United States: A New Year, A New Wellness Program

Seyfarth Synopsis: New Year's resolutions typically address health and well-being. Many among us have resolved this year to get off the couch, to sweat a bit more often to the "oldies," to meditate and be mindful, and to eat less cake and fewer tacos. And so one might think that courts would endorse the EEOC's approval of employer-sponsored wellness programs, as a great way to encourage employees to follow through on their health goals. But beware! A recent federal court decision in D.C. has cited two statutes葉he ADA and GINA葉o roll back the EEOC regulation approving employer wellness programs. This decision, though prospective only, may significantly affect the structure of such programs, including those in California.

The Legal Landscape

GINA葉he Genetic Information Nondiscrimination Act of 2008擁s a federal law that protects individuals from genetic discrimination in health insurance and employment. GINA prohibits employers from using genetic information in hiring, firing, promotion, and pay decisions, or in determining privileges or terms of employment, including health insurance, although employers may collect genetic information as part of a wellness program, so long as the employee's provision of the information is "voluntary."

ADA葉he Americans with Disabilities Act用rohibits many medical inquiries and generally permits employers to collect medical data only in connection with a "voluntary" employee health program.

California's GINA equivalentCalGINA用assed in 2011. CalGINA added "genetic information" to the list of protected classes found in California laws, including public accommodations statutes, the California Fair Employment and Housing Act ("FEHA"), and the Health and Safety Code. CalGINA also empowers plaintiffs to recover unlimited monetary damages, without facing the damages caps existing under federal law.

The EEOC, administering both GINA and the ADA, has issued regulations allowing employers to provide employees with financial incentives蓉p to 30%葉o participate in wellness programs and to disclose genetic information in order to participate. These incentives effectively penalize employees who fail to participate, as they would pay more for health coverage. Many California employers容qually subject to the ADA, GINA, and the broader CalGINA羊ely on the EEOC regulations to structure incentives in their workplace wellness programs. In light of CalGINA's unlimited damages provision, any changes to the permissible structuring of wellness programs creates peculiar exposure for California employers.

The Challenge to the ADA and GINA Regulations

In October 2016, AARP (once called the American Association of Retired Persons) challenged the EEOC regulations, arguing that wellness programs are not really "voluntary" if, as the EEOC would allow, employers can charge employees up to 30% more if they refuse to disclose the medical and genetic information required by a wellness program. The EEOC defended its regulations as a reasonable effort to harmonize ADA, GINA, and HIPAA regulations to promote overall health through participation in employer wellness programs.

The Decision

In its ruling in AARP v. EEOC, a federal district court in the District of Columbia found that the EEOC rules were unlawful, on the ground that the EEOC had failed to provide a reasoned explanation for its decision to adopt the 30% incentive levels. The EEOC, in particular, had failed to show how a 30% differential in employee cost would be consistent with the employee's participation being "voluntary" as opposed to coerced. On December 20, 2017, the court vacated the EEOC regulations and remanded them to the EEOC for reconsideration.

To avoid unnecessary disruption to employers and employees, the court left the regulations in place till January 1, 2019. While this distant date may seem to leave plenty of time to review and revise wellness programs, employers would do well not to procrastinate.

This resolution is particularly significant for California employers who risk unlimited exposure if they do not restructure their wellness programs in advance of January 2019.

Legislative Changes Looming

Employers should keep an ear to the ground for legislation that may further adjust wellness programs. In March 2017, House Representative Virginia Fox of North Carolina introduced H.R. 1313, the Preserving Employee Wellness Programs Act. The new bill has yet to come before the Senate. The bill, if passed into law, would allow employers to impose penalties of up to 30% of the total cost of the employee's health insurance on employees who do not provide genetic information to participate in an employer-sponsored wellness program. The bill would thereby weaken the role of the EEOC's oversight over genetic discrimination in wellness programs.

Workplace Solutions

California employers should know that the decision rolling back the EEOC regulations can threaten the viability of their wellness programs. Employers should now assess the extent to which their wellness programs provide incentives for divulging medical information, and decide whether those incentives, in light of the evolving case law, are defensible as being truly "voluntary." Given the litigious nature of the Golden State, animated by the incentive of unlimited damages, California employers should be especially wary of programs that use financial incentives or penalties to encourage wellness program participation. Cautious employers should start the new year with a fresh look at the incentives built into their wellness programs and take steps to revise them as necessary.

Happy New Year!

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
Brown Smith Wallace
Wilson Elser Moskowitz Edelman & Dicker LLP
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Brown Smith Wallace
Wilson Elser Moskowitz Edelman & Dicker LLP
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you致e read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq痴 use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor痴 own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq痴 Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq痴 Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq痴 right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions