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There's a thin line between incentivizing and penalizing, and though the Equal Employment Opportunity Commission has yet to say it, it seems to be targeting companies that are employing the latter as a motivating tactic to get employees to participate in wellness programs.
Today's defendant? Honeywell International Inc., the largest company sued so far by the EEOC over wellness programs, and the third such company since August, Reuters reports. According to the EEOC's complaint, Honeywell employees faced up to $4,000 in surcharges and lost contributions to healthcare coverage if they did not participate in biometric testing as part of the company's wellness program.
With wellness programs becoming ubiquitous among major employers -- as many as 95 percent offer wellness programs -- your company's wellness program will need to manage the minefield of the Americans with Disabilities Act (ADA), the Genetic Information Nondiscrimination Act (GINA), the Health Information Portability and Accountability Act (HIPPA), the Age Discrimination in Employment Act (ADEA), and Title VII.
3 Lawsuits. Common Factor? Penalization.
Honeywell employees stood to lose up to $4,000 in contributions if they refused to participate, reports Reuters.
Orion Energy Systems was sued by the EEOC back in August after it instituted a program that required medical examinations and made disability-related inquiries. An objecting employee first had her insurance premium coverage cut off, then was terminated.
In late September, the EEOC targeted Flambeau Inc. after the company made its wellness program mandatory. According to the EEOC, those who refused to participate would face cancellation of medical insurance, unspecified disciplinary action, and would be required to pay their own premiums.
In all three cases, employees lost coverage or significant contributions if they refused to participate. According to the National Business Group on Health, about three-quarters of employers use incentives to encourage participation in wellness programs.
The question is: Where is the line between an incentive and a penalty?
EEOC Needs to Offer Additional Guidance
Last year, the EEOC gathered a panel of experts to discuss issues surrounding wellness programs. The consensus was that the EEOC needed to provide further guidance on wellness programs and how they interact with anti-discrimination laws.
EEOC Acting Associate Legal Counsel Christopher Kuczynski explained at the meeting that the ADA allows employers to ask for medical information in connection with wellness programs, but the programs must be "voluntary." Of course, no one knows quite where the line between voluntary and coercive lies, and the panelists seemed to agree that the EEOC should clarify what qualifies as voluntary.
For now, that guidance is limited to the batch of lawsuits filed by the agency. And the three suits have one thing in common: severe penalties and lost coverage for not joining a voluntary program.