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South Carolina Ends Subminimum Pay for Workers With Disabilities

May 24, 2022, 1:07 PM

South Carolina will phase out payment of subminimum wages for workers with disabilities under legislation that Gov. Henry McMaster signed into law.

The bill, S. 533, bars employers from participating in the federal 14(c) waiver program, which lets employers pay below minimum wage to workers with certain types of disabilities. The law, which the Republican governor signed on Monday, calls for ending use of the program by Aug. 1, 2024. It also establishes a task force to plan a transition that prevents workers from becoming unemployed.

  • With McMaster’s signature, South Carolina becomes the 14th state to end the subminimum wage, according to the disability rights group Able South Carolina. Tennessee enacted a similar law in April.
  • The movement among state legislatures mirrors bipartisan proposals in Congress aimed at ending the federal program, which was enacted as part of the Fair Labor Standards Act of 1938. Critics say the program unfairly traps workers in low-paying jobs, while its supporters contend it provides some participants the best hope of finding employment.
  • In 2020, more than 2,900 people in South Carolina held jobs at workplaces participating in the subminimum wage program, according to the bill text.

To contact the reporter on this story: Chris Marr in Atlanta at cmarr@bloomberglaw.com

To contact the editors responsible for this story: Andrew Harris at aharris@bloomberglaw.com; Laura D. Francis at lfrancis@bloomberglaw.com