The U.S. Equal Employment Opportunity Commission (“EEOC”) has filed its first lawsuit directly challenging a wellness program under the Americans with Disability Act (“ADA”). The case, EEOC v. Orion Energy Systems, was filed in the U.S. District Court for the Eastern District of Wisconsin on August 20, 2014.
The EEOC alleges that Orion penalized an employee in 2009 after she declined to participate in the company’s wellness program by requiring her to pay her entire health care insurance premium, in addition to a nonparticipation penalty of $50 per month. Shortly thereafter, the employee was fired – a move that the EEOC believes was retaliatory. Further, the agency contends, Orion required medical examinations and made disability-related inquiries of the employee that were neither job-related nor consistent with business necessity, in violation of the ADA. Such examinations and inquiries are permissible, but only if an employee is voluntarily participating in a wellness program. Orion’s program, according to the EEOC, was not truly voluntary because it penalized the employee when she declined to participate.
The EEOC’s press release announcing the suit states that 94% of employers with over 200 workers offer some sort of wellness plan, as do 63% of smaller employers. These employers should be particularly mindful of the numerous changes made to the regulations regarding wellness plans in May of 2013. Health-contingent wellness plans are particularly subject to onerous new legal requirements. If you have implemented a wellness plan for your employees, or are considering doing so, it is crucial that the terms and conditions of this plan are reviewed by legal counsel to ensure full legal compliance.
Anne-Tyler Morgan is an Associate of McBrayer, McGinnis, Leslie & Kirkland, PLLC. Ms. Morgan concentrates her practice in Health Care Law and is located in the firm’s Lexington office. She can be reached at atmorgan@mmlk.com, or at (859) 231-8780.
This article is intended as a summary of federal and state law and does not constitute legal advice.