On May 1, 2025, Georgia Governor Brian Kemp signed the Dignity and Pay Act (the Act). The Act, which takes effect on July 1, 2025, prohibits the previously lawful practice of paying individuals with disabilities less than minimum wage in certain circumstances.
Previously, Georgia law permitted the Georgia Commissioner of Labor to grant employers an exemption to pay “certain classes of persons…at rates below the minimum rate because of overriding considerations of public policy to allow employment of certain persons with disabilities and others who cannot otherwise compete effectively in the labor market.” The Act repeals that law and further prohibits employers from using certificates issued under 29 U.S.C. § 214(c) by the United States Department of Labor that permit the same practice for federal minimum wage purposes for individuals “whose earning or productive capacity is impaired by age, physical or mental deficiency, or injury.”
According to the U.S. Government Accountability Office, in 2024, approximately 40,000 individuals were employed in the United States using subminimum wage certificates granted under federal law.[1] Although this practice is still permitted under federal law, Georgia joins a growing number of states that have outlawed this practice, including California, Colorado, Illinois, South Carolina, Tennessee, and Virginia.
The Act phases out subminimum wage in Georgia for individuals with disabilities, and employers who were issued a certificate by the U.S. Department of Labor on or before July 1, 2025, are still permitted to utilize such certificate to pay individuals less than the federal minimum wage until July 1, 2026. Beginning on July 1, 2026, employers using a certificate are required to pay individuals at least half of the minimum wage required under federal law until July 1, 2027. Beginning on July 1, 2027, employers are no longer permitted to use a certificate from the U.S. Department of Labor to pay less than the minimum wage under federal law.
If you have questions regarding compliance with the Act, please contact Ryan Gorman at rgorman@reedsmith.com, Kelli Church at kchurch@reedsmith.com, or the Reed Smith lawyer with whom you normally work.
[1] https://www.gao.gov/blog/some-states-are-eliminating-subminimum-wages-people-disabilities-what-does-mean-workers.