By Laurie Nooren, SPHR, PHRca, SHRM-CP
Effective January 1, 2025, California has made a significant stride towards equal pay for all workers by eliminating the practice of paying disabled workers a lower minimum wage than other employees. With this change, the state ensures that all employees, regardless of disability, must receive at least the California minimum wage, which is $16.50 per hour in 2025. This means that there will no longer be a separate “disability minimum wage” or “subminimum wage,” and disabled workers will now enjoy the same minimum wage protections as their non-disabled counterparts.
Current federal law allows employers, who obtain special certificates, to pay employees with disabilities an amount lower than the federal minimum wage, to incentivize employers to hire disabled employees who might otherwise not have been hired. While the DOL recently proposed these certificates be “phased out” over the next three years, a final decision has not yet been made on the federal level.
Here in the Golden State, however, California did repeal their previous law (Labor Code Sections 1191 and 1191.5) effective January 1, 2025, prohibiting employers to pay an amount less than the state minimum wage to workers with a physical or mental disability. As we move forward, it is crucial for employers to adapt their payroll practices to comply with the updated minimum wage requirements.