Building a Healthy Workforce May Have Risks as the EEOC Targets Employer Wellness Programs

Increasingly, companies are offering a variety of wellness incentives to their employees with the potential payoffs being savings in health care costs, decreased absenteeism, and increased productivity. Employers, however, need to ensure that their wellness programs do not run afoul of the Americans with Disabilities Act (“ADA”) or they may have to pay out.

On August 20, 2014, the U.S. Equal Employment Opportunity Commission (“EEOC”) filed suit against a Wisconsin lighting retrofit company, alleging that the company came into conflict with the ADA when it penalized an employee, and ultimately fired her, after she opted out of a purportedly voluntary wellness program.

According to the lawsuit, the employee was forced to pick up the full amount of her employee health care premiums, and later fired, after she objected to medical exams and disability-related questions as a part of the company's wellness program. The EEOC alleged that these consequences meant that the program was no longer voluntary, as required by the ADA.

An employer may conduct disability-related inquiries and require medical examinations as part of a voluntary wellness program without violating the ADA, but the ADA limits when an employer may obtain medical information from employees. A wellness program is voluntary only if employees are not required to participate and they are not penalized if they choose not to do so.

The EEOC's lawsuit is the first in which the Commission has targeted a wellness program under the ADA, and it points to the difficulties of complying with the ADA, while also taking advantage of the Patient Protection and Affordable Care Act's (“PPACA”) 2013 regulations allowing for rewards or penalties for meeting certain health goals. Therefore, this latest action by the EEOC should be treated as sending an important signal to all organizations that offer wellness programs to their employees.

For advice on ways you can ensure your wellness program is compliant with the ADA, as well as other federal laws, including the PPACA, the Genetic Information Nondiscrimination Act of 2008 (“GINA”), and the Consolidated Omnibus Reconciliation Act of 1985 (“COBRA”), contact your Elarbee Thompson lawyer or reply to this email.