Disability impacts are eyed in miniumum wage debate

Workers with disabilities and the people who provide direct support for people with disabilities are two different sides of the […]

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Workers with disabilities and the people who provide direct support for people with disabilities are two different sides of the coin in St. Paul’s minimum wage debate. As St. Paul City Council members and Mayor Melvin Carter III push for a $15 minimum wage, the voices of the city’s disability community are being heard.

Larger public listening sessions wrapped up in September, including a public hearing before the City Council. While most attention has focused on bar and restaurant workers and whether or not there should be a tip credit, disability issues have also risen to the surface. The council heard from direct support staff members who need more pay, people with disabilities who want more pay, and disability employers who worry that a higher wage could mean that workers with disabilities could be the first ones laid off.City Council Member Chris Tolbert, whose office is drafting the ordinance, is seeking more input from the disability community before the ordinance is written. As Access Press went to press, he was planning to meet with a group of employers and workers.

The nonpartisan Citizens League wrapped up a study during the summer, producing a 446-page study. The study was led by a 21-member panel of workers, employers, union representatives and service providers. Members included Pang Yang, owner of Rainbow Health Kare, Inc., Rick Varco from SEIU Healthcare and President/CEO of ALLY People Solutions Bob Brick.

All three minimum wage plans forwarded to the City Council call for the $15 minimum wage with indexing to inflation. Another shared recommendation is for employment programs that serve people with disabilities, such as sheltered workshops. Those programs would have to apply to the city for exemptions. The key differences between the three proposals apply to tipping and to phase-in times.

The study’s executive summary stated two key points. One is that “An increase in the minimum wage affects businesses/organizations differently based on their size, industry, and respective business model.”

A second shared point is that “Implementation (including community education/outreach) and enforcement efforts are critical to the viability of and adherence to a new minimum wage ordinance.”

The committee met 14 times, hearing from a variety of speakers with different viewpoints and information on the minimum wage issue. At its last meeting in August, it was evident that there were still deep divisions and concerns centering on some issues, especially the impacts for workers who receive tips.

But there are also concerns about to pay workers with disabilities, some of whom have wages that are also impacted by federal law, Medicare and whether or not the workers benefit from publicly subsidized health care or other programs.

One issue the committee study is that of the “benefits cliff,” the point when workers lose benefits because their pay hits a certain level. Yet the new pay increase still isn’t enough to cover costs of health insurance or other needs for workers and their families.

During the summer the study committee heard from a panel that focused on day training and habilitation services and youth training programs. One wrinkle raised is that service providers outside of St. Paul could be affected if staff has to travel into St. Paul to assist clients. It could even be a factor when people with disabilities and their staff go to the capitol for the various disability group rally days, said Kevin Goodno of Fredrikson and Byron.

The bigger issue is Medicaid reimbursement that day training and habilitation and other providers depend on for their revenue. Changes would have to be made at the state level to help organizations pay a higher wage.

That change was agreed on by longtime disability rights activist Rick Cardenas, who also said he’d like to see more workers with disabilities move from contract jobs to full-time employment. He told the study group that it is ultimately up to the state to raise the pay of workers with disabilities and give more financial support to funding services for people with disabilities.

The study notes that more time is needed to consider some issues. One is that of people who occasionally work in St. Paul. That would include direct support staff who accompany their clients to appointments, personal visits or even lobbying at the state capitol. What has to be determined is the amount of work in St. Paul that would trigger coverage by a minimum wage ordinance.

The second issue is Medicaid, which the study committee didn’t feel informed enough about to make a recommendation. “Businesses that receive at least 50 percent of their funding (directly or through reimbursements) from Medicaid will be in a particularly difficult position when St. Paul implements its new minimum wage ordinance,” the study report stated.

“Medicaid funding levels are set by state and federal governments and are unlikely to rise in response to municipal minimum wage ordinances without substantial lobbying efforts. Business owners affected by this dynamic who served on the study committee did not seek an exemption to the new wage rate; such an exemption was seen as irrelevant as these businesses must pay competitive wages to attract workers who could opt for higher paying work in retail or restaurant industries, for example. Instead, these business owners sought to be included in the small business phase-in schedule to allow for as much time as possible to work with legislative bodies to increase Medicaid funding and reimbursement rates. Opponents of this option cautioned that a blanket phase-in inclusion could be problematic because it would also cover major institutions with a large workforce, such as public hospitals.”

All study group members were invited to submit comments. As a direct care employer, Yang raised concerns for her industry. “During the final voting in the study committee I asked that Medicaid funded businesses to not be excluded from the minimum wage increase. These businesses would have a difficult time trying to compete for employees if they were to be excluded. The only way for Medicaid funded businesses to be able pay the increased wage would be for the State of Minnesota to legislatively approve an increase in reimbursement rate. I am asking that the City of St. Paul give these businesses enough time to go to legislation to ask for the rate increase. For this reason, I am asking that businesses who are 100 percent Medicaid funded be included in the slower phase in schedule no matter what their business size. It is a large sum of money to ask the state for. We would need at least five years to ask for the additional funding or at least two full budget sessions.”

Brick said, “I am grateful that the study committee recognized the need to exempt a small number of individuals with intellectual and mental health disabilities who receive employment support services from providers which are licensed by the Minnesota Department of Human Services. These support services enable program participants to obtain jobs, learn and keep them, while contributing to the success of St. Paul businesses. Experience tells us that when the minimum wage increases, these individuals are among the first to lose jobs or to have work hours reduced, thus affecting their quality of life. The committee recommendation will allow them to continue earning the state minimum wage or more, while receiving licensed support services.”

But Brick raised concerns about the wage exemptions for direct support workers who accompany client to St. Paul, stating that the Minneapolis exemption isn’t clear enough. “Without a thoughtful, clear standard, support staff whom accompany people with disabilities may be covered by the ordinance, even if they accompany a non-resident with disabilities to a limited number of such activities,” he said.

Varco didn’t submit comments for the report. He was a study group co-chair.

To read the report, go to www.citizensleague.org.



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