The Debate on Deviated Wages Continues

Elmer L. Cerano, Executive Director
Michigan Protection and Advocacy Systems, Inc

There is a nationwide debate as to whether or not employers should be allowed to continue to pay a deviated (reduced) wage to people who produce at a rate below the average.

Let me explain. Back in the 1930s, in an effort to allow military veterans with disabilities to find work, the government encouraged employers to pay a minimum wage that was reduced to match the levels of productivity of the worker. In other words, if the employee produced at 70 percent of the rate of the employee without a disability, they would earn 70 percent of the minimum wage.

Sounds like a relatively decent plan to allow people to work to their levels of capacity while not placing an unrealistic financial burden on the employer.

Over the years, this well-intentioned plan took some unfortunate turns.

Some unscrupulous employers doctored time studies and exploited the work and talents of people with disabilities. In other situations employees with disabilities purposely held back on their work hours, productivity and earnings in fear of losing government benefits such as Medicaid, Social Security and others.

So now comes the debate. In part, to reduce the risk of exploitation, should the deviated wage provision be eliminated, and should all employers be required to pay all of their employees at least the minimum wage, irrespective of the level of productivity?

Proponents say that the deviated wage has been and is still being abused and people with disabilities are paid less than the legal minimum wage. Everyone who has a job should be paid at least the legally required minimum wage irrespective of their levels of productivity. People with disabilities are singled out and, overall, they are paid less than people without disabilities.

Opponents of the elimination of the deviated wage provision agree that exploitation and unfair labor practices must stop; however, eliminating the employer’s ability to pay at a rate equal to the level of productivity will force employers to simply not hire people with disabilities.

The solution is, (or perhaps the solutions are) complex. A too simplistic remedy may simply discourage employers from hiring or retaining people who, due to their disability, have lower rates of productivity than their coworkers without disabilities.

The obvious best option is to assist people with disabilities, through creative job carving and the application of modern technologies, to find work where their productivity can be maximized and their earnings commensurate with this increased level of productivity. Level the playing field by increasing the productivity of the employee with a disability.

To do this, however, we need to change the job expectations for students with disabilities and we need to move beyond food, filth, and flowers when we think of good paying job opportunities for people with disabilities.

While we creatively increase productivity, we must also keep an eye on what kind of job opportunities the future will hold for everyone, not just for people with disabilities. If we fail to recognize the rapidly changing nature of work, twenty years will pass and, once again, people with disabilities will be left out of the labor force

It is currently projected that by 2016, Supplemental Security Income (SSI) and Social Security Disability Insurance (SSDI) will cost the American taxpayer over a trillion dollars each year. It appears that the only way to derail this tsunami will be to enable people with disabilities to work, earn a decent wage, and retain their assets.

We need to think beyond our traditional framework if we are to adequately address the issues around employment for people with disabilities. Perhaps there is another approach that might work – one that creates new incentives for the private employer to hire more people with disabilities in a fully integrated community work environment while, at the same time, assuring at least a minimum wage.

Here is an idea that is currently being studied by the Nish Institute on Economic Empowerment for People with Limited Productivity.

First: LEGITIMATELY calculate the true productivity of the employee on a job that has been appropriately carved to match their abilities.

Second: Allow the employer to pay at least minimum wage – adjusted for the employee’s actual productivity (yes, allow for a verifiable deviated wage).

Third: – and this is the cool part –

Allow the employee to file an Earned Income Tax Credit to make up the difference between what the employee actually earned and what should have been earned if the employee were producing at the rate of non-disabled employees.

This way:

• The employer is not forced to pay full wages for reduced productivity.
• The Federal Treasury, not the employer, makes up the difference between earned wages and the minimum wage.
• Earned Income Tax Credits are already available – but perhaps not to the degree necessary to make this work.
• The Federal Treasury reduces its cost for government benefits by allowing the person with a disability to earn money and offset their dependency on government benefits.
• The person with a disability is not at risk of losing their job due to low productivity and high cost to the private employer.
• People with disabilities are allowed to earn money and retain assets that can be used to pay for items and supports that otherwise would be paid for through government programs.

A lot more number crunching needs to be done and variables need to be seriously calculated before these ideas can become a reality. In the meantime, the debate rages on.

There is another debate also raging on the issues surrounding the continued use of segregated worksites for people with disabilities. Why do we still have them and what challenges does the future hold?

I will attempt to shed some light on this controversial topic in the next issue of Exchange.

posted on April 4th, 2011 | Leave a comment »

What Are We Saying?

Ok, I can’t take it anymore.  I have held my tongue and kept the peace.  But no more.  I cannot stand it when people with disabilities are described as “high functioning” or “low functioning”.  These terms continue to be used today by professionals and family members.  Of course people with disabilities have always been the target of labels, none of which are flattering: moron, imbecile, idiot, etc.  Labels are no more than a means to dehumanize, categorize, separate and hurt people.

The fact is we all have different abilities.  We all have strengths and weaknesses.  There are some things that we are really good at and other areas of our lives where we need help and support.  Think about it – what are your strengths?  What are your weaknesses?  Personally, I am good at writing, but struggle with math.  Physically I wear glasses and need hearing aids but am in very good health.  I am a decent skier but have never been able to ride a skate board.  I like spending money but hate to balance the check book (thankfully my wife is good at it).  I like to dance but look funny trying to 2-step and I absolutely refuse to line dance.

Do you know people who are really good at math but cannot write a complete sentence?  How about someone who has many degrees but lacks social skills?  How about the office worker who is great at what they do but their office looks like recycling center?  Are they ever referred to as high or low functioning?  Has anyone ever called you the same?  Probably not.

I suggest that we appreciate each person for all that they are including strengths and weaknesses, and refer to each individual by their name, not a label.  The old childrens’ rhyme, “Sticks and stones will break my bones but names will never hurt me” is not true.  Names and labels do hurt.

Thanks for listening, I feel better.  I can be contacted at rcostales@arcnm.org

posted on July 12th, 2010 | Leave a comment »