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EEOC wellness incentives have come under legal scrutiny

On Behalf of | Nov 5, 2019 | Employment Law |

In 2016, the Equal Employment Opportunity Commission issued regulations concerning incentives companies could offer for voluntary employee participation in wellness programs.

In 2017, the American Association of Retired Persons won a lawsuit challenging the EEOC incentives rules. Employees may wish to make their own claims against companies where “voluntary” equates to “required” participation.

A little background

The 2016 EEOC regulations concerning company wellness programs permitted businesses to offer incentives for voluntary employee participation to align with the Americans with Disabilities Act, as well as the Generic Information Nondiscrimination Act. Companies could entice employees to join by offering discounts of up to 30% of the cost of their health coverage. On the flip side, this meant that employees who chose not to participate would realize up to a 30% penalty.

AARP steps in

In its lawsuit, the AARP argued that the EEOC failed to show how the offer of health insurance discounts could translate to voluntary participation in a wellness plan. In 2017, the U.S. District Court for the District of Columbia sided with the AARP, ruling to vacate the EEOC incentive rules, effective January 1, 2019. However, incentives in any form are not expressly prohibited.

Current regulations

The regulations that remain specify that an employee health program is voluntary under certain conditions:

  • That the company does not require employee participation
  • That it does not deny coverage under any group health plan or benefits within such a plan
  • That it does not limit benefits for employees who choose not to participate
  • That the company does not retaliate against, intimidate, coerce, interfere with or threaten employees for non-participation in a health program
  • That it provides employees with advice as to how the company will use and disseminate their medical information

Seeking help

The EEOC regulations concerning wellness program incentives are still under scrutiny, and employees may find themselves ensnared, not knowing how to proceed. One option is to seek legal review of any such program and decide how to proceed upon counsel’s advice.