Why it matters: The Equal Employment Opportunity Commission (EEOC) has filed its third lawsuit challenging the legality of an employer wellness program, this time targeting Honeywell Corporation. The complaint, filed in Minnesota federal court, claims that the company launched a biometric testing program for employees and their spouses that is not job-related or a business necessity that imposes a financial penalty on those who elect not to participate. Honeywell immediately responded with a statement denying liability and adding that the agency is “woefully out of step with the health care marketplace.” Last year, the Departments of Labor (DOL) and Health and Human Services (HHS) as well as the Treasury Department issued guidance to employers offering workplace wellness programs. But because the EEOC did not participate, questions remained about the application of federal law to the guidance. The Honeywell complaint – following two other lawsuits in recent months – demonstrates that at the very least, the EEOC believes the Americans with Disabilities Act (ADA), the Genetic Information Nondiscrimination Act (GINA), and Title VII apply to wellness programs, putting employers on notice to ensure their programs are compliant with the regs and federal law or face an action from the EEOC.

Detailed Discussion

In May 2013, the DOL, HHS, and the Treasury Department issued guidance to employers offering workplace wellness programs that incentivize employees to improve their health. While praising the value of such programs, the regulations set forth several requirements for employers, including that the program be reasonably designed to promote health or disease prevention, not be overly burdensome for employees, with “reasonable alternative standards” provided for outcome-based programs, where a reward is offered to employees who reach a specified target (such as achieving a certain blood pressure goal or body mass index).

The regulations took effect January 1, 2014.

However, employment attorneys remained unclear about the application of federal laws like the ADA (which has a general prohibition on asking disability-related questions unrelated to a job) and GINA (under which employers are forbidden from asking about an employee’s family medical history) to their wellness programs as the EEOC declined to participate in the regulations.

The agency has now answered the question in the affirmative, filing three lawsuits challenging wellness programs. Most recently, the EEOC filed a complaint in Minnesota federal court seeking an injunction to halt Honeywell from engaging in the biometric testing of its employees.

Honeywell announced the new plan at the end of the summer, informing employees that they (and their spouses if they had family coverage) would undergo biometric testing by a vendor for the 2015 health benefit year, the EEOC said. The biometric testing includes a blood draw with the results evaluated for nicotine as well as testing for blood pressure, HDL and total cholesterol, glucose, and height, weight, and waist circumference.

The EEOC alleged that employees will be penalized for failing to participate, losing up to $4,000 in surcharges and lost Health Savings Account (HSA) contributions.

Specifically, employees that do not undergo the testing will lose HSA contributions from Honeywell, which range up to $1,500 depending on the employee’s annual base wage and type of coverage. In addition, a $500 surcharge will be added to the 2015 medical plan costs plus a $1,000 tobacco surcharge for the employee and his or her spouse if they do not submit to the testing, the agency told the court.

According to the complaint, Honeywell initially told employees that the results of the biometric testing would be used to form the basis for goals to help them reduce risk factors like blood pressure in order to receive their HSA contributions.

Although the EEOC requested that Honeywell agree not to impose any penalty or cost upon employees that decline to participate in the biometric testing or reduce any contributions to HSAs or impose any surcharges, the company refused.

The agency responded with a federal complaint seeking an injunction halting the biometric testing. “[B]ased on the EEOC’s review of available information, it appears that Honeywell’s threat to withhold inducements or to impose penalties on employees who did not participate in Honeywell’s biometric testing violates the ADA and GINA,” the EEOC alleged.

The testing violates the ADA because it is not job-related or consistent with business necessity, imposes a penalty upon employees to make them participate, and is not voluntary, the agency said. Honeywell also ran afoul of GINA, the agency claimed, by offering an inducement to obtain the medical information of employees’ spouses.

Preliminary relief is necessary because once an employee takes the test, it cannot “unring the bell.”

“There is no adequate remedy at law for unwarranted, unwanted, and unlawful medical examinations,” the EEOC argued in its complaint. “Once the test is taken, the violation of the statutes cannot be adequately remedied through monetary relief.”

The agency requested that the court issue a temporary restraining order enjoining Honeywell from imposing any penalty or cost, reducing any contribution to an HSA, or imposing any surcharges on employees (or their spouses) for declining the biometric testing, as well as advising employees of the change of plans.

To read the complaint in EEOC v. Honeywell International Corp., click here.