Senate Panel: Federal Programs Help Executives, But Fail Workers
By Dave Reynolds, Inclusion Daily Express
October 20, 2005
WASHINGTON, DC--A federal program designed to provide jobs and wages for workers with disabilities -- primarily in sheltered workshops -- is making executives at some non-profit organizations very wealthy, while actually discouraging the placement of those workers in jobs within the community, a U.S. Senate panel heard Thursday.
The Senate's Health, Education, Labor and Pensions Committee is reviewing the 1938 Javits-Wagner-O'Day Act (JWOD), which requires the federal government to set aside some contracts for non-profits that employ people with disabilities. Those contracts include such things as the manufacturing uniforms, canteens, and chemical suits for the U.S. military, and janitorial services at federal buildings.
Senators on the committee learned that 627 organizations received a total of $2.05 billion last year under the program. While the average wage of the 45,000 workers with disabilities under JWOD contracts was around $9 an hour, the Oregonian found that most of those were paid less than the federal minimum wage of $5.15 an hour, under labor laws that allow people with disabilities to be paid on a piece rate or percentage basis.
At the same time, federal labor data analyzed by the Oregonian showed that pay and benefits for top executives at the 50 most active nonprofits rose 32 percent from 2000 to 2003 -- a period which saw military spending increase with the war in Afghanistan and Iraq. In fact, one in five chief executives in those 50 nonprofits earned more than $300,000 in salaries and benefits, the paper found. Executives in JWOD nonprofits earned salaries ranging from $369,000 to $715,000. The national average salary for most non-profit executives is about $126,000, it noted.
Panelists also learned that the law requires non-profits under JWOD contracts to have 75 percent of the labor performed by workers with severe disabilities. This requirement can discourage those organizations from moving their workers from sheltered workshops to community jobs. In fact, fewer than 6 percent of workers in the program were placed in mainstream jobs, said committee chair Senator Mike Enzi, a Republican from Wyoming.
Mike Nelson, who worked for 15 years in sheltered workshops in Colorado, told Senators that he prefers his current job at Hollywood Video.
"You were there and you were just stuck," he said of the sheltered workshops.
An official with NISH, the nonprofit that administers JWOD contracts, argued that the program benefits people with severe disabilities because employers do not want to hire them.
The panel also reviewed the 1936 Randolph-Sheppard Act, which gives priority on government food services contracts to businesses owned by blind people. Last year, about 2,700 blind entrepreneurs participated in the program, generating about $489 million in sales.
Committee staff found that blind-owned companies hired 7,122 employees to work in military cafeterias through their contracts, but that just 615 -- less than 9 percent -- were blind or had another kind of disability.
"It is unconscionable that private companies and employers exploit federal laws to make millions off people with disabilities," said Senator Edward M. Kennedy, a Democrat from Massachusetts, whose sister Rosemary had a developmental disability.
Press release "Investigation Finds Billions Wasted on Programs Congress Intended to Promote Jobs for Blind, Disabled Individuals" (Senate Health, Education, Labor and Pensions Committee)
"Panel: Job programs for disabled inadequate" (Associated Press via Modesto Bee)
"Senator says programs boost CEOs, not disabled" (The Oregonian)