New Federal Rules on Subminimum Wage

There is a building nationwide movement to end subminimum wage, or “piece-rate,” as you may have heard it phrased.   New Federal rules make it much more difficult for a person to be paid in such a manner.  Though a person can enter our programs in the same way as they always have, they’ll need to obtain a lot of documentation in order to be paid by piece rate.

We have mixed feelings about this.  We strongly believe in integrated, community-based employment paid at minimum wage or higher.  However, this requires a level of supports that is not supported by our funding.  Picture the number of staff it takes to run a job in our workshop…one staff needed for anywhere from 4-10 consumers.  In the community you would need a lot more staff, which we can’t afford based on our current level of funding.  We want what is best for the people we serve but have to do our best right now based on the resources available.  We’d love for that situation to improve.

How does piece rate work at SU?  There are a lot of misconceptions.  Basically we do a time study to see what an average working in the community could get done in an hour.  Then we take off 15% for things that might generally slow down a person and then take off another percentage for fatigue if a person is doing the job for a full day.  That varies with the physical intensity of the job.  Then we divide that new total of pieces per hour into the local prevailing wage (basically what a person doing similar work would be paid after their first raise).  Some of our consumers end up making minimum wage anyway because they are able to work quickly.  Some make less because they aren’t able to go fast, or are learning how to focus or need other supports.

Sometimes when we bid a job for companies, they are surprised we are not a lot cheaper.  But prevailing wage doesn’t mean an unfair wage–it just means there’s an allowance so that people who aren’t able to work at typical productivity levels can still work and we can afford to pay them.  For many of the people we serve, work is about pride and self-worth moreso than a large paycheck.  For some, though, our supports allow them to earn the income they need to live.