Somewhere in America, a worker with Down syndrome is stocking shelves at a grocery store, performing the same task as the person next to him. He may be legally making less than the minimum wage under federal law, sometimes much less. That isn’t an old-fashioned loophole. It’s a certified, active practice. And as of this year, the federal government has determined that it should remain that way, for the time being at least.
A proposed rule that would have gradually eliminated Section 14(c) of the Fair Labor Standards Act, which permits employers to pay employees with disabilities less than the federal minimum wage of $7.25 per hour, was recently withdrawn by the Trump administration. The proposal was made in December 2024 by the Biden administration, which claimed that these certificates were not only unnecessary but also unjustifiable due to decades of legal and social advancements. In July 2025, the Trump Department of Labor withdrew the proposal due to legal limitations. Their stance is that since the statute uses the word “shall,” the department must grant certificates to eligible employers upon application. They don’t consider it an option.
It’s worthwhile to consider the true meaning of Section 14(c). Enacted in 1938 and last significantly amended in 1989, it permits employers, frequently nonprofits operating sheltered workshops, to determine wages based on an employee’s “productive capacity” in comparison to an individual without a disability performing the same task. It was supposed to open doors. In reality, it has kept a sizable portion of disabled workers on wages insufficient to pay for a weekly grocery run. Approximately 424,000 workers were employed under these certificates in 2001, according to data that shows a gradual decline. That figure dropped to roughly 40,579 by 2024, but it was still a real number and real people.
Opponents of the program’s termination contend that sheltered workshops provide structure, community, and meaningful activity that competitive employment can’t always match for certain workers, especially those with severe intellectual or developmental disabilities. That argument isn’t wholly baseless. One former participant reminisced about the joy of doing woodworking with his hands. A caregiver explained how her son’s physical limitation was addressed by strengthening his grip through repetitive workshop tasks. These individuals weren’t just being taken advantage of; for some, the surroundings provided something. For others, however, it was a dismissive experience. In the words of another caregiver, her son “was more capable than what they were doing.” There is no clear resolution to that tension.
The current situation is noteworthy because of how isolated the federal position appears to be. Sixteen states have completely abolished subminimum wage employment in the past ten years. Colorado, Oregon, and other states have made progress toward competitive integrated employment, sometimes cautiously, sometimes imperfectly. At the state level, there is a genuine momentum that has been growing throughout both parties’ administrations. The National Council on Disability has stated unequivocally that Section 14(c) is discriminatory. Its chair, Claudia Gordon, contended that eliminating the certificates would guarantee that employees with disabilities are “treated with dignity and respect” and given a real chance at financial security.
Although it slows the movement, the federal retreat does not stop it. It represents continuity for the approximately 800 employers—hospitals, companies, and community rehabilitation programs—that still possess these certificates. Additionally, even though the ethical argument against subminimum pay has become more compelling, it still remains federally sanctioned for the workers covered by those certificates.
It’s still unclear if Congress will eventually intervene to resolve the issue legislatively, which is arguably where this decision belongs anyhow, or if a future administration will reexamine the matter. It’s becoming more and more obvious that the pressure won’t go away. States are demonstrating the effectiveness of integration. Employees with disabilities are demonstrating on a daily basis in regular workplaces that the 1938 law’s ceiling was never really about what they could accomplish.
