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SUBMINIMUM WAGES AND DISABILITY RIGHTS

The FLSA and the practice of paying subminimum wages to workers with disabilities enjoyed a hiatus from oversight as the sheltered-workshop model spread throughout the country. Local chapters of the ARC, then known as the Association of Retarded Citizens sought to bring employment to their loved ones and invested heavily in this pursuit, even if the most abundant commodity at their disposal was time. In Memphis mothers of young adults with developmental disabilities went door to door selling canned beans as part of a fundraiser to garner money for a down payment on construction of a building downtown to house a sheltered workshop.1 They were not alone. The early and mid-1960s saw a rapid expansion of sheltered workshops designed and operated to serve different disability populations. There were programs for those with cerebral palsy, epilepsy, veterans with disabilities, and people with mental illness. The application of 14(c) grew and was adapted for different settings, which meant new construction of buildings that mirrored the regulations. One such configuration was designed as a vocational rehabilitation center, replete with a sheltered workshop and ancillary supports including psychological, medical, and social services, perhaps an early variety of what we might today call a health home. The idea that most workers would have multiple well-being issues that could be coordinated in one central place seemed sound, but because of the history of disability in the United States, these developments were rooted in segregation, congregation, and poor pay.

The concerns and lack of oversight regarding subminimum wages persisted, however. In June of 1965, a Democratic senator from Oregon sought to fix the 14(c) certification process by offering amendments that would at the very least create a system that was more equitable to those with fewer barriers to employment. This was the unofficial start to decades of hearings and oversight committees. The efforts would start strong, with purpose and insight, and end up being stalled by players other than the workers with disabilities themselves. Senator Wayne Morse, who had sought his party’s nomination for president in 1960, desired to bring attention to a law that by this point had been in operation for two decades. As Blatt and Kaplan, working in separate realms, were conceptualizing their covert entry into some of the country’s most horrendous institutions in the summer of 1965, Senator Morse sought to provide economic relief to workers with moderate disabilities, believing they should receive the full minimum wage of $1.25, which in 2020 dollars would be $10.27 per hour. Senator Morse was first a Republican, then an Independent, and finally a Democrat. He opposed the Vietnam war. He had grown up on a farm where his family raised beef, hogs, horses, sheep, poultry, and grain crops. He knew labor and understood that work was essential to one’s identity, that fair compensation afforded people the opportunity to move out of poverty. The Morse proposal sought to aid those workers with moderate disabilities in receiving minimum wage over a transitional period of three years; it carried an amendment for those workers with more significant disabilities under 14(c) to be paid at least 50 percent of the minimum wage. This notion of making change gradually, of not upsetting the human-service agencies employing worker with disabilities, would become an ongoing refrain that can be found in current efforts to abolish the practice of paying subminimum wages. At times, the transitional period is referenced in terms of concerns for the workers themselves, with lobbyists arguing that the change would confuse those being paid subminimum wages or thrust workers into a harsh real world. At other times, when proposals like the one Morse endorsed were presented, the leadership of the sheltered-workshop agencies focused on their need for more time to change their business model. These clichéd complaints stymied change and acted to stall or stop outright progressive moves to ensure that workers with disabilities were compensated fairly.

This was the case with the Morse proposal. During the 1965 congressional hearings the sheltered-workshop operators testified that Morse’s proposal was unrealistic, some arguing that it would be a drain on the economy. Representatives from the National Federation of the Blind (NFB), the same organization that forty-seven years later, in 2012, would urge a national boycott of Goodwill for paying some workers as little as twenty-two cents per hour, also attended the hearings and urged that the proposal be adopted fully. Stating that workers with disabilities should be afforded “the same protection of federal law now available to millions of other workers” in the United States, NFB representatives pointed out that there was just too much opportunity for section 14(c) to be misapplied. “It permits ready abuse at the expense of handicapped workers.” And as in the current debate, uneasiness was raised regarding oversight at the Department of Labor’s Wage and Hour Division, “particularly in the absence of a vigorous investigation and enforcement program.”2 The latter concern would prove prescient: the abuses of the men at Henry’s Turkey Farm had gone on unabated from the 1970s until they were exposed in 2009.

