ADA’s safe harbor provision With healthcare costs continuing to increase, employers understandably, want to keep health care costs at manageable levels while also gaining a more efficient, healthy & productive workforce. To do that, many companies have incorporated wellness programs into their employee insurance plans. In a recent survey conducted by Workforce Management magazine (www.nationalemployeewellnessmonth.com), 83% of the organizations surveyed offer such programs.
Examples of wellness programs could include nutrition counseling, cholesterol and other health care testing, flu shots, or smoking cessation programs.
In doing so, it’s important that employers be careful about their ADA obligations. Take caution when you require employees to take a medical examination or “mak[ing] inquiries of an employee as to whether such employee is an individual with a disability or as to the nature or severity of the disability, unless such examination or inquiry is shown to be job-related and consistent with business necessity.”
The ADA contains a “safe harbor” provision that allows covered entities to establish, sponsor, observe, or administer “the terms of a bona fide benefit plan” that are based on risks.
Recent cases have provided employers with some guidelines in how to establish such programs without potentially violating the ADA. A federal appeals court upheld an employer’s wellness program because it fell within the protection of the safe harbor. In this particular case, the employer established a wellness program consisting of two parts:
- a biometric screening; and
- an online health risk questionnaire
Under this safe harbor, the ADA does not prohibit an employer “from establishing, sponsoring, observing or administering the terms of a bona fide benefit plan that are based on underwriting risks, clarifying risks, or administering such risks that are based on or not inconsistent with State law.”
While employees were not required to participate in the wellness program, the employer imposed a recurring charge to employees who enrolled in the health plan but refused to participate in the wellness program. The court held that the safe harbor protected the employer’s practice but didn’t deal with the $20 penalty fee. This decision in the 11th circuit is contrary to EEOC determinations regarding involuntary wellness programs and is not binding on the EEOC.
Check with your legal department before implementing a wellness program. The ADA is clear...it limits when an employer may obtain medical information from applicants and employees:
- Before a job offer is made, the ADA prohibits all disability-related inquiries (i.e., questions likely to elicit information about a disability: “How many sick days did you take in your last job?”) and medical examinations, even if they are related to the job.
- After a conditional offer is made, an employer may ask disability-related questions and require medical examinations as long as it does so for ALL entering employees in the same job category.
- Once employment begins, an employer may make disability-related inquiries and require medical examinations only if they are job-related and consistent with business necessity.
This information should not be construed as “legal advice” for a particular set of facts or circumstances. It is intended only to be a practical guide for participants familiar with this subject. Users should seek appropriate legal advice tailored to address their specific situation.