sacramento Municipal Utility District, making what she describes as “a lot more than minimum wage.”
But the bill could open the door for better jobs for thousands of people like her, she said.
“It would mean everyone has a chance to get their foot in the door in a lot of ways,” Armstrong said. “It would give everyone a chance to see what they’re capable of.”
Opposition from disabled advocates
Not every advocate, however, favors the bill. In fact, when the U.S. Commission on Civil Rights issued its report, it noted that 98% of more than 9,700 public comments opposed ending the program. Many of those comments came from the family members of those with a disability, the commission said.
London, who has a son who had worked in a 14(c) program, said his son got fewer hours of work when he moved to a job that paid him minimum wage.
“If you take someone working 20 hours a week working sub-minimum wage to a job where you are working three hours a week making minimum wage, is it a success?” he said.
There just isn’t enough support for people with disabilities to find jobs without programs like 14(c), he said. According to the 2016 data from the California State Council on Developmental Disabilities, only 14% of those with developmental disabilities were employed.
“Where does the road hit on the pragmatic versus philosophical?” London said. “You just accomplished a slogan... But that also means if you kill the 14(c) program, many of them won’t work.”
Barry Jardini, the executive director of the California Disability Services Association which represents providers, said his group has not taken a position on Durazo’s bill. But he cited a 2019 report submitted to the California Department of Developmental Services, which he said found the system to help those with developmental disabilities would need another $1.8 billion to meet the needs of providers and the disabled.
“The gap means we don’t have resources and funds for job discovery and career exploration,” Jardini said. “It ultimately means we’re not paying job coaches what they deserve in the state.”
The state can also provide incentives to providers for referring people to good internships, he said.
“If we are not thoughtful in transition from it, thousands of people will be out of a job,” Jardini said.
Durazo’s bill is set to be heard in the Senate Human Services Committee on April 20.
This story was originally published April 20, 2021 at 5:00 AM.