However, the sheltered-workshop leaders prevailed, and the legislation was watered down. The Morse proposal ended up as an inane linguistic configuration in the story of workers with disabilities and pay. In addition to the term “sheltered workshop,” a new name was adopted for workers with severe disabilities. The places where they worked under 14(c) certificates awarded by the USDOL would be referred to as “work activity centers.” The work performed by these workers was not believed to be substantial enough to warrant minimum wage and could be as low as one penny per hour, since there would be no wage floor. Work-activity centers were defined as “centers planned and designed exclusively to provide therapeutic activities for handicapped clients whose physical or mental impairment is so severe as to make their productive capacity inconsequential.” That phrase alone embodies the extent to which low expectations pervade the entire system. In one of the first significant mandates from Congress regarding 14(c) oversight, the Morse proposal set in motion an ongoing request to review the way that “handicapped clients of sheltered workshops” were paid. Notice, the term “client” rather than “worker,” a distinction that symbolizes one of the cornerstone issues in the systems that both employ and provide services to people with disabilities. When is one a client, receiving services, and when is a worker with a disability, given the right to form labor unions and negotiate wages, hours, job tasks, and other work site considerations? The mixing of not only the terms and roles but also the approaches and expectations of the sheltered-workshop system would make tracking outcomes and associated oversight requirements a convoluted enterprise at best. Burton Blatt recognized this strange dual role of people with disabilities living in institutions. With his characteristic knack for challenging the ever-present classifications, and possibly to take the power out of an antiquated term, he penned a novel titled Revolt of the Idiots.

The USDOL report that Congress directed be created as a result of the Morse proposal and the associated hearings were damning. What is so strange about the history of subminimum wages in the United States is the belief that only in the last decade or so have advocates, politicians, and workers with disabilities spoken up about its inherent flaws and shortcomings. Instead, the 1967 report on the study of 14(c) as a wage structure pointed out several specifics that seemed as though the sheltered-workshop industry had not been completely forthright during public remarks to the Senate Subcommittee on Labor. “Instead of increasing wages, the workshops had reinvented themselves as work activity centers to avoid the statutory minimum wage rate.”3 This issue would only catch on more and more in the coming years, and it’s important to understand how a worker employed in a sheltered workshop just a year earlier could be reevaluated and consequently moved to the work activity center operations. It’s crucial to understand this development because there is currently an analogous transition of people from subminimum wages to other services that do not include a vocational emphasis.

In the end, the USDOL argued that if wages were increased for workers with disabilities, the likely outcome would be that the sheltered-workshop leaders would simply move people into work activity centers at a faster pace. Reiterating their concerns, professionals from USDOL told Congress that instead of focusing on improving their approaches to training adults with disabilities, especially workers with intellectual disabilities, the agencies using 14(c) would simply reclassify the “sheltered workers” so they could pay as little as possible. It would be easy to assume unscrupulous intent here, but it’s more constructive to understand an important divergence in professionals’ view of learning. Blatt and others had argued and researched “educability.” The premise was that children and adults with the labels of “mental retardation” (an outdated term that has been replaced by “intellectual disability”) were not untrainable or uneducable. They were like all human beings in terms of learning. If presented new material aimed at acquiring new skills via an adapted format, and if the focus were on the professional’s approach rather than presumed deficits of the learner, progress could be made. This new way of thinking about people born with intellectual disabilities challenged the fields of psychology, psychiatry, health care, special education, and the emerging field of vocational rehabilitation as applied to intellectual disability. The 1967 USDOL report highlighted a fracture in the way two different parts of the employment-and-disability field perceived its primary beneficiaries. If one doesn’t believe a worker in a sheltered workshop can learn, improve, and master new tasks, then the idea of paying at least minimum wages seems out of reach. Once more, the fragmentation in research, practice, and policy, along with the general public’s understanding of the issues, was clearly on display.

