Wellness Plans – No Good Deed Goes Unpunished?

Randi Klein Hyatt
Randi Klein Hyatt
09/05/2014

Wellness plans have been around for quite some time, and in varying forms.  Employers are, more often and with regularity, implementing some category of wellness plan for multiple reasons: healthier workforce, better attendance and productivity, higher morale, lower health insurance costs, and the like. Indeed, the Affordable Care Act permits employers to offer financial incentives to employees to encourage participation in these programs.

The increase in wellness programs naturally extends into the legal employment world as well.  In January 2013, the Equal Employment Opportunity Commission (EEOC) advised that medical inquiries and exams connected to voluntary wellness programs are permissible under the ADA (voluntary meaning that the employer does not require participation nor penalize employees who do not participate). In May 2013, the EEOC conducted a public meeting on employer wellness programs and their potential intrusion of employee rights and protections under the Americans with Disabilities Act (ADA), the Genetic Information Nondiscrimination Act (GINA) and other federal employment discrimination laws.  Moreover, the EEOC has stated it will be developing a proposed rule that will address, per its interpretation, how the ADA affects wellness programs.

In the meanwhile, litigation on these issues abounds.  In the most recent case to be filed, the EEOC has alleged that an employer violated the ADA by financially penalizing and then terminating an employee who did not participate in the company’s wellness program.   The EEOC claims that Orion Energy Systems, Inc. unlawfully penalized its employee Wendy Schobert when in 2009, after she declined to participate in the company’s wellness program, it required her to pay her entire health care insurance premium and a $50 monthly fee for non-participation.   Moreover,  the wellness plan required participating employees to complete a health risk assessment and submit a blood sample.  Ms. Schobert questioned if the HRA was voluntary and if the medical information collected would be kept confidential.  In essence, Orion managers told her to keep her concerns to herself and to cut the attitude against the wellness program.  She was terminated shortly thereafter.  The EEOC claims that the HRA and other disability related inquiries connected to the wellness program were not voluntary and, therefore, a violation of the ADA.

 

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