Goodwill takes heat over wages

Filed under: Nonprofit,Print | Tags:, ,

The National Federation for the Blind is taking on Goodwill International Industries, hoping that a showdown with the nonprofit organization will lead to a change in federal law.

The Fair Wage Act, enacted more than 74 years ago, allows organizations with certification from the Department of Labor to pay a lower wage to workers with disabilities. In some cases, Goodwill’s disabled workers make as little as $1.44 an hour.

For years, the NFB has called for an end to the little-known measure, but Goodwill is resisting any change. A bill called the Fair Wages for Workers with Disabilities Act has been assigned to a committee in the U.S. House of Representatives, but there hasn’t been any movement since October 2011. A bill-tracking website, govtrack.us, gives the bill only a 5 percent chance of passing.

Locally, Goodwill says it pays its 110 disabled employees at least minimum wage — after including an additional $3.59 an hour as a “health and wellness benefit,” said Judy Valentine, senior director of contract operations for Discover Goodwill of Southern Colorado.

“More than half — 63 — of those individuals earn hourly pay above the minimum wage, excluding the hourly health benefit,” said local Goodwill spokesman Bradd Hafer. “The 47 individuals who earn less than minimum wage have multiple and severe physical and intellectual disabilities that significantly hinder their ability to perform their jobs — including mental retardation, cerebral palsy, traumatic brain injury, Down syndrome and autism.”

Goodwill International estimates more than 420,000 disabled workers in the United States receive less than minimum wage. Nationally, Goodwill pays about 7,300 disabled workers below minimum wage.

“Goodwill supports changes in the FLSA so long as the right of people with disabilities to maintain employment of their choice is preserved,” the organization said in a statement. “The special Minimum Wage Certificate is an important resource to employ individuals with significant disabilities. The certificate enables Goodwill and thousands of other employers to provide opportunities for people with severe disabilities who otherwise might not be part of the workforce.”

Goodwill has lobbied against the congressional measure, prompting the National Federation for the Blind to call for a nationwide boycott of Goodwill and its local subsidiaries, in an effort to force the large, national nonprofit to drop its opposition.

“They are lobbying against the bill that will provide fair wages,” said NFB spokesman Chris Danielsen. “Given the successful programs in mainstream businesses, the NFB strongly feels that this practice is outdated and traps disabled workers in an exploitive environment — keeping them from actually integrating into the workforce.”

Payoff for some nonprofits

The NFB says the policy is a “cash cow” for nonprofits that take advantage of a little-known, outdated federal law. Officials say nonprofits receive philanthropic donations, preferred status on federal contracts and additional federal funding. They say some nonprofits pay their executives exorbitant salaries.

“The economics overwhelmingly favor subminimum wage employers, encouraging the perpetuation of subminimum-wage employment and leaving workers with disabilities little to no choice for real employment,” Danielsen said.

The problem isn’t that disabled workers should be paid less or risk being unemployed, he said. The problem is that nonprofits like Goodwill aren’t matching the disabled people’s strengths to the jobs they’re performing and instead filling any job with any disabled person.

“That’s not what we want,” Danielsen said. “Since they passed the Americans with Disabilities Act, employers have discovered that they can hire people — even with severe disabilities — to do work, and they do it well. You just have to match the person’s skills to the job.”

Goodwill’s perspective differs.

Hourly wages at Goodwill are determined by each worker’s ability to perform duties, factoring in the degree of their physical or intellectual disability, Hafer says.

Essentially, that means comparing productivity of disabled and nondisabled workers, and then paying the disabled worker accordingly, he says. Department of Labor regulations establish a formula to determine salary based on performance.

“Employees with disabilities who demonstrate increased productivity during these assessments receive a commensurate wage increase,” Hafer said.

Differing views

Not all local nonprofits share the same philosophy.

The Arc, a nonprofit that employs about 120 people statewide with physical and developmental disabilities in its thrift stores, doesn’t base pay according to disabilities.

“There is no difference from what we pay any regular employee,” said Kathy McAdoo, director of community events and community outreach. “They are a regular employee, and they get paid a regular wage. We don’t differentiate in any way, shape or form.”

The Arc focuses on creating marketable skills for its workers, she said, and workers are paid at least minimum wage. She knows other groups have obtained the federal certification, but says The Arc doesn’t have one.

“It’s just not our practice,” she said.

It’s also not the practice at AspenPointe, a nonprofit that offers employment and counseling services as well as substance-abuse treatment and jail diversion.

“I didn’t even know that was legal,” said Rick Mack, AspenPointe senior vice president of human resources. “At AspenPointe, we make accommodations for disabilities, but it doesn’t affect pay. And frankly, I’ve never heard of this practice and I’ve been associated with working with people with disabilities for 22 years.”

Hafer says the pay practices benefit the disabled community.

Goodwill is one of 29 organizations in the state with the Department of Labor certification, and one of three in Colorado Springs. Mosaic and Community Intersections also have the designation. Neither returned calls for comment.