As has been the case over the last eighty-three years of 14(c), the attention and legislative focus on the complex policy issues would be put on hold; in this case not until 1978 would there be substantial hearings in Congress to seek a remedy. In his 2005 report for the Congressional Research Center, titled, “Treatment of Workers with Disabilities Under Section 14(c) of the Fair Labor Standards Act,” labor economist William Whitaker summarizes the DOL report from 1967. In his estimation, looking back at those first hearings, there are some implicit questions raised. “Might the very nature of sheltered employment be conducive to exploitation of the worker with disabilities? In the absence of a union, who would speak for such workers?” And the last question continues to be a fundamental quandary as it relates to the primary function of the sheltered workshop: Is it feasible to combine in one entity the roles of care-giver, therapist and employer?

One could add to those roles, advocate, rehabilitation provider and legislative liaison. It’s not uncommon for workers being paid subminimum wages to be represented to lawmakers through a trade group whose primary objective is to keep funding coming in to support the continued operation of the provider systems. To understand this fundamental problem of multiple roles, imagine your primary-care doctor also being your employer, or if your boss was also your therapist, seeing you at your most vulnerable and knowing all your shortcomings firsthand. And finally, try to sort through how maddening it might be if someone other than you yourself also served as the main representative for your political concerns, such as voicing your rights regarding something you personally care deeply about, as in LGBTQ rights, gun control, or reproductive rights. The point that Whitaker is making through his proffered question is one that few ponder. How do the voices of people with significant disabilities get heard in this convoluted scenario when so many variables in the design of the system are cloaked in competing roles? The answer is no clearer now than in 1967. In the case of Henry’s Turkey Farm and its abuses, add to these roles that of being a person’s payee for social security checks and the landlord. Perhaps one of the reasons the abuse went unreported was that the citizens in town believed the operators were first and foremost caretakers, with the best interest of the men as the driving force in their decision making. Recall Anil Lewis telling us about the insidiousness of benevolence; the disability industrial complex benefits from regular citizens believing that all activity related to organizations that appear to be helping people with disabilities must therefore be good and upright, with only the best intentions for those in their care, in their employ, and in the totality of their operations. The terms “nonprofit,” “disability service provider,” and any name that pulls at our heartstrings, gets a pass on scrutiny. It’s a dangerous assumption.

A decade went by, and the numbers of workers with disabilities entering employment under section 14(c) grew at a rapid pace. By 1977 nearly 200,000 workers were earning subminimum wages. More than 3,500 sheltered workshops were in operation, but that number may have been higher, as some workshops operated without bothering to formally obtain a 14(c) certificate to pay subminimum wages from USDOL.4 The work activity centers where there was no wage floor for work performed by people with severe disabilities were sometimes overlooked when USDOL increased its onsite reviews.

The 1970s saw a more organized and purposeful approach to advocating for the rights of people with disabilities, with a focus on challenging the way that citizens with disabilities were treated in the public domain. The first legal definition of developmental disabilities was granted in 1970; Ed Roberts, who would later go on to become the first commissioner of a state vocational rehabilitation agency with a significant physical disability after that same agency had deemed him “unfeasible for employment,” helped found the Physically Disabled Students Program (PDSP) at the University of California in Berkeley. In 1971 the US district court in Wyatt v. Stickney decreed that people in residential state schools and institutions (like the ones Blatt and Kaplan had snuck into six years before) have a right to receive quality services, including vocational services, that will actually benefit them, stating, “People should be given a realistic opportunity to be cured or to improve their mental state.”5 This may seem like an obvious statement, but this was one of the first times a court had mandated that the disability industrial complex deliver on its promises and use what would later become known as evidence-based practices in doing so. That same year a public television station in Boston began captioning its programming so that viewers who were deaf could gain information. Groundbreaking court decisions in Washington, DC, and Pennsylvania set the precedent for the passage of the 1975 Education for All Handicapped Children Act, which finally made it illegal to exclude children with disabilities from public schools. These were important milestones toward the active inclusion and equitable treatment of US citizens with disabilities, but the strides were also fragmented, sometimes pursued by or on behalf of specific disability “types”: people with sensory barriers, children with disabilities, adults with physical disabilities in university settings, and those held captive by institutional settings. Like so much of social change in America, the approach was messy, with competing interests, including large nonprofits that claimed to be lobbying for people with disabilities.

