New federal law requires 7% of an organization consist of people with disabilities

In mid-2014, the federal government established the rule requiring that the workforce of federal contractors consist of a minimum of seven percent of workers with disabilities. Contractors that fail to meet this stipulation could lose their contracts. “Federal contractors represent 22 percent of the American workforce and an aspirational 7 percent hiring goal means the rule will create real jobs, at all levels of seniority, for Americans with disabilities,” said Mark Perriello, president and CEO of the American Association of People with Disabilities. This change could mean over half a million jobs for people with disabilities within the first year alone, the Labor Department said last year when the rule was finalized.

There are better reasons for hiring those with disabilities than just “because you have to.” Here are four more:

• Goodwill: Employing people with disabilities improves your brand through generating goodwill, and that translates directly into money. Customers with disabilities and their families, friends, and associates represent a trillion-dollar market segment. That is bigger than the “teen” market. Wouldn’t you like to have that kind of increase in your customer base?

• Three Tax Incentives:
  1. Employers filling a job vacancy by hiring a WOTC-certified employee are eligible for the Work Opportunity Tax Credit which covers the first $6,000 in wages paid to each new hire for the first year of employment, with a maximum tax credit of up to $2,400 per new hire. Hire a disabled veteran and those figures are doubled.
  2. A Welfare-to-Work Tax Credit applies to businesses that hire individuals who have been certified by the “designated local agency” as a member of a family that received Temporary Assistance to Needy Families (TANF) or Aid to Families With Dependent Children (AFDC).  The WWTC provides a tax credit to employers of  35% for the first year and 50% for the second year of the first $10,000 in wages for each of the two years of employment or a maximum of $8,500 for individuals who work a minimum of 400 hours or 180 days per year. 
  3. Social Security Administration Employment Network Cash provisions are formula-based cash incentives contingent upon favorable employment outcomes for people with disabilities when they are able to forego their income maintenance (SSI and/or SSDI) benefits. In addition, small businesses are eligible for the annual Disabled Access Credit for making your business eligible to persons with disabilities. This can represent a maximum benefit of $5,000 annual reduction in total tax liability.

• Cost Reduction: Your instinct may be to assume, as most do, that it is expensive to make accommodations for people with disabilities in the workplace. You would be wrong. The U.S. Department of Labor’s Job Accommodations Network (JAN) annual report, “Workplace Accommodations: Low Cost, High Impact” concludes that “workplace accommodations not only are low cost, but also positively impact the workplace in many ways.” According to the report, a majority of requested workplace accommodation incurred no significant implementation cost. Examples include flexibility with work scheduling, dress code allowances, or permitting someone to sit where they would normally stand or vice versa. In fact, employers who hire people with disabilities report that providing accommodations results in higher employee retention rates, increased productivity, reduced workers’ compensation expenses, and lower training costs. These employers have also noticed lower than average absenteeism rates, and longer than average tenures. “Many employers believe that they will have to change their physical structures, every desk, every doorway … but statistics show that 15% of accommodations cost nothing and 50% of accommodations cost less than $500.” –Marian Vessels, ADA & IT Information Center for the Mid-Atlantic Region. 

Compare that to the cost of employee turnover!

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