Certain employers might prefer to avoid hiring nicotine users: smokers, dippers and vapers alike. U-Haul International Inc. will do so, with its policy going into effect on Feb. 1.
Thus, this is an opportune moment to examine why employers might consider doing likewise, the legal ramifications of such policies and the alternatives to healthier workforces.
Is there practical merit to such a ban?
On its face, there is a business case to be made. Studies have shown that nicotine use is detrimental to one's health. A simple Google search reveals an array of health issues linked to tobacco, such as cancer, respiratory diseases and cardiovascular diseases. Headlines further reveal grave risks with vaping. Plus, studies have shown that smokers take more breaks and miss more days of work than their nonsmoking colleagues do.
These all translate to more costs. A 2013 Ohio State University study confirms this. Researchers, reviewing smokers' absenteeism, productivity and health insurance, found that they cost their employers an average of $6,000 more per year than those who have never smoked.1 This amount is bound to be even higher in 2020.
Is there legal merit to such a ban?
That question is problematic . Twenty-nine states and Washington, D.C., have statutes that either prohibit employers from discriminating against an employee's lawful off-duty activities (which necessarily includes nicotine usage) or prohibit discrimination based on one's tobacco use.2 Some contain exemptions for employers seeking to create new law.3
There are, so far, no equivalent risks under federal law. For example, courts have held that nicotine addiction is not a disability under the Americans with Disabilities Act.4 Courts have also declined to grant constitutional protection to government employees based on a right to use nicotine-based products.
Are there practical problems to such a ban?
Being a frontrunner brings publicity and attention with no guarantee that it will be approving. Firing incumbents who fail to quit may prompt other employees to seek the protection of a union. Plus, employers with a reputation for controlling employees' private lives and choices may deter even non-tobacco users from wanting to work there.
For multistate employers, the patchwork of state laws poses challenges in applying, for example, a no-nicotine rule in Pennsylvania but not in New Jersey. Employment litigation is opportunistic and may permit claims for a New Jersey resident who applies for a job in Pennsylvania but is denied employment there.5
Will such a ban have the intended impact on health care costs?
Presumably, one of the primary reasons for banning the hire of nicotine users is to save costs in the employer's group health plan. While it is highly dependent on the facts, this type of policy may not reduce health care costs nearly as much as an optimistic employer hopes it will.
Hiring a nonsmoker does not guarantee that the employee will not have a spouse, child or other dependent covered under the employer's group health plan who is a nicotine user. If those family members are covered under the employer's group health plan, the plan will still incur costs stemming from nicotine use. In fact, with an estimated 34.2 million American adults in the United States smoking cigarettes in 2018,6 it is a distinct possibility that a nonsmoking employee will have a covered dependent who is a user.
Once hired, can an employer use health plan information to fire nicotine users?
Banning nicotine users may also be difficult to enforce practically, since a candidate could lie about nicotine use. The employer's ability to obtain information that the employee uses nicotine is limited by the Health Insurance Portability and Accountability Act. Information that relates to a past, present or future physical or mental health condition, payment for health care, or provision of health care and identifies or can be used to identify a particular individual under a group health care plan constitutes protected health information.
This protected health information cannot be used for employment actions suc h as hiring, firing and employee discipline. Therefore, it is entirely possible that a smoker could misrepresent nicotine usage during the application process, go to the doctor and potentially even receive medical treatment related to smoking under the employer's group health plan, while that information would be unavailable to the employer to use in its capacity as employer.
How are other employers addressing the costs of nicotine usage in their workforce?
Employers who don't want to go so far as to implement a policy banning nicotine users but seek to address health care costs often try to do so through workplace wellness programs. These include, for example, tobacco cessation programs that provide employees with incentives to quit smoking. Employers have repeatedly adopted these types of programs, which often impose surcharges on nicotine users that are then used to cover claims and pay for administrative expenses under the employer's group health plan.
Yet, these programs are not controversy-free. The U.S. Department of Labor has challenged tobacco cessation programs as violating HIPAA's nondiscrimination rules and the Employee Retirement Income Security Act. For instance, the DOL has sued Macy's Inc., alleging that the tobacco surcharge in its wellness program was discriminatory; that suit remains pending but wellness plans today are being drafted to address the wellness plan features that the DOL challenged in that case.
1. Micah Berman, et al., Estimating the Cost of a Smoking Employee, Tobacco Control (June 2013).
2. The following have enacted these statutes: California; Colorado; Connecticut; Distric t of Columbia; Illinois; Indiana; Kentucky; Louisiana; Maine; Minnesota; Mississippi; Missouri; Montana; Nevada; New Hampshire; New Jersey; New Mexico; New York; North Carolina; North Dakota; Oklahoma; Oregon; Rhode Island, South Carolina; South Dakota; Tennessee; Utah; West Virginia; Wisconsin; and Wyoming.
3. Those exemptions may immunize certain employers (e.g., religious organizations); certain contexts (e.g., collective bargaining agreements that explicitly permit such bans); or certain situations (e.g., where smoking conflicts with a bona fide occupational qualification reasonably related to the individual's employment.
4. Brashear v. Simms, 138 F.Supp.2d 693, 695 (D. Md. 2001) (dismissing suit by prisoner objecting to smoking ban; "common sense compels the conclusion that smoking, whether denominated as 'nicotine addiction' or not, is not a 'disability' within the meaning of the ADA.").
5. Walters v. Safelite Fulfillment, Inc ., 2019 WL 7343481 (D.N.J. Dec . 31, 2019) (refusing to dismiss plaintiff's wrongful discharge and retaliation claims under New Jersey law even though plaintiff was employed in Connecticut because there were connections in his employment and his claims to New Jersey).
6. Center for Disease Control, Current Cigarette Smoking Among Adults in the United States, available at https://www.cdc .gov/tobacco/data_statistics/fact_sheets/adult_data/cig_smoking/index. htm#anchor_1549902047693 (last visited on Jan. 13, 2020).
Originally published on Law360, January 2020
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