Kansas lawmakers are considering a proposal that many disability rights advocates say would encourage employers to continue paying disabled workers less than the minimum wage, bucking a national trend.
A bill in the Kansas House would expand a state income tax credit for goods and services purchased from vendors that employ disabled workers, doubling the total allowed to $10 million annually. A committee approved it Monday, sending it to the full House for debate, possibly later this week.
Vendors now qualify by paying at least the minimum wage to all of their disabled workers, but the measure would allow vendors to pay some workers less if those workers are not involved in the purchase of goods and services to earn the tax credit. Supporters argue that the bill would allow more vendors to participate, which would increase employment and vocational training opportunities for people with disabilities.
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The Kansas debate comes after national employers have moved toward paying the federal minimum hourly wage of at least $7.25 an hour. There were about 122,000 fewer disabled workers in 2019, compared to about 295,000 in 2010, according to a report from the US Government Accountability Office to Congress in January.
Critics argue that below-minimum-wage jobs take advantage of workers like Trey Lockwood, a 30-year-old Kansas City resident with autism, who has three part-time jobs that pay more than minimum wage. At one, The Golden Scoop ice cream shop, he greets customers and makes ice cream with a “spinner,” a machine he said looks like a washing machine. He has money to buy clothes and other things.
“I feel good about that,” he said.
His mother, Michele Lockwood, said employers who pay less than minimum wage are not fostering independence.
Neil Romano, a member of the National Council on Disability, agreed, adding, “It’s very much against the flow of history.”
But advocates and other program operators questioned about their pay said the severity of some physical, intellectual and mental disabilities means such programs cannot be eliminated without taking away valuable opportunities.
Cottonwood Inc., in Lawrence in northeast Kansas, handles packaging for several companies. His wages are based on the prevailing industry standard in the area of more than $15 an hour, adjusted for worker productivity. As workers become more productive, they earn higher wages.
CEO Colleen Himmelberg said Cottonwood helps workers who need one-on-one support that other employers won’t provide.
“They are probably not going to help someone toilet or clean up an accident. That’s the reality,” said Himmelberg. “But that person can work here and still earn a paycheck.”
Pat Jonas, president and CEO of the Cerebral Palsy Research Foundation in Wichita, Kansas, said the goal of a more “user-friendly” tax credit program is burdensome for some sellers. If employers currently want to participate, while maintaining below-minimum-wage jobs as vocational training, they must establish a new separate company or non-profit that pays workers at or above the minimum wage.
“It’s sad that not everyone can be pulling in the same direction,” said Jonas, adding that the foundation has always paid at or above the minimum wage.
Thirteen states block below-minimum-wage jobs for workers with disabilities, including California, Colorado and Tennessee, according to the Association of People Supporting Employment First, which promotes inclusive employment policies. Virginia lawmakers sent a bill last month to Republican Gov. Glenn Youngkin, and there is a bipartisan proposal for a national ban in Congress.
Andy Traub, a human resources consultant in the Kansas City area who works with The Golden Scoop and many larger businesses, said there may be limited space for sheltered workshops, but “not as a default arrangement.” Groups that serve people with disabilities should be asked to help them try “competitive” jobs first, he said.
The federal law allowing exemption from the minimum wage dates back to the 1930s. It is based on the premise that lower wages offset lower perceived productivity among disabled workers and exempt employers must regularly study how quickly employees do their work. A January report to Congress said 51% of disabled employees of exempt employers make less than $3.50 an hour and nearly 2% earn less than 25 cents an hour.
Some advocates argue that they are still fighting vestiges of attitudes from years ago, when many people with disabilities were institutionalized and not educated.
They cite a mid-February meeting of a Kansas legislative committee that highlighted the tax credit provisions of the proposal. The chairman of the committee handling the bill, Representative Sean Tarwater, a Kansas-area Republican, defended programs that paid under the minimum wage.
“They are people who can’t really do anything,” Tarwater told his committee. “If you do away with programs like that, they will rot at home.”
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Days later, Tarwater said he was referring to people with severe disabilities. But his comments shocked national and state disability rights groups.
Connecticut State Representative Jane Garibay, a Hartford-area Democrat, said that “paying fairly is part of being valued as a human being.” She lives with an adult niece with Down syndrome and is sponsoring a bill that would require Connecticut employers to pay workers with intellectual disabilities the state’s minimum wage, $15 an hour, if they can do the job.
“It’s like, as a woman, getting paid less than a man for doing the same job. We’ve been there, right?” Garibay said. “If you’re doing the same job, the pay should be the same.”
In the Kansas City area, the nonprofit Golden Scoop ice cream shop opened in April 2021 paying its workers $8, plus tips — higher than the state’s $7.25 minimum wage. Amber Schreiber, its president and CEO, praises disabled workers as loyal and dedicated. Golden Scoop hopes to open another store and plant that will make ice cream for wholesale sale.
In the Washington DC area, Melwood, a nonprofit, eliminated below-minimum-wage jobs starting in 2016. President and CEO Larysa Kautz said Melwood had to close a print shop with disabled workers doing menial tasks, but he started sorting recycling. service. The organization does government landscaping jobs throughout the area, and between 900 and 1,000 of its 1,300 workers have significant disabilities, she said.
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The report to Congress in January said the number of employers with exemptions that allow them to pay below the minimum wage fell to fewer than 1,600 in 2019 from more than 3,100 in 2010. Romano said it should drop to 1,300 this year.
“It requires innovative thinking,” Kautz said. “But there are so many of us who did it.”