The year 1973 saw the first handicapped parking stickers introduced in Washington, DC, as well as the passage of capital aid in the way of authorized federal funds for the construction of curb cutouts, a fundamental adaptation to sidewalks. This enabled people who used wheel-chairs to navigate community pursuits safely, allowing them to get to and from work without risking death while crossing whatever makeshift path was available. And in 1973 the most far-reaching legislation was passed, which would resonate outward and echo across the decades. Known as the Rehabilitation Act of 1973, the historic language stated in part: “No otherwise qualified handicapped individual in the United States, shall, solely by reason of their handicap, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any program or activity receiving federal financial assistance.” Passage of the legislation required a grueling fight; businesses and government alike declared the Rehab Act would bankrupt their enterprises. It did not. The groundwork laid in the Rehab Act of ’73 would go on to serve as the basis for lawsuits filed on behalf of workers with disabilities who were being paid subminimum wages. Some have called the Rehab Act the finest civil-rights legislation ever passed because of its guarantees of equality across a broad range of public services. But would it be enough to carry the changes that subminimum-wage workers needed when their voices were muffled by so many other rival interests? Just the year before in 1972, the Association of Persons with Severe Handicaps (now known as TASH) had been founded by special educators who believed the right to a free and appropriate public education for students with even the most significant intellectual disabilities was still not generally being provided; where it was, there were significant delays from school boards and concerned taxpayers, once again bemoaning the drain that such rights would put on county and state budgets. By 1977 disability-rights activists across ten major US cities orchestrated demonstrations to urge the Carter administration to truly enact section 504 of the Rehabilitation Act of 1973. Section 504 is the key portion of the legislation; it mandates antidiscrimination and emphasizes civil rights to ensure that the needs of students with disabilities are met as adequately as the needs of the nondisabled. Across disabilities, age groups, and rural and urban areas, the idea that people with disabilities, their advocates, and other stakeholders could make a difference by applying pressure politically was starting to gain momentum. It was in this atmosphere that the next major hearings would occur regarding the FLSA 14(c) certificates allowing for subminimum wages. Surely, with the tailwinds in their favor, representatives from USDOL and the sheltered-workshop industry would agree to significant changes to overhaul the antiquated provision. Unlike the cross-disability efforts earlier in the decade, however, these new hearings would focus on just one group, those who were blind or vision impaired.

In May of 1978, Phillip Burton, a representative from California’s 6th district (Speaker of the House Nancy Pelosi now occupies the seat) held hearings hosted by the House Subcommittee on Labor Standards. Again, the National Federation of the Blind (NFB) would be pivotal in the hearings, and the leaders were motivated by their past. The NFB had been founded in 1940, just two years after the passage of the Fair Labor Standards Act. NFB articulated its guiding principles clearly: “Blind people have an inalienable right to independence, . . . blind people have equal capacity, and . . . only blind people themselves can legitimately speak for the blind community.” The NFB had stated an early version of what would later become known as a self-advocate rallying cry: “Nothing about Us without Us” which gained use in the post-ADA 1990s.

There’s a strange irony in what Representative Phillip Burton hoped to accomplish; he intended to make sure that blind and visually impaired workers were paid at least minimum wage, but he also didn’t want these same workers to be excluded from the sheltered-workshop setting. This kind of exclusion/inclusion verbal play will dominate the ongoing debates about who (and less artfully, which disabilities as a whole) should be in sheltered workshops or offered jobs in the community with regular wages. While not entirely deliberate, different groups will be favored over others. The notion that disability in all its forms (including old age, mental health, and neurodiversity) is part of the human condition comes in direct conflict with competition for civil resources. For many legislators the messages to government become mired in confusion over priorities. When the layer of nonprofit lobbying activities is added on top of this dynamic, it’s not surprising to find drawn out and sometimes incomprehensible attempts to remedy the situation with legislation. Some legislative representatives have stated, “You all need to get on the same page. One group wants equal pay, the other wants to keep sheltered programs.”

