A federal judge in Illinois this week refused to dismiss a class action lawsuit brought under the Americans with Disabilities Act based on a “voluntary” wellness program.
Employers should review their wellness programs to determine whether the financial incentives for participation are so attractive that employees may feel they have no choice but to participate. If so, the program may not be “voluntary” and requests for medical information related to the program may violate the ADA.
ADA Review
In addition to prohibiting discrimination on the basis of disability and requiring reasonable accommodation, the ADA has several important provisions regarding employee medical information that apply to all employees, not just those with disabilities.
The simple explanation is as follows:
- Employers may not request medical information from an applicant before a conditional offer of employment has been made.
- After a conditional employment offer is made, an employer can require the offeree to undergo a medical exam or complete a health questionnaire, so long as the employer does the same for all offerees in the same position. And, of course, with limited exceptions, any medical information obtained cannot be used against the offeree.
- Once a recruit becomes an “employee,” an employer may request medical information only if the request is “job-related and consistent with business necessity.”
- However, if an employer has a voluntary wellness program, it may request employee health information in connection with it without violating the ADA. This can include a plethora of information that is “not job-related and inconsistent with business necessity,” such as routine blood tests, weight checks, BMI measurements and blood pressure checks.
- Medical information obtained from employees must be kept confidential and kept separate from the employee’s personnel file.
Again, these rules apply to everyone, disabled and non-disabled employees alike.
Wellness Incentive Lawsuit
A Wisconsin-based employer and its Illinois subsidiary had a wellness program that they considered “voluntary.” No one was fired for refusing to participate. To our knowledge, no one was denied a promotion or had an unfair term or condition of employment imposed on them for refusing to participate.
That seems pretty “spontaneous” to me, Robin!
I agree, with one exception: according to the lawsuit, participants in the wellness program received “discounts” on their health insurance premiums. Non-participants, including the plaintiffs, were not eligible for the discounts.
For one plaintiff who had family health insurance, the additional cost of health insurance was more than $1,800 per year ($34.81 per week).
For many people, $1,800 a year is a lot of money, and it may be enough to “motivate” employees to participate in their employer’s wellness programs or get biometric and health screenings when they don’t really want to.
In other words, the plaintiffs argue that participation in the wellness program is “not voluntary” because the discount for participation is so large. And if participation is not voluntary, then requesting the information would violate the ADA.
The employer sought to dismiss the lawsuit, arguing that it was not “punishing” employees for not participating, but only “encouraging” them to do so. Therefore, the employer argued that the program was voluntary and the lawsuit was without merit.
However, the plaintiffs argued that the lack of incentive for non-participation was, in effect, a penalty for non-participation.
A judge ruled this week that the lawsuit can proceed based on the plaintiffs’ claims.
And did I mention this is a potential class action lawsuit?
There’s more to come!
Courts have ruled on motions to dismiss for failure to state a claim upon which relief may be granted (also known as Rule 12(b)(6) of the Federal Rules of Civil Procedure). Motions to dismiss are typically heard at a very early stage of a case, and the court must assume that the facts alleged in the complaint are true. Under that assumption, if the case states a valid legal claim, the judge must allow the case to proceed. The parties then conduct discovery and file appropriate motions based on the evidence in the case.
So it’s possible that the employer will later win. Even if the case is certified, it may turn out that all of the employees make $1 million a year, in which case the $1,800 a year health insurance cost may not be a big deal. Or it may turn out that the plaintiff’s discount numbers are inaccurate and the incentive is actually 34 cents a month, not $34.81 a week.
However, litigation is costly, and class action lawsuits are even more costly, and employers that offer incentives for participation in wellness programs must determine whether they need to make any changes to minimize their risk of litigation.
Oh, one more thing. There could also be liability under the Genetic Information Nondiscrimination Act. In another case a few years ago, a federal judge refused to dismiss all GINA claims in a lawsuit against the City of Chicago based on similar allegations. In the Chicago case, the city required employees who didn’t participate to pay a $50/month penalty. If their insured spouse also refused to participate, the employees had to pay $100/month. The GINA claims of employees who were individually insured were denied because “genetic information” wasn’t sought. But the GINA claims of employees whose spouses were insured proceeded. (Under GINA, information about a spouse’s health is the employee’s “genetic information,” which never made sense to me because spouses aren’t relatives, but Congress didn’t ask for my opinion.)
