Central Illinois Goodwill Will Now Graciously Let Disabled Employees Work For Free
By January of 2020, the minimum wage in Illinois will go from $8.25 to $9.25. By July of 2020, it will be $10, and go up a dollar every year from there, until it hits $15 in 2025.
Everyone I know here is very happy about this. Hooray for hardworking people making more money, we say! One would also think that non-profit organizations that often work with the poor would be more excited than anyone about this, and probably most of those organizations are. The regional president of Land of Lincoln Goodwill in central Illinois, however, feels less than good about it.
She feels so not good about it, in fact, that she went and told dozens of disabled workers in her region that they would no longer be receiving paychecks. This leaves only 11 — all of whom were told that their paychecks were on the line as well.
"As of January 1, 2020, a new minimum wage law takes effect which will increase our payroll cost significantly," [President and Chief Executive Officer at Land of Lincoln Goodwill Sharon] Durbin's letter reads. "Over the next five years, the added expense will exceed two million dollars if we do not make changes."
"That means that many of our clients will no longer be working to receive a paycheck, but will be involved in some type of learning based initiative," she wrote.
Many of these employees are not even paid the minimum wage to begin with. They are losing their paychecks because Goodwill says it cannot afford to pay their other employees the new minimum wage. They will still be able to "work" for Goodwill, but they will no longer be making any money while doing so. Oh gosh, what does that sound like? It sounds like something, but I just cannot put my finger on what it is.
Goodwill takes advantage of an exemption under section 14(c) of the Fair Labor Standards Act that allows them to pay disabled workers less than minimum wage. Under this exemption, which has recently been made illegal in New Hampshire, Maryland, and Alaska, workers are paid based on "productivity," meaning that they could be paid around 22 cents per hour. As you can imagine, this is pretty controversial, with groups like the National Federation of the Blind calling it "unfair, discriminatory, and immoral" and urging a boycott of the stores because of this, and Goodwill and some other disability groups claiming that this is a way to help people who would be otherwise unemployable.
Alas, the entire point of Goodwill as a charity is that they provide job training and employment for people with disabilities and people who otherwise have difficulty obtaining a job. That is what the money we spend at Goodwill is supposed to go towards. That is why they get grants from the state:
Keeping disabled workers on the payroll also helps Goodwill qualify for state janitorial contracts. In 2018, the state awarded the nonprofit $384,953 in grants and contracts specifically set aside for a "person with severe disabilities."
But Durbin, who herself makes $164,849, plus $6,145 in benefits, says that giving these people a paycheck for the work they do was really just a very gracious thing they were doing out of the kindness of their hearts. How giving!
"It really was not a job," she said. "It was a work component and through it we gave them through grace out of our budget to pay them so they had a paycheck to go home with."
It seems like if a profit is being created off of someone else's labor, it's probably a job. And if Goodwill isn't supplying these jobs to people, what, exactly, is the difference between them and Buffalo Exchange?
Durbin claims that the new minimum wage is going to kill jobs all over the state and has been encouraging Gov. J.B. Pritzger to stop it from going into effect:
"It is going to impact us all," she said. "Gas prices are going to rise, grocery prices are going to rise. Jobs are going to be lost. Look at your Wal-Mart, your Meijers, your Schnucks. They are doing away with real people checking you out and they are doing more to go in the line of automation. Why is that? Because they don't want — or can't afford in their business model — to start paying everyone who walks in the door $15 an hour. They can't. So what are they going to do? They start eliminating jobs, because that is the first line of defense."
Durbin called on Pritzker to use his executive authority to halt the roll out of the minimum wage floor.
"The governor can make anything happen," she said. "If he's a governor – which I hope he is — that truly is listening to the people that he serves, because he is a servant, then he will stop and say, 'Wait a minute, I did not realize I was doing this to people with disabilities, and I didn't realize it was going to cripple our businesses out there.'"
First of all, if inflation increases at the same rate it has been for the last six years, the actual increase in 2025 will be the equivalent of $13.24 today. Because of inflation, they are also currently paying their workers over a dollar less an hour than they were when the $8.25 minimum wage was enacted in 2010. Had the minimum wage kept up with inflation over the years since the increase, the minimum wage would be $9.69. Had the federal minimum wage kept up with inflation since 1968, would be $11.78. If the minimum wage had kept pace with the growth in the American economy, it would be $21.16 per hour. Companies that pay the minimum wage have been, technically, saving a whole lot of money over the years, thanks to inflation and other factors.
Second of all, research shows that this is bullshit. Minimum wage increases do not lead to job losses. If anything, this increase will be a boon for Goodwill, because people will have more money to spend there.
Durbin sounds like she should be sitting on a Trump labor advisory board. If he hasn't dismantled them all already.
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Robyn Pennacchia is a brilliant, fabulously talented and visually stunning angel of a human being, who shrugged off what she is pretty sure would have been a Tony Award-winning career in musical theater in order to write about stuff on the internet. Follow her on Twitter at @RobynElyse