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.
The full analysis lists 4 implications of this text.
Who stands to gain
nonprofit disability employment organizations; state developmental disability agencies; vocational rehabilitation agencies