Congress phases out subminimum wage jobs for workers with disabilities
S. 2438 — Transformation to Competitive Integrated Employment Act · Filed by Chris Van Hollen (D-MD) · 7 cosponsors · Introduced Jul 24, 2025 · Referred to committee
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What it does
This bill phases out 'special certificates' under federal law that allow employers to pay workers with disabilities below minimum wage, replacing them with competitive integrated employment at fair wages. It provides $3–15 million grants to states and $200,000–$750,000 grants to individual employers to transform their business models, support workers in transitioning to regular jobs, and provide wraparound services. Over 5 years, the minimum wage for certificate holders rises from 60% to 100% of federal minimum wage, and no new certificates can be issued after enactment.
Why we flagged it
The bill's core mechanism is eliminating subminimum wage employment for people with disabilities and mandating transition to competitive integrated employment at fair wages. This is a civil rights and labor protection measure, not a market-driven or corporate benefit bill.
What the text implies
- Employers currently relying on subminimum wage labor face significant operational restructuring; some may exit the disability employment sector entirely rather than transform, potentially reducing total employment opportunities for workers with disabilities in the short term.
- The bill's success depends heavily on state and local capacity to provide wraparound services and competitive integrated employment infrastructure; states with weak disability services systems may struggle to meet transformation timelines.
- Medicaid funding and home-and-community-based services (HCBS) compliance requirements are central to the bill's design, creating interdependencies with state Medicaid agencies and potentially affecting broader HCBS policy implementation.
- The 5-year wage phase-in (60% to 100% of minimum wage) may incentivize employers to accelerate workforce reductions or automation during the transition period rather than invest in worker support.
Who it affects
Workers with disabilities currently earning subminimum wages gain a guaranteed path to fair wages and competitive employment. The bill mandates wage increases, provides transition support, and requires integration into community employment settings rather than segregated workshops. Families and advocates gain meaningful input through advisory councils.
Who stands to gain
- nonprofit disability employment organizations
- state developmental disability agencies
- vocational rehabilitation agencies
- community-based service providers
- independent living centers
Named in the bill
Department of Labor, Department of Health and Human Services, Department of Education, Fair Labor Standards Act Section 14, Rehabilitation Act of 1973, Olmstead v. L.C. (Supreme Court decision), Workforce Innovation and Opportunity Act, ABLE accounts, Medicaid, Office of Disability Employment Policy, Administration for Community Living, Office of Special Education and Rehabilitative Services
Where it stands
7 cosponsors: 4 Republicans, 3 Democrats.
- Jul 24, 2025 — Introduced · Congress.gov: “Introduced in Senate”
- Jul 24, 2025 — Referred to Senate Committee on Health, Education, Labor, and Pensions · Congress.gov: “Read twice and referred to the Committee on Health, Education, Labor, and Pensions”
Dates and quoted wording are Congress.gov's action record; the timeline shows status changes, not every procedural step.
Money around this bill
7 lobbying clients named this bill on 10 disclosure filings across 2 quarters, Dec 2025 to Jun 2026. Those filings disclosed $440,000 in lobbying spend. A filing names 12 bills on average, so that figure is what each filing reported, not a share belonging to this bill.
More lobbying clients named this bill than 86% of bills with at least one filing.
Chris Van Hollen, the sponsor, reported $81,250 in PAC receipts in the 2026 cycle.
- Society for Human Resource Management — $190,000 on 1 filing
- National Down Syndrome Society — $100,000 on 2 filings
- Coalition for the Preservation of Employment Choice F/k/a 14c Coalition — $60,000 on 2 filings
- Arc of the United States — $50,000 on 1 filing
- National Federation of the Blind — $20,000 on 2 filings
Lobbying Disclosure Act filings through Jul 20, 2026. A filing shows who paid to lobby on a bill it names, not what changed.
How this was measured
Analysis — Quorum's AI read the full bill text on Jul 6, 2026; transparency and hidden-provision scores are compared against the median of 16,222 analysed bills.
Status and sponsors — Congress.gov's bill record — actions, committee referrals and cosponsors — loaded nightly. The timeline shows status changes, not every procedural action.
Money — Senate Lobbying Disclosure Act filings whose specific-issue field names this bill for quarters ending Dec 2025 to Jun 2026. A filing's amount is reported whole beside the median number of bills a filing names; it is never divided across them. PAC receipts are FEC-reported contributions to the sponsor's candidate committee in the 2026 cycle.
As of — lobbying records through Jul 20, 2026 · page rendered 2026-10-20.
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