(1) The department of corrections may do any of the following:

  (a) Construct, use, equip, and maintain buildings, machinery, boilers, and equipment that may be necessary to provide for the employment of inmate labor in the state correctional institutions for the manufacture of goods, wares, and merchandise and the operation of services.

  (b) Purchase new material to be used in the manufacture of goods, wares, and merchandise, and the operation of services.

  (c) Dispose of the manufactured products or provide services in the manner provided by law.

  (d) Continue to use and maintain the buildings, machinery, boilers, and equipment in the manufacture of goods, wares, and merchandise in the manner in the operation on April 5, 1968 and use the facilities in the operation of service programs.

  (e) Recruit and employ agents and assistants through the department of civil service as may be necessary to carry out the purposes of this act and recommend to the department of civil service classes and selection procedures that recognize the unique needs of correctional industries in this state.

  (f) Establish an advisory council for correctional industries in this state, which shall include representatives of organized labor, private industry, state government, and the general public.

  (g) Enter into any agreements necessary for assigning inmates to employment in private manufacturing or service enterprises under section 7a.

  (h) Establish a prison industry enhancement certification program under 18 USC 1761(c) and enter into any agreements necessary for assigning prisoners to employment in private manufacturing or service enterprises permitted under the prison industry enhancement certification program, including, but not limited to, the manufacturing of caskets for the burial of indigent persons. The department may purchase equipment, raw materials, supplies and other items necessary for the manufacture or production of products or services under the prison industry enhancement certification program and may contract with a private individual, corporation, partnership, or association for the manufacture of products and services under the prison industry enhancement certification program and may sell or exchange those products and goods as provided under section 6(1)(d). Prisoners participating in the prison industry enhancement certification program shall receive, in connection with any work performed, wages at a rate which is not less than that paid for work of a similar nature in the locality in which the work was performed, except that such wages may be subject to deductions which shall not, in the aggregate, exceed 80% of gross wages, and shall be limited as follows:

  (i) Taxes, including federal, state, and local taxes.

  (ii) Reasonable charges for room and board, as determined by regulations issued by the director of the department.

  (iii) Allocations for support of family pursuant to state statute, court order, or agreement by the offender.

  (iv) Contributions to any fund established by law to compensate the victims of crime in an amount that is not more than 20% but not less than 5% of gross wages.

  (i) Accept from a natural person, sole proprietorship, partnership, corporation, association, or legal entity, items that are labeled as obsolete to disassemble for sale as scrap or for disposal. The department may charge a fee for accepting items described in this subdivision and may refuse to accept any items. Other than for an institution, governmental agency, or tax-exempt organization described in section 6, materials recovered after disassembly or demanufacturing shall not be used in any form or for any purpose other than sale for scrap value or disposal. Any proceeds from a sale for scrap value shall be credited to the correctional industries revolving fund.

  (2) Prisoners participating in the prison industry enhancement certification program under subsection (1)(h) shall not be deprived of the right to participate in benefits made available by the federal or state government to other individuals on the basis of their employment. However, those prisoners shall not be qualified to receive any payments for unemployment compensation while incarcerated. Prisoners participating in the prison industry enhancement certification program shall participate in that employment voluntarily and must have agreed in advance to the specific deductions made from gross wages required under subsection (1)(h) and all other financial arrangements as a result of participation in that employment. The use of inmate labor shall not result in the displacement of employed workers within the local region in which work of the same or comparable nature is being performed.