Goodwill pays disabled workers pennies an hour

A 75-year-old labor law allows the company to subvert minimum wage. Its chief executive argues that those earning the reduced rate couldn't work otherwise.

By Jason Notte Jun 21, 2013 4:19PM
File photo of an employee working at a Goodwill in Toronto, Canada (© Steve Russell/Toronto Star via Getty Images)Is it still considered charity if Goodwill Industries only pays some of its employees 22 cents an hour? In Goodwill's view, yes: They could be making nothing.

In a payroll decision that's ideologically complex at best, Goodwill Industries outlets in Pennsylvania used a 75-year-old labor law loophole to pay disabled employees as little as 22, 38 and 41 cents per hour in 2011.

As NBC News discovered, a 1938 law known as the Special Wage Certificate Program allows charities and companies to get special certificates from the Department of Labor that permits them to pay disabled workers based on their abilities, with no minimum.

At the time, it was a means of encouraging companies to hire workers with disabilities. With Goodwill International paying chief executive Jim Gibbons $729,000 in salary and deferred compensation in 2011, that makes Goodwill's wages for disabled employees seem as cheap as the broken keyboards and old pairs of Velcro sneakers on its stores' racks.

Gibbons doesn't see it that way, however, defending Goodwill's wage program in a Huffington Post column earlier this year and addressing critics on the site again Friday.

"For young people with the most significant disabilities, the Special Minimum Wage Certificate means the difference between reaching their personal employment potential and having no job at all," he wrote.

More than 216,000 workers are eligible to earn less than minimum wage under the current law, though many end up earning the full federal minimum wage of $7.25 an hour. While it's true that the employment rate for Americans age 20-24 with disabilities is only 32%, according to the Department of Labor, that doesn't mean Goodwill's disabled employees are particularly happy with their reduced rate.

"If they really do pay the CEO of Goodwill three-quarters of a million dollars, they certainly can pay me more than they're paying," Harold Leigland, who is legally blind and hangs clothes at a Goodwill in Great Falls, Mont., for less than minimum wage, told NBC News.

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Jun 21, 2013 4:58PM

I saw this happen with non for profit workshops for the mentally disabled for years.  Some clients/workers would have to buy their lunches and have the cost deducted from their "pay" and some wound up with no take home pay or were even in debt.  Meanwhile, the administrative staff had very nice salaries and the supervisors weren't uncomfortable, either.  The idea that the disabled should be grateful for the crumbs they are thrown is just disgusting. 



Jun 21, 2013 5:18PM
i no longer donate or shop at goodwill.  CEOs and founder are ripping off the public and taking advantage of their employees.  have been for years but no one seems to be paying attention.  i did and will continue to boycott this company until they be come the truly charitable and disabled advocates they claim to be. 
Jun 21, 2013 4:56PM
The CEO of Goodwill makes more money than President Obama, more money than the Chief Justice of the U.S. Supreme Court.  There should be a law against that.
Jun 21, 2013 5:16PM
They receive their  products by donation (FREE). Which I was led to believe that the money they received would go for disabled workers who worked for GW. We donate to them and shop there also. Now we find out that it is for profit company. We have  shopped there for many years but within the past few months we have noticed that the prices are getting higher and higher. For example dishes we bought a weeks ago for $1.06 went up to $2.16 and last week they are now $3.16 each. Why does this Jim Gibbons make this salary of $729.000 and disabled people make .22 to .48 cents an  hour? This MAN should be VERY ashamed. We now hearing of this have decided to donate our items to Hospices.
Jun 21, 2013 6:08PM
I worked for the goodwill for 7 years I finely took retirement early because I couldn't take the crap anymore, they don't treat there regular workers very good either.I was a cashier, hung clothes, priced goods that came in, we had to do everything. I got a 10 cent raise once a year. The disabled worked in our store, sure they get Federal help but not that much, most of the money goes to there housing and food. I don't know what state P.A.michB lives in but Oregon, the disabled are not rich,and what little they get by working at the Goodwill maybe they could buy a pair of shoes at the goodwill. why doesn't the government do something about it? It's a real crime the CEO of goodwill makes more then the President but its been like that for years. The founder of Goodwill would turn over in his grave if he knew what they did to his company. DON'T DONATE OR SHOP AT THE GOODWILL.
Jun 21, 2013 5:20PM
Well I used to give Goodwill a lot of discards.  After reading the article, they will now go to the Salvation Army, VFW, and other organizations that don't cheat their employees.  If I find out that the others are doing the same thing, then they go to the city's recycle program.
Jun 21, 2013 5:53PM
This **** has to stop.
The CEO of Goodwill should have all of his assets seized and left homeless for the evil he's levied on the mentally disabled.
Monsters walk amongst us...and most of them make a lot of money.