James Gashel, representing the NFB, was present to testify at the hearings. He had only been part of the NFB since 1974, though he would end up working there for more than thirty years. Visually impaired himself, Gashel was a force of advocacy, wit, and perseverance. At the opening session he announced that he was the “only nonindustry” person at the hearings, meaning most of those in attendance and offering opinions were operators of the subminimum-wage sheltered workshops. Still, if one thought the hearings on the Burton proposal would be fully endorsed by advocacy organizations related to disability, and in this case, associations advocating on behalf of workers with disabilities, they’d be wrong. Mr. Gashel feared the proposal would inaugurate “a far-reaching principle . . . that the blind are not to be considered as handicapped workers.” It would also be incorrect to assume that somehow Gashel’s fears were driven by anything more than his desire to create a world where blindness was accepted and even embraced. He had been instrumental in legislative issues related to the Social Security Act, the Rehabilitation Act, the Randolph-Sheppard Act, the Individuals with Disabilities Education Act, and twelve years later in 1990, the Americans with Disabilities Act (ADA). The professionals and legal minds backing the Burton proposal, which would have banned paying sub-minimum wages to workers with visual impairments, believed that these workers were being exploited by the payment of subminimum wages. The backers of the Burton proposal could not see these same factors at play in workers with disabilities other than visual impairments. They were concerned that blind people entering sheltered workshops were at risk of “backsliding” in terms of their skills, both in learning and keeping new skills, impacting these workers’ view of themselves. While the phrase “soft skills” was not used much in 1978, there was also concern that workers with visual impairments entering the sheltered workshops would develop decreased abilities in managing emotions and interactions with others and would have lower self-esteem. Decreased social and interactive skill sets are yet another instance of confusion inside the disability industrial complex; rehabilitation provider agencies often cite them to justify a person’s inability to work at a real job in the community. Yet, every one of us can recall a coworker, maybe even a supervisor, from the past who did not possess excellent soft skills. The argument is one of the many “readiness traps” set by those who benefit from billing state and federal funds to supposedly ameliorate those so-called deficits. The nonprofits that are supposed to be helping workers with disabilities gain skills are incentivized to continue to find additional problems with the worker so that they can prolong the drawdown of state and federal funds, often times for years. It behooves the nonprofit to keep such a worker in a state of continual need, never ready enough to work in the community for fair wages.

Gashel also found fault with the 14(c) certification process itself, calling it “confusing and cumbersome.” While this sounds like an argument against the payment of subminimum wages, Gashel and by proxy, the NFB, were critical of the process, not the outcome. It was the NFB’s president in 2013, Marc Maurer, who would take on Goodwill by organizing boycotts of their stores in order to bring attention to the issue of Goodwill workers of all disabilities earning as little as twenty-two cents an hour. Thus, NFB, while always involved in section 14(c) of the FLSA, also changed its position as more information about abuses came to light. The Burton proposal and hearings also brought up another issue that would become mired in the type of economy within which section 14(c) was being implemented. The US economy at the time was at a peak in terms of manufacturing jobs; in June 1977 manufacturing jobs represented 22 percent of all nonfarm payrolls; today it is less than 9 percent.6 Productivity at the time was understood as how much and how fast a worker could assemble items, and so the criticisms of sheltered workshops not being rooted in good management practices was valid, but it would mean then that the workers earning subminimum wages all favored assembly type jobs instead of tasks the worker preferred and excelled at. Put another way, the poor management of the sheltered workshops should have also focused on the very limited set of tasks that the worker had access to, putting those workers who did not excel at assembly at a disadvantage. This is a critical issue, one that tends to get little attention. Workers under 14(c) are evaluated (using a stopwatch) at least twice a year and on each new job task (usually if a new contract has been secured by management); there is therefore a track record of their “productivity.” This means that someone may be rated as being 17 percent as productive as that of a nondisabled worker performing the same task. It sounds reasonable, until you think about it in terms of your own performance. Suppose someone was rating you on how quickly you could do a task that you would normally self-select out of (say, changing the oil or raking leaves). Your productivity level at a task at which you are not proficient would follow you in other endeavors or might even keep you from getting a job because your speed and skill at folding pizza boxes was slow and inexpert. Often, the first “metrics” communicated about a worker trying to leave behind subminimum wages is their productivity level, sometimes qualified in reference to the task, but usually solely based on that productivity number. Some workers on subminimum wages with physical disabilities that would prevent them from assembling and packaging tasks are rated on their productivity without the aid of assistive technology. Choice and dignity then, is having the freedom to not be evaluated on those things we are bad at. Inside the disability industrial complex workers with disabilities don’t have that choice, while workers without disabilities use this strategy (self-selecting and focusing on strengths) from their very earliest forays into work as an adolescent.

