Casey Announces $177 Million to Phase Out Subminimum Wage for People with Disabilities in 14 States; $13 Million for Pennsylvania

An estimated 100,000 people with disabilities are paid less than $7.25 an hour

Casey bill would end practice of subminimum wage for people with disabilities by ending certificates that allow employers to pay people below the minimum wage

Washington, D.C. - Today, U.S. Senator Bob Casey (D-PA) announced that the U.S. Department of Education is awarding $177 million across 14 states to begin phasing out the practice of paying people with disabilities subminimum wage and encourage the creation of inclusive jobs for people with disabilities. Currently, thousands of people with disabilities are being paid less than the minimum wage—most of those workers have intellectual or developmental disabilities—and some can be paid as little as a few cents an hour. The Subminimum Wage to Competitive Integrated Employment (SWTCIE) pilot program will provide five-year grant awards for states to help employers transition to paying competitive, fair wages to people with disabilities. Senator Casey led the fight to include funding for this pilot program in the FY21 federal spending bill. The Pennsylvania Office of Vocational Rehabilitation will receive $13 million to begin phasing out subminimum wage jobs for Pennsylvanians with disabilities.

“Many people with disabilities are being paid below the minimum wage without the possibility of gaining new skills or moving to a job that pays a higher wage. This is incompatible with the promise of our Nation: to provide every American with the opportunity to earn fair wages and achieve financial independence,” said Senator Casey. “This funding will begin to phase out subminimum wage employment in 14 states while protecting the jobs of people with disabilities, but in order to truly end this discriminatory practice, Congress needs to pass my legislation to stop this problem at its root.”

Senator Casey’s bipartisan Transformation to Competitive Integrated Employment Act (TCIEA) would prohibit the U.S. Secretary of Labor from issuing the certificates that allow employers to pay employees below the minimum wage and would phase out the use of subminimum wage practices for all employers over five years. It would provide grants to states or employers, supporting employers transitioning to a business model that pays at least minimum wage to workers with disabilities and continue to provide services to workers with disabilities, particularly to those who need more support in the workplace.

According to the Department of Labor, an estimated 100,000 people in the United States are paid subminimum wage. A 2020 U.S. Commission on Civil Rights report found that between 2017 and 2018, the average wage of a person with a disability working under such certificates was only $3.34 per hour—less than half of the federal minimum wage.

SWTCIE grants will be awarded to state vocational rehabilitation agencies for a transition to competitive employment and integrated workplaces: