Section 14(c) of the Fair Labor Standards Act lets employers holding a certificate pay workers with disabilities a productivity-based wage below $7.25. The Department of Labor proposed phasing the program out in December 2024, then formally withdrew that proposal on 7 July 2025, so the certificates continue. Certificate holders have fallen from about 5,600 in 2001 to roughly 800 by 2024, and at least sixteen states have eliminated subminimum wages under their own law.
How the certificate works
An employer applies to the Wage and Hour Division for a certificate. The wage is set by comparing the worker’s measured productivity against the prevailing wage for the same work performed by workers without disabilities. Productivity must be re-evaluated at least every six months and the prevailing wage at least every twelve, and certificates run for one to two years before renewal.
The measurement is performed by the employer, which is the structural criticism most often made of the program.
What happened to the phase-out
In December 2024 the Department proposed to stop issuing new certificates and to let existing holders operate for up to three more years, having preliminarily concluded that subminimum wages were no longer necessary to prevent a curtailment of employment opportunities. Around 18,000 comments were filed.
On 7 July 2025 the Department withdrew the proposal, formally discontinuing the rulemaking. The stated reasons included legal uncertainty and concern about the effect on community rehabilitation programs. Any guide written between those two dates describes a phase-out that is not happening.
The states moved anyway
At least sixteen states have ended subminimum wages for workers with disabilities under their own law, and more have partial restrictions. Where a state has done so, the state rule governs regardless of any federal certificate.
The direction of travel
The number of certificates has fallen by roughly seven-eighths since 2001 without any federal rule change, driven by state legislation and by employers moving to competitive integrated employment.
What to check
Whether your state has eliminated the subminimum wage, and whether your employer actually holds a current certificate. A reduced wage without a valid certificate is simply an underpayment.
Common questions
Can workers with disabilities be paid below the minimum?
Under Section 14(c), yes, where the employer holds a current certificate and the wage is set against measured productivity.
Was the program not being ended?
A phase-out was proposed in December 2024 and formally withdrawn on 7 July 2025. The certificates continue.
How many certificates are there?
Roughly 800 by 2024, down from about 5,600 in 2001, largely because of state legislation and a shift to integrated employment.
Do states allow it?
At least sixteen have eliminated subminimum wages under their own law. Where they have, the state rule governs.
What if there is no certificate?
Then a reduced wage is simply an underpayment, and the full applicable minimum is owed.