Wage and Hour Division (WHD)

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FOH Field Operations Handbook
Chapter 64 Employment of Workers with Disabilities at Special Minimum Wages under Section 14(c)
Section 64h Concluding Activities

Section 64h02: Narrative Report Requirements for Section 14(c) Investigations

• Profile section.
1. Precede the standard four-part narrative with a work center/institution profile section, a concise summary of the activities provided to the workers with disabilities, the nature of the work program and the types of rehabilitation services offered. The profile should include the following:
   • Corporate and legal name of the employer.
   • A listing of all establishments operated by the facility.
   • Primary disabilities of the workers served by the facility.
   • Primary source of income of the employer (if possible, include as a "D" exhibit a copy of the employer's most recent financial statement).
   • The nature of any board, lodging or other facilities furnished.
   • The name and address of the president of the board of directors or appropriate corporate officials if it is a for-profit corporation.
   • The name of the executive director and length of service with the work center.
   • A brief statement of the disposition of any prior investigation.
2. For patient worker cases, also note the type of institution, whether it is for-profit or not-for-profit, public or private, and the primary disability group served. Report the total number of patients in the institution at the time of the investigation and the number of patients who are employees of the institution.
3. For investigations involving SCA or PCA, standard government contract reporting procedures shall be followed.
• Coverage section. It is important to document employees' covered status. Employees of section 14(c) certificate holders are usually covered on an individual basis. Reference the supporting documents in the coverage section of the narrative. These documents might include staff interviews reflecting that clients are engaged in interstate commerce, invoices showing goods shipped in commerce, initial conference notes including the employer's admission of coverage, or a list of major contracts on which employees work. This section should clearly describe the flow of goods in interstate commerce, identifying which employees are covered and which employees, if any, are not covered.
• Exemption section.
  1. The exemption status of staff employees should be reported here, following normal reporting requirements.
  2. Section 13(a)(7) provides an exemption for employees who are "exempted by regulations, order, or certificate of the Secretary issued under section 14." Neither the FLSA nor the certificate exempts workers who have disabilities for the work being performed from the overtime provisions of the Act.
• Status of compliance section. Discuss the investigation findings as they pertain to both workers who have disabilities for the work being performed and other employees of the firm following normal reporting requirements. In addition, discuss the following section 14(c) issues:
  1. Misclassification. If employees have been misclassified as having disabilities for the work being performed and paid a SMW discuss in the compliance section how these violations were substantiated and how back wages were computed.
  2. Commensurate wages. If the SMW paid was not commensurate, include the following in the status of compliance section:
     • An explanation of the method the facility used to derive the rate paid workers with disabilities, and why this method did not result in commensurate wages. Identify the steps taken to substantiate that commensurate wages were not paid, such as confirming time studies, a prevailing wage survey, staff interviews, and/or observations of hourly employees.
     • An explanation of the violations that resulted from the failure to pay commensurate wage rates and what the facility must do to achieve compliance.
  3. Certificate status. Reference the certificate number and date of issuance or note the absence of proper certification.
  4. Section 14(c) recordkeeping. The narrative should highlight any deficiencies in disability, productivity, and production standards records required by Regulations 29 CFR Part 525.16. Copies of time studies, prevailing wage surveys, and other documents substantiating either compliance or noncompliance should be incorporated into the case file and referenced in the narrative by exhibit number. Discuss here any violations regarding failure to inform workers of terms of the certificate and failure to display the poster.
  5. Method of computation. Clearly describe the method of BW computation. List the BW findings and the number of employees involved.
• Disposition section. Regular reporting procedures shall be followed. INVs shall relate any explanation the employer offers for the violations and describe any actions the employer has agreed to take to come into/maintain compliance. INVs will report all compliance assistance materials provided to the employer. The disposition section of the narrative should conclude with recommendations from the INV as to what further action, if any, is necessary to ensure future compliance and back wage payment. For example, the INV could recommend any of the following courses of action:
  1. Second-level conference.
  2. Referral to the SOL for litigation.
  3. Certificate revocation.
  4. CMP assessment for willful and repeat section 6/7 violations and/or child labor violations.
  5. Employee 16(b) or 14(c)(5) notification.
  6. Reinvestigation after a predetermined amount of time.
  7. Appropriate actions involving government contract violations.
• Print the narrative and WH-51 (Compliance Action Report)(the narrative report may be saved to database).