Goodwill's Charity Racket

[PurplePuppy]

I wouldn't give them a single thing anymore; I'd rather give my unwanted clothing to my church's mission closet!

Goodwill's Charity Racket: CEOs Earn Top-Dollar, Workers Paid Less Than Minimum Wage

Tea Party , Cliff Stearns , Corporate Greed , Goodwill Wages , John Kline , Corporations , Impact , Disabled , Goodwill , Goodwill Industries , Goodwill Industries International , Worker's Rights , Workers , Politics News

An American multi-national corporation, which accepts millions of dollars in government funds, pays its top executives more than half a million dollars per year in total compensation, while simultaneously paying some of its employees less than the federal minimum wage.

Some employees earn just 22 cents per hour.

And the entire racket is perfectly legal thanks to a Depression-era loophole in federal labor law. Is now a good time to mention that this corporation also doesn't pay any taxes?

"Goodwill Industries is one of the most well-known charitable organizations in the United States, but most members of the general public are unaware that Goodwill exploits people with disabilities," said Dr. Marc Maurer, President of the National Federation of the Blind, which has organized a nationwide protest of offending Goodwill organizations. "We are conducting informational protests to make the public aware of this practice that, although sadly still legal, is unfair, discriminatory, and immoral."

That the workers are people with disabilities only serves to make this labor exploitation worse. Individuals that are most in need of legal protection from employment abuse are being mistreated by a nonprofit organization that claims its mission is to serve the disabled and disadvantaged.

Under Section 14 (c) of the Fair Labor Standards Act of 1938, employers can apply for a special wage certificate that allows them to hire people with disabilities at a subminimum wage. Nationally, more than 300,000 workers are subjected to the law. Goodwill uses the special minimum wage exemption to take advantage of 7,300 of its 105,000 employees.

Brad Turner-Little, Director of Mission Strategy at Goodwill International, Inc., defended the practice as one of Goodwill's "tools" to help the disabled.

"With 80 percent of working age adults with disabilities in our country not participating in the workforce currently, we believe that it's important to explore more types of opportunities," Turner-Little told me. "The special minimum wage certificate is a tool to create employment for people with disabilities. It's not the only tool."

Goodwill has repeatedly said, "Without the law, many people with disabilities could lose their jobs." The nonprofit emphasizes that these are "employees whose disability significantly impairs their productivity." Why are the disabled singled out with the most rigid productivity assessments? After all, the federal minimum wage protections that you and I receive aren't tied to our productivity.

"Subminimum wage, as enforced by Section 14(c) of the Fair Labor Standards Act of 1938, is wrong because it creates a double standard for how employees, particularly employees with disabilities, should be paid, by offering 'special wage certificates,'" points out Andy Voss, president of the Autistic Self Advocacy Network of Sacramento, which organized a protest outside of a Sacramento Goodwill store in August (pictured below). "It is appalling that organizations that purport to assist workers with disabilities in job training, would hold them back by circumventing the standard of living that minimum wage provides other American workers."


Of course, the very premise is wrong. Disabled people aren't inherently less productive employees. Samuel R. Bagenstos, a professor of law at the University of Michigan Law School and a former deputy attorney general for civil rights, has written "The Case Against the Section 14(c) Subminimum Wage Program." He cites examples of how workshop employers automatically assigned jobs "without any connection to the abilities and background of the individuals." One college educated woman with cerebral palsy was paid three dollars per week to assemble rubber mats, according to a former federal rehabilitation commissioner cited by Bagenstos.

If people with disabilities are well-qualified and productive employees, why continue the policy?

Short answer: Corporate greed.

Last year, a former Goodwill executive was sentenced to 70 months in prison for embezzling $1million from MERS/Missouri Goodwill Industries Inc., according to the St. Louis Post-Dispatch. In California, smaller charities, such as D.A.R.E. America, say that Goodwill has acted like a nonprofit bully and is currently using powerful lobbyists to shut down their clothing donation programs.

In 2010, Goodwill Industries International, Inc., the national parent corporation for all of the nation's secondhand clothing affiliates, paid its president and CEO James Gibbons more than half a million dollars in compensation. And dozens of state and local chapters copied the national headquarters' executive extravagance. Here's a rundown of the recent executive compensation packages for the three Florida-based Goodwill organizations that pay some employees less than minimum wage:
$440,197- CEO of Goodwill Industries-Suncoast, Inc.

$316,685- CEO of Goodwill Industries of South Florida, Inc.

