Pritzker signs bill to phase out subminimum wage for disabled workers

[January 22, 2025]  By Ben Szalinski

CHICAGO — Gov. JB Pritzker on Tuesday signed a long-awaited bill to stop Illinois organizations from paying less than the minimum wage to workers with disabilities.

The bill applies to businesses and other facilities that hold what is known as a 14(c) certificate, named after the section of the Fair Labor Standards Act of 1938 permitting lower wages for disabled people. Organizations receiving the exemption are allowed to pay a “commensurate wage” based on the worker’s individual productivity in proportion to the wage and productivity of workers who do not have disabilities but are performing the same or a similar task.

“Illinois is closing an era of an outdated two-tier wage system that lets disabled workers make less money for their hard work,” Pritzker said at a signing ceremony in Chicago.

The governor signed House Bill 793, which, beginning in 2030, will prohibit businesses and other residential facilities in Illinois from claiming an exemption allowing them to pay workers with disabilities less than minimum wage. Illinois is the 19th state to eliminate the subminimum wage for workers with disabilities. Organizations must phase in the full minimum wage by the end of 2029.

The bill received bipartisan support in the General Assembly in 2024 following lengthy negotiations that began more than five years ago. It creates a transition grant program designed to provide financial support for organizations to continue employing people with disabilities while paying them at least the state minimum wage. It also establishes a task force to oversee the transition.

Money for the transition program would come from the Illinois Department of Human Services’ line item for transforming the state’s developmental and intellectual disability system. That line item includes $20 million for various programs for the current fiscal year, but lawmakers and advocates had previously discussed using $2 million to fund the transition grant program.

Illinois has 59 programs currently receiving a federal exemption. Those programs employ about 2,500 people, according to the U.S. Department of Labor.

Pritzker called on the new Trump administration to end 14(c) exemptions nationwide — a process that began under former President Joe Biden’s administration.

Gov. JB Pritzker signs the Dignity in Pay Act at a ceremony in Chicago on Tuesday, Jan. 21, 2025. (Capitol News Illinois photo by Andrew Adams)

“People with disabilities dream big,” said Erin Compton, a person with disabilities who advocated for the law. “Let’s prove that people with disabilities are not broken people in a normal world, but normal people in an inclusive world.”

Opposition in Springfield came from some of the state’s largest operators of “sheltered work” programs, which employ people with disabilities to perform work for less than minimum wage and often do work that is outsourced from other businesses.

Those organizations, and people with family members participating in them, argued the bill will force those programs to end at places that can’t afford to pay minimum wage for potentially low-productivity work.

Sen. Jil Tracy, R-Quincy, voted against the bill and told a Senate committee in November her brother has a disability and is paid less than minimum wage to shred paper for a business.

“How in the world are they going to be able to pay minimum wage is my question? What happens if that shredding paper employment goes away?” she said.

Lawmakers and stakeholders agreed to create a task force and five-year phase in period to work out issues that arise from the transition with the goal of keeping people who benefit from the programs employed.

“My excitement today is not just because we are making history here in Illinois, but also because of all the hard work advocacy and activism that it took to get here,” bill sponsor Rep. Theresa Mah, D-Chicago, said Tuesday. “To say that this was a challenging bill to pass would be an understatement. There was a lot of opposition.”

Capitol News Illinois is a nonprofit, nonpartisan news service that distributes state government coverage to hundreds of news outlets statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.