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March 27, 2015

Sheltered Workshops

Last March I wrote about sheltered workshops.  This week we have had an opinion piece in The Globe and Mail about the closure and reopening of such an establishment in Ottawa and a thoughtful response from Jen Power of l'Arche.  I had started to assemble some data last September, but got sidetracked waiting for other info.  But here's what I learned (all data is from 2013 CRA returns):

In Nova Scotia there are 29 such agencies, supported by the Department of Community Services, associated as New Directions.  I haven't located 2 of the 29 Canada Revenue returns - Green Door and L'Atelier De Clare, so my numbers represent 27 agencies.

In 2013, they received $23.7 million from the province, 57% of revenues.

I was interested in the way the revenue stream is structured and the amounts regular employees (not the workshop participants, but their supervisors) are paid.

So on average, 20.1% of revenue comes from selling the products of the workshop.  I guess it's no surprise that salaries make up two thirds of expenses.

As far as I can determine, the figures for salaries do not include any compensation for workshop participants - 'clients' as they are called.  If they are paid at all, they receive a per diem from Community Services that is not part of the expense stream for the workshop.  'Other Expenses' are business related - rent, travel, office supplies, advertising, utilities and the like.

As an example, Flowercart in New Minas has $2,766,953 in expenses, of which $2,442,531 is salaries for 27 full time and 6 part time employees. This roughly agrees with the 23 employees enumerated on their website.  Meanwhile, 200 or so 'clients' generate $1,604,537 in goods which are sold, and the raw materials cost $97,381, yielding a profit of $1,507,156.  None of the profit goes to the workers, but it pays 61.7% of the regular employees' salaries.  Just who is working for whom?

On its Social Snapshot page, Flowercart shows the somewhat ambiguously worded Wages paid to clients hired by The Flower Cart of $1,001,480.  If, somehow, this is part of the CRA total expenditure on compensation, it would mean the average salary of the 27 full-time employees is reduced accordingly and 'clients' do get some compensation.  There just isn't enough information to make sense of this figure.

When I wrote last March, I focused on the fact that workshops are exempt from Nova Scotia's minimum wage, I had a very interesting exchange with a couple of parents of participants, who defended the practice on the basis that the operations couldn't exist if they paid minimum wage.  The most telling comment was:
I believe that our workshop still does packaging and assembly work for (a local company). I have no idea what the compensation is, but the productivity of the clients far surpasses that of the regular employees at (the local company).
I've seen some articles which indicate that while it may take four or five steps to train a regular employee for repetitive, tedious jobs, it takes a dozen or so steps to train people with the types of challenges that the clients have. However, after training, the challenged individuals are far more productive and able to tolerate the repetitive nature of the tasks.
I left it there, but the obvious problem is that very capable employees receive nothing for their labor and somehow are kept from trying their skills in the workplace.

In 2008 DCS did a review of 38 agencies operating sheltered workshops (some apparently not New Directions members).  They profiled participants:
The 38 agencies reviewed (includes Adult Service Centres and residential day program providers) provide services to 2,151 participants across the province. Of these:
  • ƒ 83 percent have a primary diagnosis of intellectual disability; 
  • ƒ 41 percent have a diagnosis of mental illness; 
  • ƒ 27 percent have mobility issues and 13 percent have visual challenges; 
  • ƒ 16 percent require 1-1 assistance to eat; 14 percent require 1-1 assistance for toilet use; and 23 percent require 1-1 assistance to take required medications during the day; 
  • ƒ 32 percent of the individuals currently receiving service reside with family members, including aging parents, while 51 percent reside in a residential program funded by the Department of Community Services. The remaining 17 percent reside in various independent situations. 
There is no corresponding data for 2014, though, based on per participant funding, I would guess the number of participants is now closer to 3000.

Some comments:


How is it that highly productive workers - "but the productivity of the clients far surpasses that of the regular employees at (the local company)" are not employees of the local company, receiving benefits and the fruits of their labor?  Why should it be their responsibility to augment the productivity of less capable workers?

When you go to Wal-Mart you meet good employees and bad.  The province has said they all must be paid at least minimum wage.  But not at community workshops.  Confusion about whether individuals with differences are objects of pity or real people pervades the culture, and this issue of fundamental fairness will come to define us.  We need to think it through.


We confuse work, which is mere calorie burning, with it's purpose, which is self-determination.  We say we like work, but what we really mean is that we value independence and relying on ourselves. When Laurie Larson, president of the Canadian Association for Community Living says people with disabilities deserve “real jobs for real pay,” she means they are entitled, wherever possible, to independence.


What are the incentives for moving participants into work?  Agencies receive 20% of revenue from the labor of their clients. (On CRA returns this is Total revenue from sale of goods and services (except to any level of government in Canada) minus Purchased supplies and assets).  Moving the best workers out would jeopardize an important source of income.

As they say in the 2008 report:
Many of the staff we met during the review offered examples of persons with disabilities who became top performers within the work area, and who, when given the choice of leaving that environment for a position within the community, chose to return to the environment. This is not to say that the opportunity of employment in the competitive labor force should not be offered as an option. It does, however, suggest that informed choice is a key to the success. 
This sounds reasonable, but leaving this decision in the hands of those who stand to benefit opens agencies to questions.  It's the worst possible optics.  With two-thirds of expenses going to salaries of administrators, and funding doubtless tied to participant numbers, motives can be confused.


Although the provincial government has a workforce diversity policy (which includes people with disabilities), they countenance and support operations that are uniformly made up of disabled people, most of them intellectually.  How is it that herding people with disabilities into a room together fosters workplace diversity?  Community integration?  Independence?  You can argue the merits of the policy, but you can't argue that the government violates it.


To make this work, we must be unambiguous about what we do.
  • End the exceptions for minimum wage.
    • Carefully distinguish between work and euphemisms like 'work activity'.  People in adult day care programs don't need to be paid.  Workers do.
  • Make funding contingent on successful training and placement into the diverse workforce.
  • Remove administrators from decisions about placement.
  • At the very least, put the full value of uncompensated labor into an RDSP, so workers have some future certainty
  • Unless there is reform from within, these peculiar institutions will be simply swept away for their injustices.  The good will be tossed out with the bad and the losers will again be people with disabilities.  


Here is a map of locations of New Directions Participants, showing the average full time salary of paid supervisory staff (2013):

and here is something to compare them:

And for the truly interested, source data to play with:

As always, comments are eagerly sought.  wcreedh@gmail.com.

1 comment:

Gus Reed said...

A friend of JMcGS says:
Good question!
I know some of the philosophy is to keep the workers capable of receiving disability pensions, which come with better benefits than working for minimum wage (medications are covered, etc, etc). I know lots of able-bodied folks who can't make it on minimum wage, which is what the folks in this program would likely be paid.
Still, one wonders if there is a better way.
And yes, how much are the supervisors being paid? Is it reasonable given the responsibilities?
As someone on disability for MS, who can't work at all for fear of losing my disability payments, I don't know what the solution is...