$393,001- CEO of Goodwill Industries of Central Florida, Inc.
In California, these five Goodwill organizations exploit the special minimum wage exemption and pay executives top-dollar. A short sample of some executive compensation packages over the past few years:
$282,295- CEO of Goodwill Industries of San Diego County

$265,388- CEO of Goodwill Industries of Orange County

$376,317- CEO of Goodwill Industries of Sacramento Valley & Northern Nevada

$507,898- CEO of Goodwill of Southern California

$344,754- CEO of Goodwill Industries of Santa Clara County/ Silicon Valley
Tommy A. Moore, Jr., Goodwill Industries International's board chair Goodwill's board chair, says, "The board goes through a rigorous process to determine his compensation based on the impact of his leadership, strategic goals and performance."

But, what he doesn't tell you is that the CEO's annual review is less rigorous than the corporation's review of subminimum wage employees, who are evaluated every six months, or sometimes even more frequently. Turner-Little, a spokesman for Goodwill Industries International, Inc., described to me the "lengthy" and "extensive" process.

"It's a fairly lengthy process," he explained of the subminimum wage employee review process. "Every six months, an individual who is paid under a special wage certificate, their productivity has to be assessed at least every six months. Often times employers will do it more frequently than that. And all that has to be documented and made available to the Department (of Labor) if they need to see it."

The employee evaluations are just one component of a lengthy administrative process required by the Department of Labor in order for an organization to maintain its minimum wage exemption.

According to the Goodwill national spokesman: "In order to receive a Special Minimum Wage Certificate from the Department of Labor, a business has to go through an application process, which is fairly extensive, identifying the types of jobs that the special minimum wage certificate will be applied to, provide evidence of having surveyed local companies to determine what the prevailing wage rate is for the specify jobs that are being performed so that accurate computation of the commensurate wage rate can be determined."

After Goodwill has surveyed at least three companies for comparable wage information data, the organization must evaluate individual employees.

"They have to outline their individual productivity assessment process for the jobs that are going to be paid under the special minimum wage certificate and that has to be done both for service type jobs as well as piece rate work- so hand assembly type work, making a product as well as providing a service," Turner-Little said. "Then, (they) have to outline what their time-study process is going to be, all of that is contained in the application process."

Work center certificates, the type Goodwill says it uses, can only remain in effect for two years. Then, the process starts over again, but not without adding all the previous data to the new Department of Labor application.

"Prior to the certificate running out, then they have to go through a reapplication process, with all of that information again, as well as all the data. If they have had the certificate in the past, the use of that certificate, the number of employees, the types of jobs that were performed, and provide evidence to the department that they have implemented the certificate in compliance with expected regulations," Turner-Little said.

Which begs the question, why is Goodwill spending so much time and money on this bureaucratic nightmare? Remember, Goodwill claims that the sub-minimum wage policy helps them save money and hire more workers.

So, what's being done to correct this injustice?

Rep. Cliff Stearns, R-Florida, has introduced H.R. 3086, the Fair Wages Act, to stop the practice, which he calls "deplorable and wrong." But, Stearns' office says that the bill is stalled in the House Education and the Workforce Committee, chaired by Rep. John Kline, R-Minn.

"If a hearing is not scheduled early this fall, the measure will likely be re-introduced in the new Congress," Stearns wrote to me via email. And if that happens, Stearns won't be around to help. Last month, the 12-term Congressman was defeated in the Republican primary by a Tea Party challenger.

www.huffingtonpost.com/john-hrabe/the-worst-corporation-in-_b_1876905.html

[kathyincolorado]

Hi! I think this is so sad. I will make sure that I go to St. Paw's next time. Only trouble is, her hours can be strange and I have had a pretty full plate lately. I also have a Salvation Army close to where I live, I will go there the next time I clean out my closet. Hope all is well. Kathy

[PrisonerOfHope]

I'd sooner throw things out than give it to those scammers!  I won't shop there either - I'm not going to line the pockets of greedy people who have no regard for the disadvantaged.  Do they think the disabled need hardly any money to live on, while they themselves have lives of luxury?   My best clothing goes to the church, and I used to give everything else to a local thrift shop that helps animals.  Unfortunately they closed down, so now I take things to the Salvation Army - the head of that organization makes very little money.  In fact, the lovely Christian woman who ran my old favorite thrift shop was telling me she used to work for Goodwill, and in her words, "They don't help anybody!"  

[maybetoday]

[PurplePuppy]

Has Goodwill Become Too Greedy?

The truth about what the organization does with its $5.7 billion in revenue.



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BY MARIA CARTER

FEB 28, 2018


Whenever this site posts an article about Goodwill—covering a new store concept, for example, or sharing how to mail in donations for free—there are always a handful of readers who respond with comments like, “Goodwill does absolutely no charitable giving,” and “It is owned and operated by a billionaire who’s getting free inventory,” or, “Goodwill keeps getting greedier, but employees see very little of the revenue.”



