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Nov 11, 2014

Federal Court Rejects EEOC's Attempt to Enjoin Corporate Wellness Program on ADA and GINA Grounds

ABSTRACT: U.S. District Court refuses the EEOC's attempt to block the implementation of Honeywell's employee wellness program, which provides incentives for its employees to take advantage of health screenings.

On October 27, the U.S. Equal Employment Opportunity Commission filed a Petition for a Temporary Restraining Order and Preliminary Injunction against Honeywell International, seeking to prevent the company from implementing its employee wellness plan.  A week later, U.S. District Court Judge Ann Montgomery denied the EEOC’s request.  This is the third such suit challenging company wellness programs that has been filed by the EEOC in the past two months.  The EEOC characterized the company’s wellness plan as providing for “penalties” if employees or their spouses declined to undergo biometric testing.  The biometric test includes a blood draw that will evaluate employees’ and their spouses’ blood pressure, HDL and total cholesterol, glucose, and height, weight and waist circumference (BMI), and will also check for nicotine.  The EEOC contends that the plan violates the Americans With Disabilities Act and Genetic Information Nondiscrimination Act by imposing penalties upon employees who do not elect to undergo biometric testing, and by imposing penalties to obtain medical information from the employees' spouses.

The EEOC’s main ADA concern with the program is that it does not consider participation in the plan to be voluntary.  The ADA restricts against “medical examinations” unless the examination is used to determine whether the employee can perform the essential functions of the job or can do so without posing a direct threat due to a medical condition.  The exception to this rule is for voluntary medical examinations that are part of an employee health program.  In addition, certain other types of testing are exempt from the ADA under the safe harbor provision of the ADA.  The safe harbor provision states that the ADA "shall not be construed" as prohibiting a covered entity "from establishing, sponsoring, observing or administering the terms of a bona fide benefit plan that are based on underwriting risks, classifying risks, or administering such risks that are based on or not inconsistent with State law."  42 U.S.C. § 12201(c)(2). In Seff v. Broward County, 691 F.3d 1221 (11th Cir. 2012), the Eleventh Circuit interpreted an employer’s wellness program which called for the imposition of a biweekly charge for refusing to undergo biometric screening to be a “term” of the employer’s plan, and thus to be within the safe harbor position.  The EEOC addressed Seff in its pleadings, rejecting that holding as inconsistent with the purpose of the safe harbor provision.

In response, Honeywell rejected the EEOC’s characterization of the testing as involuntary, pointing out that Honeywell employees and their spouses independently decide whether to participate in the biometric screening.  Honeywell further responded that its employees are not subject to any discipline or loss of coverage for choosing to participate in the screening, and that choosing to participate results in a company-provided Health Savings Account contribution ranging from $250 to $1,500.  Responding to the EEOC’s assertion that Honeywell’s plan does not fall under the safe harbor provision, Honeywell pointed out that the program is a “term” of its health plan because only employees who are in the Honeywell group health plan are eligible to participate in the wellness program; and that as in Seff, the wellness plan’s biometric screening results are used to identify and assess health risks, and ultimately to reduce claims costs by reducing its employees’ health risks.  Honeywell notes that grouping tobacco users under an adjusted premium accounts for the well-established increased health risks and costs associated with tobacco use.

The EEOC’s GINA claim stems from its characterization of the biometric testing that an employee’s spouse may undergo as “genetic information” within the meaning of GINA.  The EEOC claims an employee’s genetic information includes all information relating to the manifestation of a disease or disorder in a family member, regardless of whether it is possible for the family member’s medical history (in this case the spouse) to have any predictive value with respect to an employee’s propensity to acquire any disease.  Honeywell counters by referring the District Court to case law that opposes such reasoning.  The company also noted that the biometric testing, which records blood pressure, HDL cholesterol level, total cholesterol, and nicotine level among other things, cannot be said to be a genetic test involving an analysis of “DNA, RNA, chromosomes, proteins or metabolites” or “detect[] genotypes, mutations, or chromosomal changes.”  See 29 U.S.C. § 1191b(d)(7).

There are many company-sponsored wellness programs like Honeywell’s, which are designed to provide incentives to employees who voluntarily engage in awareness programs that include an assessment of their personal health and risk factors.   Although it is disconcerting that the EEOC has chosen to challenge Honeywell’s program, Honeywell’s success on this stage (and perhaps going forward) may provide companies with much-needed guidance and a clearer path for designing and implementing their wellness programs in a manner that does not run afoul of the ADA or GINA.