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Federal Programs Help Executives, Fail Workers With Disabilities

By Dave Reynolds, Inclusion Daily Express with additional reporting by REO.

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. That's the conclusion of Senate staffers and independent reports from The Oregonian. The reports, released during the traditional "Hire the Handicapped" month of October, are an ironic comment.

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. (See related story.)

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.

The committee, chaired by Enzi, said the JWOD was problemmatic in its design. "Very few workers have moved out of employment covered by the Javits-Wagner-O'Day Act and into competitive employment," said the report released by the committee. "While competitive employment may not be an option for all those with disabilities, the Javits-Wagner-O'Day Act was not designed to help them make informed choices or to help them build the skills they might need to make such a transition."

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.

In September, the National Federation of the Blind filed suit over the Randolph-Sheppard program's poor performance. "The suit alleges that the Dept. of Education fails to administer Randolph-Sheppard as required by law," said the Committee report. "It is clear that the Department of Education's stewardship of Randolph-Sheppard programs has been ineffective." The report noted that there had been a 25 percent drop in the number of licensed blind vendors over the past 30 years and that less than 5 percent of persons hired in the Randolph-Sheppard program are blind. "Thousands of employees are ultimately hired by the vendor or subcontractor but very few of these hires are blind persons," said the report.

"Many opportunities have been lost," it continued. "Many government office buildings contain large food courts, but the committee found "none that provide opportunities to licensed blind vendors."

"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.

Read the press release "Investigation Finds Billions Wasted on Programs Congress Intended to Promote Jobs for Blind, Disabled Individuals" (Senate Health, Education, Labor and Pensions Committee)

Read the Committee Report

"Senator says programs boost CEOs, not disabled" (The Oregonian)

I am not authorized by my agency to do PR, but this article gives a very one sided view of the NISH program. At the agency where I work, NISH contraact workers make $13 to $15 per hour and have excellent medical benefits.
We do have a few sheltered workshop participants who work on the HISH contracts also. Their work is time studied and is closer to the $9 mentioned in the article. But, the agency provides transportation to and from the worksite and a nondisabled supervisor.
These participants would make less at a community job and not have transportation, which in our community is very inadequate.

THANK YOU, for giving attention to this serious problem. I made the mistake of turning to Wisconsin's Dept. Vocational Rehabilitation, and was sent to one of those "sheltered workshops" on a supposed "month long skills assessment". I was misinformed (by DVR) about the impact of earnings on benefits, and wasn't told about the "trial work period", after which most of my earnings were cut from benefits. I wasn't told that if I stopped working, it would be several months before full benefits were restored, and the earnings-reduced benefits alone wouldn't be enough to provide for myself and my daughter: if I quit, I was told, my income (the earnings-reduced benefits) would be so low that the state
could take "indefinite custody" of my daughter, on the grounds that I "failed to adequately provide". This kept me effectively locked into the job, earning anywhere from $1.50 per hour to $3.50---and then having most of that cut from benefits! I was trapped in that situation for years, until my daughter turned 18 and moved on to college (thanks to the scholarships she earned).
A note about "piece work": Even there, these sheltered workshops exploit the disabled. I had an opportunity to look at the foreman's "rate book", in which each worker's rate was supposed to be recorded. This shouldn't have been difficult, since the machines we used recorded each worker's rate. I kept track of my opwn rate, comparing it with the foreman's book, for several weeks, and saw that only a fraction of our actual rates were recorded. So---if you went
according to the rate book, it would say that (for example) 6,000 items were completed. Yet the company would get paid for the actual 24,000 items completed.
Of course, DVR profits from funneling people into these dead-end traps (i.e., sheltered workshops). I naively jumped at the offer of "skills training". The workshop receives tax payer funds to provide this. When I asked (the workshop) about this promised skills training, I was informed that this simply means, "Teaching people to come to work every day." This workshop received thousands of tax dollars on my behalf simply for telling me to show up for the job! I have also found that our representatives in government are very unconcerned about violations of workers' protections for those in those "sheltered workshops".
That's only the tip of the iceberg of my hellish experience. As long as out legislators refuse to review the many complaints about these places, I don't see a solution.

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