It’s obviously a hot-button issue, which got us thinking: How many of the above accusations, if any, are true?



The criticisms likely stem from a chain email that began circulating in 2005 and later became a widely shared graphic titled, “Think Before You Donate.” Its message, according to Snopes, urged people not to donate to several organizations including Goodwill, stating, “CEO and owner Mark Curran profits $2.3 million a year. Goodwill is a very catchy name for his business. You donate to his business and then he sells the items for profit.”


Founded in 1902, Goodwill Industries International is, in fact, a nonprofit organization, and the money its thrift stores make goes towards community programs like job training, placement services, and classes for people who have disabilities or are otherwise challenged in finding traditional employment.



The statement that Goodwill’s CEO and owner makes millions each year is categorically false, says Brad Turner-Little, senior director of strategy for Goodwill Industries, because there isn’t one single owner.



“Goodwill organizations are locally controlled and operated, and each of those 165 organizations in North America is an independent nonprofit that has a board of directors comprised of volunteers from that community,” Turner-Little tells CountryLiving.com. “The board hires an executive director or CEO to operate Goodwill in their territory—so it’s really owned by the community. They’re all autonomous, independent nonprofit organizations.”



"GOODWILL ORGANIZATIONS ARE LOCALLY CONTROLLED AND OPERATED—THEY'RE REALLY OWNED BY THE COMMUNITY."





Goodwill Omaha CEO Frank McGree was fired in 2016 after a World-Herald investigation revealed that he received between $400,000 and $930,000 annually, while more than 100 workers at his stores made less than minimum wage. (Paying employees pennies per hour, by the way, is perfectly legal thanks to a loophole in the Fair Labor Standards Act—something we’ll come back to shortly.)



Likewise, a 2013 Watchdog report found that the married couple in charge of Goodwill Industries of Eastern North Carolina, Dennis and Linda McLain, received close to $800,000 annually while employing workers with disabilities who were paid less than minimum wage.



And what about the president and CEO of Goodwill Industries International, whose name is not Mark Curran, but Jim Gibbons—is he a billionaire, as one of our readers alleged?



While there’s no easy way to confirm Gibbons’s exact net worth, the organization does report his annual salary. Based on those reports, Gibbons has earned more than $700,000 a year since taking the job in 2008. Disregarding what he paid in taxes with that income, and any assets he had before reaching this paygrade, $700,000 times 10 is $7 million. It would take more than 100 times that amount to reach billionaire status (reminder: one billion = 1,000 million), making it extremely unlikely that Gibbons is a billionaire.


The organization itself, however, does generate billions. In 2016, Goodwill Industries International made $5.7 billion in revenue, landing at no. 14 among Forbes’ top 100 U.S. charities. Of that, $77.5 million came from government and privately funded grants. The vast majority of revenue came from the sale of secondhand clothing and home goods, priced at what some call “greedy” rates comparable to what you’d pay new at, for example, Walmart.



“The pricing structure in stores and outlets is determined by local Goodwill organizations around what will be competitive in their particular market,” says Turner-Little, adding that greater revenue means more money to reinvest in services for area residents.



"GOODWILL'S CEO IS A BLIND PERSON MAKING HALF A MILLION OR MORE WHILE OTHER BLIND EMPLOYEES EARN LESS THAN MINIMUM WAGE. THERE'S OBVIOUS IRONY IN THAT."



Those services include career training workshops, financial wellnesses services, and, in some communities, mentorship programs for at-risk youth and transitional housing support. In 2016, more than 35 million people used the nonprofit’s in-person and online services to further their careers or manage their money.



The accusation that Goodwill’s employees see very little of its profit likely comes from periodic public uproar over the fact that some stores pay workers with disabilities less than minimum wage. A provision to the Fair Labor Standards Act created in 1938 allows companies to employ certain individuals, including full-time students, who might otherwise be excluded from the workforce, for “subminimum” wages.


In 2012, the National Federation of the Blind (NFB) called for a boycott of Goodwill organizations that take advantage of the Special Minimum Wage Certificate, as it’s called. To be fair, Goodwill is far from the only charity taking advantage of the special certificates: The most recent data from Department of Labor, from October 2017, shows there are 1,775 employers nationwide with special minimum wage certificates, employing more than 160,000 people with significant disabilities.



