STERLING – Self Help Enterprises has sent a letter to disabled workers and their guardians informing them that 2 years' worth of back pay owed them will be delayed.
The letter, dated Sept. 6, said Self Help negotiated an agreement with the Department of Labor that extends the deadline for payment of back wages to Nov. 11, 2018.
The nonprofit, which has a sheltered workshop, learned in April that it would lose its certification that allows the organization to pay disabled workers less than the $7.50 federal minimum hourly wage. The action was taken after an investigation by the U.S. Department of Labor determined that nearly 250 workers were exploited.
The investigation cited Self Help’s failure to conduct wage surveys in a timely fashion or time studies on all of the jobs done by disabled workers. The Department of Labor also reported that Self Help tried to obstruct its investigation by covering up relevant information, and at times, had unlawfully paid workers with gift cards.
In addition to paying back wages, Self Help was ordered to pay its workers at least minimum wage going forward.
Self Help filed a petition with the Department of Labor to review its decision on the substandard minimum wage decertification. The request was approved and assigned to a federal administrative law judge. Having a pending review enabled Self Help to get the back pay deadline extended.
"Please understand that the delay in payments is not because the agency is not prepared to issue the checks. We are in a legal process of appeal and must be patient with that legal process," the letter signed by Executive Director Carla Haubrich said.
The Department of Labor refused to comment on the case, citing its ongoing status. Haubrich told consumers and their guardians that it would be unwise to depend on the money owed to them.
"I encourage you to be cautious in making plans to spend your back wages, as the circumstances could easily change again," the letter said.
With the Department of Labor remaining silent, it was unclear how long the back pay conceivably could be delayed. While a new deadline has been set, the letter indicates that further delays are possible, perhaps until there is a ruling on the appeal.
The substandard wage certificate is given in accordance with Section 14(c) of the Fair Labor Standards Act, with the intent of offering disabled workers more job opportunities to compensate for lost productivity.
The certificate sets up a formula allowing employers to determine a fair subminimum wage when physical or mental disabilities lower productivity. The wages are calculated as a percentage of the rate paid to experienced workers for similar jobs in the area.
Less than a week after the Department of Labor's action against Self Help, a group of Democratic senators, including Tammy Duckworth of Illinois, sent a letter to Labor Secretary Alexander Acosta calling for an end to the Section 14(c) minimum wage exemptions.
In the meantime, the lawmakers asked Acosta's department to provide a long list of requested information in an effort to improve oversight and prevent worker abuse.
Supporters of the substandard wage allowances argue that without it many disabled people wouldn't be able to participate in the workforce.
Below is the text of the letter Self Help Enterprises sent to disabled workers and their guardians informing them that 2 years' worth of back pay owed them will be delayed.
September 6, 2018
Dear Consumers, Parents and Guardians,
As you are aware, Self Help previously submitted to the Department of Labor a Petition for Review asking that the Wage and Hour Division review the April 18, 2018 decision that revoked our sub-minimum wage certificate authorizing us to pay piece rate for work completed. The Department of Labor, Wage and Hour Division accepted Self Help’s Petition for Review and the case has been assigned to an Administrative Law Judge. The process is now underway.
While the review is pending we negotiated an agreement with the Department of Labor, tolling or extending the due deadline for payment of any back wages. The deadline is now November 11, 2018. Please understand that the delay in payments is not because the agency is not prepared to issue the checks. We are in a legal process of appeal and must be patient with that legal process. I encourage you to be cautious in making plans to spend your back wages as the circumstances could easily change again.
I appreciate your understanding during this very difficult time. If you have questions I certainly will, to the best of my ability, answer them.