[co-author: Madison Deane, Summer Clerk]

Georgia will no longer allow employers to use 14(c) certificates issued by the US Department of Labor (DOL) to pay certain workers with disabilities below the $7.25 federal minimum wage. The state’s Dignity and Pay Act, which took effect July 1, immediately banned subminimum wages for employers who did not already hold a DOL certificate and will phase out the practice by July 2027 for employers that did. Here’s what you need to know to comply.

Quick Background

The Federal 14(c) Program

• Overview. Section 14(c) of the Fair Labor Standards Act allows employers to pay certain workers with disabilities less than the federal minimum wage. To participate in this program, aimed at expanding employment opportunities for individuals with disabilities, employers must obtain a certificate from the DOL’s Wage and Hour Division (WHD).
• Workers Covered. Section 14(c) applies to workers whose earning or productive capacity is actually impaired by a physical or mental disability, including those related to age or injury. Disabilities that may affect productive capacity include blindness, mental illness, developmental disabilities, cerebral palsy, alcoholism, and drug addiction.
• Subminimum Wage Amounts. A 2023 report by the US Government Accountability Office (GAO) found that more than half the workers it reviewed in the program between 2019 and 2021 were earning less than $3.50 an hour, and some earned as little as 25 cents an hour or even less....

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