Chris Danielsen, director of public relations for NFB, says his organization singled out Goodwill in particular for specific reasons. “When you have an entity that is as well-known as Goodwill, and is bringing in the amount of money that it is—the argument often made by subminimum wage employers is ‘We couldn’t afford to give jobs to workers with disabilities if we paid them minimum wage’ and that clearly is not the case with a lot of these entities,” he says.



“Goodwill Industries CEO, Jim Gibbons, is a blind person,” Danielsen adds. “He is drawing a salary of half a million or more while there are other blind employees earning less than minimum wage. There’s obvious irony in that.”



Brad Turner-Little with Goodwill Industries says his office is a membership association with no control over such discrepancies. “Those decisions around employee compensation are driven, governed, and controlled by local Goodwill organizations,” he says.



Currently, out of Goodwill’s 156 organizations in the U.S., 44 hold certificates that allow them to pay some workers less than minimum wage. For customers who are unhappy with their local store’s use of such certificates, Turner-Little says it’s up to community members to create change.



“From an action perspective, you can work with Goodwill and other organizations in your area to build infrastructure that will help workers with disabilities engage in the local labor market,” he says. “That may mean providing or expanding on existing public transportation, especially in rural communities, or making sure employers have the support they need to fully integrate workers with disabilities, some of whom have certain needs on the job.”



Danielsen points to data that shows that less than 5 percent of workers with disabilities making below minimum wage will successfully transition into competitive integrated work.



Last March, Congressman Gregg Harper (R-MS 3rd District) introduced a bill that would phase out the practice of paying subminimum wages. It was referred to the House Committee on Education and the Workforce but hasn’t been voted on. The TIME Act, as it’s known, is an official part of both the Republican and Democratic party platforms, according to NFB.



The state of Maryland, where the NFB is headquartered, recently passed a law to phase out subminimum wage by 2020. Vermont and New Hampshire have similarly outlawed the practice, and Danielsen is hopeful more states will soon follow suit. “There is considerably more momentum now toward legislative changes,” he says.

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[maybetoday]

Illinois Goodwill pulls paychecks from disabled workers

WROC Staff

1 day ago




SPRINGFIELD, Ill. (WCIA) — An iconic nonprofit thrift store is crying poor in the face of looming payroll increases, and it is announcing plans to layoff disabled employees in order to take on the extra cost.



However, the 501(c)(3) organization pays no taxes, collects state funding, was awarded state contracts, and has special permission from the federal government to pay disabled workers well below the minimum wage floor.



Sharon Durbin, President and Chief Executive Officer at Land of Lincoln Goodwill, told dozens of disabled thrift store workers they would no longer receive a paycheck as a result of the state’s new minimum wage increase, and she warns future job cuts could still be coming to the last 11 remaining disabled employees still on the payroll.



Durbin runs the Central Illinois nonprofit branch that oversees 15 retail locations and more than 450 total employees. She wrote about “upcoming changes to the Vocational Rehabilitation Program” in a letter dated June 14th. Her letter said the program “is funded through the Illinois Department of Human Services,” but the funding “does not cover all of the significant costs of the program.”



The abrupt shift not only comes as disappointing news to dozens of disabled workers in the area, including some who live in group homes without their parents, but it also threatens to weaken the core promise of Goodwill’s mission statement.



Inside one of Springfield’s retail locations, a massive wall painting says, “DONATE STUFF. CREATE JOBS.” The loud speaker broadcasts a message that reminds shoppers, “At Goodwill, every item you buy, and every item you donate funds job training and so much more.” Literature hanging in the lobby announces that “we train and support over 1,000 people with developmental disabilities.”



The state legislature awarded a 3.5% funding increase in the current state budget to help fund the job trainers and skills coaches who work with the disabled employees.



In previous years, lawmakers required the entire increase in state funding to go toward staff raises. This year, the non-profit vendors were allowed discretion to use the increase however they see fit. But the thrift shop organization said it had not yet awarded pay raises to staff, and that the extra funding was not enough to offset a higher payroll burden due to the pending minimum wage increase.



“As of January 1, 2020, a new minimum wage law takes effect which will increase our payroll cost significantly,” Durbin’s letter reads. “Over the next five years, the added expense will exceed two million dollars if we do not make changes.”



“That means that many of our clients will no longer be working to receive a paycheck, but will be involved in some type of learning based initiative,” she wrote.



Loni Braun, whose 28-year-old autistic son Nick worked for Goodwill location on Wabash Street, called the non-profit’s decision “an atrocity.”



“My son has worked for Goodwill for six years,” she said. “He started at $8.25. He left at $8.25. So he has never had a raise. The minimum wage is going to go up I believe a quarter, but not until January. So they are not raising it to the $15 until the year 2025.”