Jun 21, 2013 5:51PM
I will make it a point not to buy or give to Goodwill until they really have Good Will!!
Jun 21, 2013 5:20PM
That's pure predatory greed! People who are disabled are obviously performing a service for Goodwill. They should be getting a fair wage because we all know upper mgmt. is getting their fair share......
Jun 21, 2013 6:47PM
While their CEO makes MILLIONS in compensation each year from the free donations to a suppose charity and exploit cheap labor from the most vulnerable?  What an immoral and unethical business model that borders on pure scam!
Jun 21, 2013 4:38PM
This isn't new folks. Charities and churches do this all the time. I worked for a church ministry
while in high school, 1974-1975 and made $1.85 an hour, after a raise. When I graduated from school, the job was still there but the pay never changed. Yet the minister had a private plane and had a Cadillac. His private secretary had a personal driver for her car. She had a hairdresser who came to the office in the middle of the day to do her hair. The office managers were married to each other and were certainly not paid minimum wage though not as lavishly as the higher ups. By the way, the office pool employees, myself included,  certainly weren't disabled or mentally retarded.

Jun 21, 2013 5:27PM
I don't know if the masses of people who read this remembers a couple of the scandals that were taking place within the walls of Goodwill but one of them happened to involve employees going through all the stuff that was donated to them and claiming all the good stuff for themselves before it hit the racks or shelves. I believe another issue was the amount of money they were paying themselves at the top and not the bottom.
Jun 21, 2013 7:01PM
CONGRESS, time to take away Goodwill and other charitable agencies TAX FREE STATUS!
That is all....

Jun 21, 2013 6:03PM

I don't care if the employees are receiving federal funds because in today's economy that still doesn't

amount to jack squat.  I receive widow's benefits which goes to rent, my student loan, and insurances.

I live on $7.25 an hr. for 29 hrs. a week which after taxes comes out to about $375.00 every 2 weeks which breaks down to $185.00 a week which goes to food, gas, phone and electric. I have to rely on my daughter for car repairs ( I drive a 2001 Ford) and cable. When I asked for more hrs. I was told that the co. is keepng all employees below 30 due to Obamacare. That way the co. doesn't have to pay their share of the employee's health care cost, which has increased. And all future employees will also be p/t..  And yes, I continually look for better paying jobs, in fact I'll move for one if needed. Goodwill shold o the ight thing and pay minimum wages. Where is the ACLU on this?  The media should be making a stink as much as they are with the Paula Deen story.

Jun 21, 2013 5:42PM
Out of curiousity, are they also able to pay the ex-cons a lower rate because of their inability to secure jobs as well?    I know they also use that worker base.    It's a serious question if anyone knows the answer....does a 2 time felon get minimum wage while the unforunate blind person gets $2.50?
Jun 21, 2013 9:58PM
Companies get tax deductions for hiring disabled people and they only pay them pennies, now that's pathetic.
Jun 21, 2013 7:14PM
When I have something to give away, I give it to a needy family or person...NOT GOODWILL!   I agree with '4LoveofMoney" time to take away their TAX FREE STATUS!
Jun 21, 2013 8:18PM

This is just  WRONG,  WRONG,  WRONG!  GWI should be ashamed of themselves. This is why I only donate and shop at our local second hand stores.

Jun 21, 2013 7:24PM

It is not illegal to be a scumbag. Sad but True. The problem is it is illegal to trash their place.

We need to put signs at the collection points.



Jun 21, 2013 7:04PM

absolutely despicable of them. I used to donate to them on a regular basis, not any longer I won't/

To argue that paying 22 cents is better then nothing I argue nothing is better .Those employees are better off volunteering at another charity, hospital, or a senior citizens center or for their religious communities that they are associated with. .Yes I understand that other institutions will do the same thing, knowing that , the person applying should investigate who they are going to work for on any level , and pick out the who deserves their efforts

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