Employment-EEOC Discusses Whether An Employer May Provide Financial Incentive For An Employee To Participate In A Wellness Program Without Violating ADA or GINA

In a letter dated June 24, 2011 (the “Letter”), the Equal Employment Opportunity Commission (the “EEOC”) discusses whether an employer may -without violating the Americans with Disabilities Act (the “ADA”) or the Genetic Information Nondiscrimination Act (“GINA”)-provide financial incentive for an employee to participate in a wellness program. The Letter said the following.

Title I of the ADA allows an employer to conduct voluntary medical examinations and activities, including obtaining voluntary information about medical histories, as part of an employee wellness program. This obtains, so long as any medical information acquired as part of the program is kept confidential and separate from personnel records. For this purpose, an activity is “voluntary”, if the employer neither requires it nor penalizes an employee for not participating in it. The EEOC has not taken (and is not taking in the Letter) a position on whether Title I of the ADA permits an employer to offer financial incentives for an employee to participate in a wellness program that includes disability- related inquiries or medical examinations (the issue being whether those incentives cause the program to fail to be voluntary).

Title II of GINA prohibits an employer from requesting, requiring or purchasing genetic information, subject to six exceptions. One exception is that the employer may acquire genetic information about an employee or his or her family when it offers health or genetic services, including a wellness program, on a voluntary basis. The employee must give prior voluntary, knowing and written authorization to the acquisition of this information. Also, the genetic information may be given to the employer only in aggregate form (that is, it cannot disclose the identity of any individual). Final regulations make it clear that the employer may not offer the employee any financial incentive to furnish the genetic information.

An employer may use the genetic information so acquired to guide the employee into an appropriate disease management program. The program may offer financial incentives for participation and /or for achieving certain health outcomes, provided that the program is open to employees with current health conditions and/or whose lifestyle choices put them at increased risk of developing a condition. For example, employees who voluntarily disclose a family medical history of diabetes, heart disease or high blood pressure on a health risk assessment that satisfies the GINA regulations (specifically Reg. Sec. 1635.8(b)(2)(ii)), and employees who have a current diagnosis of one or more of these conditions, are offered $150 to participate in a wellness program designed to encourage weight loss and a healthy lifestyle. This does not violate Title II of GINA.

Note: An employer should be careful when offering financial incentives in accordance with the Letter. There does not always appear to be a clear distinction between offering financial incentive ” to furnish genetic information”-which is proscribed by GINA- and offering financial incentives “for participation and /or for achieving certain health outcomes” in a wellness program-which GINA allows.