Durbin’s son, Brian Durbin, was hired onto the Executive Leadership team and makes an annual salary of $95,747 at the nonprofit.



Braun says she pleaded with the thrift store to keep her son on the payroll, and wondered, “Why can’t they just say, ‘OK, can you guys just keep agreeing to work for $8 and a quarter?’”



Goodwill is certified with the U.S. Department of Labor with sub-minimum wage approval. Because they hire disabled workers, they have special permission to pay them below the minimum wage.



Durbin acknowledged that her group already pays the sub-minimum rate for 27 of 50 disabled workers, however, inexplicably, she says the nonprofit is “progressing away from that.” The federal formula requires employers to pay disabled workers based on a productivity scale at a rate commensurate with the work they complete.



“I miss doing it,” Nick said Monday. “I wish they would not have done this to me. I’ve been here for six years and never got a pay raise. We were all crying when some people left and you know, it’s really, really… I want my job back. It’s heartbreaking.”



“We are being viewed as this awful organization that is removing jobs from people with disabilities and that’s not true,” Durbin responded, claiming she holds a soft spot in her heart for disabled people like her brother.



She explained that disabled workers are not always as efficient or as productive as a traditional employee, and the extra time and labor it takes to train and correct the mistakes of the disabled workers costs more money.



“It really was not a job,” she said. “It was a work component and through it we gave them through grace out of our budget to pay them so they had a paycheck to go home with.”



Braun, who describes his experience at Goodwill as his dream job, disputed Durbin’s characterization of his abilities. He says his managers told him he was “very high functioning” and “said they wished they had ten more of me.”



“I am very proud of my work,” he said. “I would help when I was on the sales floor. I would help customers find what they were looking for. I would help them find where the active wear was, and this and that.”



As a part of the Vocational Rehabilitation Program, Goodwill sent a bus 12 miles south of the retail location in Springfield to pick Durbin up at his home in Glenarm. Because he can’t drive, he fears no other employers will accommodate his challenging transit needs.



“I thought they cared, but I guess they don’t,” he said.



Keeping disabled workers on the payroll also helps Goodwill qualify for state janitorial contracts. In 2018, the state awarded the nonprofit $384,953 in grants and contracts specifically set aside for a “person with severe disabilities.”



“They say it is to help our mission,” Braun’s mother said. “But what is the mission now? That is what we are trying to find out. They have gotten rid of most of the people with disabilities. What are they doing with all those donations?”



The organization’s 990 tax documents from 2018 reveal Durbin takes home an annual salary of $164,849 plus another $6,145 in benefits.



She warned the higher wage floor would set off a “domino effect” of jobless claims around the state.”



“It is going to impact us all,” she said. “Gas prices are going to rise, grocery prices are going to rise. Jobs are going to be lost. Look at your Wal-Mart, your Meijers, your Schnucks. They are doing away with real people checking you out and they are doing more to go in the line of automation. Why is that? Because they don’t want — or can’t afford in their business model — to start paying everyone who walks in the door $15 an hour. They can’t. So what are they going to do? They start eliminating jobs, because that is the first line of defense.”



Durbin called on Pritzker to use his executive authority to halt the roll out of the minimum wage floor.



“The governor can make anything happen,” she said. “If he’s a governor –which I hope he is — that truly is listening to the people that he serves, because he is a servant, then he will stop and say, ‘Wait a minute, I did not realize I was doing this to people with disabilities, and I didn’t realize it was going to cripple our businesses out there.’”



It’s unclear how the governor could enact such a change without prior approval from the General Assembly, which is not scheduled to return to Springfield for fall session until November.



“Governor Pritzker worked to balance the interests of workers and the business community when creating the gradual six year ramp to $15 an hour,” spokeswoman Jordan Abudayyeh said. “The governor hopes Goodwill will work with the federal government and DHS to continue offering jobs to those with disabilities.”



Goodwill officials from our region want to remind people that this incident in Illinois is independent from operations elsewhere. Mary Boland, Vice President of Communications and Community Relations for Goodwill of the Finger Lakes released a statement Tuesday:



“Each Goodwill in the United States is independently run. This situation is unfolding in Springfield, Illinois. Goodwill of the Finger Lakes pays all of our employees, including those with disabilities the New York State minimum wage or above. In the past 5 years, the NY state minimum wage has steadily increased which has resulted in an additional increase of $3.6M in wages being paid to our employees. We value every one of our employees and appreciate their hard work.



Goodwill of the Finger Lakes is a local, not-for-profit organization that serves over 100,000 people in our community each year. Our mission services help people overcome barriers to independence especially people who are blind. By shopping and donating at our local Goodwill stores, we are able help people right here in Rochester.”


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