Equal Employment Opportunity Commission Issues Proposed Regulations on Wellness Programs and the Americans with Disabilities Act

Corporate wellness programs,which typically use financial or other incentives to encourage workers to participate in wellness programs, have surged in popularity over the last several years, spurred on by companies seeking ways to lower healthcare costs. However, these programs can cause legal headaches for employers if not administered properly. The Equal Employment Opportunity Commission (EEOC), likely reacting to what it perceives as improper administration, has issued proposed regulations addressing how the Americans with Disabilities Act (ADA) applies to these wellness program. Two of the hallmarks – goal of the program and voluntariness – are described below.

Any employee health program, including a wellness program, must comply with the ADA, which restricts the medical information that employers may obtain from employees and which makes it illegal to discriminate against an employee based on a disability. The proposed rule requires that any employee health program, must be “reasonably designed” to promote health or prevent disease; indeed, the proposed rule states that “the program must have a reasonable chance of improving the health of, or preventing disease in, participating employees, and must not be overly burdensome, a subterfuge for violating the ADA or other laws prohibiting employment discrimination, or highly suspect in the method chosen to promote health or prevent disease.” For instance, an employer who uses the program to identify employees with certain health conditions and to take action based on that knowledge would be violating the ADA.

The wellness plan must be truly voluntary, that is, the employer may not require an employee to participate, may not deny coverage under a group health plan, may not limit the extent of coverage, and may not take any other adverse action against employees who refuse to participate or who do not achieve certain outcomes. While an employer may offer incentives to participate in a wellness program, the total allowable incentive may not exceed 30% of the total cost of employee-only coverage, whether that comes in the form of a reward or a penalty.

The employer must also provide notice explaining what medical information will be obtained, who will receive it, how it will be used, the restrictions on its disclosure, and the methods the employer will use to protect the medical information.

The Notice of Proposed Rulemaking was published in the Federal Registered on April 20, 2015, triggering a sixty-day public comment period.

Karen Adinolfi


Sixth Circuit Addresses Telecommuting as a Reasonable Accommodation

Jane Harris was a Ford steel resale buyer. In this capacity, she served as an intermediary between steel suppliers and parts suppliers, a job description that required a large amount of “good, old-fashioned interpersonal skills” as the court put it.

She also suffered from irritable bowel syndrome, which at best caused her to take frequent trips to the restroom, and at worst caused her to miss whole days of work due to incontinence. Initially, Ford adjusted her schedule to allow for occasionally telecommuting and flexible schedules, but neither option was sufficient. While Ford allowed some employees to work from home one day a week, Harris sought to do so up to four days a week.

It is worth noting that while employed at Ford, Harris’ performance was, as the court put it, “subpar.” She ranked in the bottom 10% of her peers repeatedly, averaged 1.5 missed days of work per week, and was noted as lacking interpersonal and communication skills. In fact, in 2009 she was absent more than she was present.

Following attempts to accommodate her condition and repeated poor reviews, Harris was eventually terminated on September 10, 2009. Four months later, the EEOC sued Ford under the ADA, alleging that Ford failed to reasonably accommodate Harris’ disability and terminated her in retaliation. The district court found that working from home for up to four days a week was not a reasonable accommodation and that Harris’ poor performance was a valid reason for terminating her. The EEOC appealed, and a divided Sixth Circuit panel reversed on both claims in 2014. The Sixth Circuit then granted an en banc review.

Ultimately, the Sixth Circuit Court held that Ford acted reasonably and did not violate the ADA by denying the requested accommodations. The court noted that regular and predicable attendance at the workplace was an essential function of her job, and was a prerequisite to other essential functions. Furthermore, Ford had made attempts to accommodate Harris previously, without success. Finally, the court stated that the EEOC failed to show that Harris’ termination was due to retaliation and not due to her poor workplace performance.

Marcus Pringle