The Burton proposal brought to the forefront several other considerations, some that echo today. Along with questions regarding the management of the sheltered workshops came the claim that often the work required a team and might include a mixture of speed, accuracy, and other performance indicators within a single work group. The industry argued that this approach led to workers learning from one another. This position is in direct contrast to the pervasive views of the same sheltered-workshop industry, which also propagated and profited from the idea that these same workers need sheltering because their abilities are static, rooted in IQ, and therefore incapable of learning, and that special low wages are therefore necessary. In this portion of the hearing, the sheltered-workshop industry is actually arguing that it embraces the notions of “educable” and “trainable” that led to Blatt’s investigations in Christmas in Purgatory, and whose research flew in the face of the prolific deficiency-based paradigm active inside the disability industrial complex. One might conclude, then, as is the case now, that those in favor of keeping section 14(c) and its accumulated theories of viewing a worker through the lens of that person’s deficits, pick and choose which theory of learning to identify with depending upon the issue at hand. Workers need special places to work with special rules; and workers can learn but only if they are governed by these specialized nonprofits that pay subminimum wages. This fundamental conflict is once again connected to the role of the agency providing the services. If an agency receives funding to “fix” or at the very least ameliorate a person’s deficits, it behooves that same agency to focus on the deficits, which if never fixed, will produce more income for that same agency.

The Burton proposal was not adopted. However, it did help to educate some legislators on the stakeholder mix related to employment and disability, especially when it came to which regulations should organize wage structures, and for whom. It was clear that the debate was not purely benevolent, and the testimony surrounding control and accountability could be volatile and fragmented.

However, perhaps the most significant tangible information was uncovered with an analysis of USDOL’s enforcement efforts related to the administration of section 14(c). The primary division responsible for this type of oversight is known as the Wage and Hour Division (WHD) of USDOL. The following statement from USDOL attempts to explain what WHD does. “The Wage and Hour Division’s mission is to promote and achieve compliance with labor standards to protect and enhance the welfare of the nation’s workforce. The Wage and Hour Division (WHD) enforces federal minimum wage, overtime pay, recordkeeping, and child labor requirements of the Fair Labor Standards Act.” At the time, the administrator tasked with participating in the Burton proposal hearings was Xavier Vela. Vela had been appointed to head up WHD by President Carter in May 1977. Vela had been instrumental in running housing, credit, and labor cooperatives in six South American countries, and had been a leader in local labor unions in New Mexico and Washington, DC.7 During the informational portion of the testimony, Vela presented several data points related to the usage and employment of workers earning sub-minimum wages. Just over 163,000 workers were affected under 14(c), housed in more than 3,500 sheltered workshops that had applied for and been given the status to operate such a facility. Vela reported that a total of 155 onsite investigations had been conducted during 1977, nearly a 70 percent increase from 1976, meaning only 46 of the 3,500 sheltered workshops had been visited, fewer than one per state.8 Vela also reported on poor management, high turnover, and a lack of cost and pricing skills by administrators. Ironically, the staff who rated the productivity of workers with disabilities were themselves lacking competence on a task (basic production accounting) integral to their job description.

One result of the 1978 Burton proposal was its impact on journalists. Two reporters with the Wall Street Journal would take notice of the cause. With their backgrounds in investigative journalism, the story contained echoes of Blatt and Kaplan’s work and provided another opportunity for fundamental change.