3 Red Flags in EEOC’s First ADA Lawsuit Against Wellness Plan

red-308663_1280In a groundbreaking move, the Equal Employment Opportunity Commission (EEOC) is suing an employer, alleging its wellness plan violates the Americans with Disabilities Act (ADA).  It’s a lawsuit well worth taking a gander at.

Here’s what the ADA says:  Employers can only require employees to submit to medical exams and medical inquiries that are “job related and consistent with business necessity.”

One exception: Employers can ask employees to undergo medical exams and answer medical inquiries in conjunction with “voluntary” wellness programs.

However, there’s a problem with the whole “voluntary” part.  The EEOC hasn’t released any definition or guidance as to what it considers a “voluntary” wellness program.

So employers are left to guess what’ voluntary and what isn’t, and that appears to be the root of the problem in the EEOC’s latest lawsuit.

‘Submit to assessment or pay premiums’

Here’s what happened: Wendy Schobert refused to take a health risk assessment that was part of a wellness program sponsored by her employer, Orion Energy Systems.

She had concerns about the confidentiality of the results.

The penalty for not participating: Orion said she had to pay the entire premium for her health insurance – $413 a month, plus a $50 non-participation penalty.

Had she submitted to the assessment, Orion would have picked up the entire tab for her health insurance.

After her refusal to submit to the assessment, Schobert tried to persuade others to follow her lead, which eventually lead to her termination.

EEOC: ‘Wellness program not voluntary’

When the EEOC caught wind of Schobert’s tale, it sued Orion.

The agency’s allegations: The penalty for not participating in the health risk assessment portion of the company’s wellness program – having to pay $463 a month – was so steep it rendered the program “involuntary.”

That alone, however, isn’t illegal.

The EEOC’s real beef is that since medical inquiries were made of Schobert and other employees that were not “job-related and consistent with business necessity” (because they were preventive in nature) and were not part of a voluntary wellness program, the assessment violated the ADA’s rules regarding employee medical exams and inquiries.

The EEOC is also claiming that Orion illegally retaliated against Schobert for voicing her “good-fath” objections to the wellness program.

Warnings to employers

The lawsuit still has to play itself out, but it offers three distinct warnings to employers:

  • Warning No. 1: Expensive penalties are likely to render your wellness programs involuntary in the EEOC’s eyes.  This is the first time the feds have shed light on what they consider “involuntary,” and while no specific threshold was mentioned, it’s clear expensive penalties won’t do you any favors with the EEOC.  Attorney Robin Shea, writing on her Employment & Labor Insider blog, said she recommends erring on the side of caution and offering rewards for wellness participation instead of imposing penalties against non-participants.
  • Warning No. 2: Don’t ask employees to submit to medical exams or inquiries that aren’t job related unless you can say beyond a shadow of a doubt that you’re doing so under a wellness program that is truly “voluntary.”
  • Warning No. 3: Be careful not to retaliate against employees because they refuse to participate in wellness programs or because they voice their displeasure about such programs – even if they go so far as to actively attempt to persuade others not to participate.

Cite: EEOC v. Orion Energy Systems

Source: HR Morning

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