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Employee Wellness Programs: Best Practices in the Midst of Legal Uncertainty

It seems that FitBits® and other exercise trackers are as much the rage these days in the workplace as they are in the gym. Are your friends and colleagues counting steps taken and calories burned? If so, there is a good chance they are doing so as part of an employee wellness program. At least half of all companies who offer health benefits to their employees also offer wellness programs.1 These programs generally offer help with smoking cessation and weight loss. Wellness coordinators may organize lunchtime walks/runs, in-office yoga, and meditation.

Some wellness programs require participants to complete medical history questionnaires or undergo medical examinations, while others offer wellness services without asking employees for confidential health information. Some wellness programs are offered as part of, and linked to, an employer’s group health plan, meaning that employees cannot participate in one without the other. In contrast, some employers offer wellness programs as a separate, entirely voluntary benefit that employees can choose without affecting their access to other benefits.

Reviews of employee wellness programs are mixed. Proponents argue that helping employees develop healthier habits will reduce the employer’s healthcare costs and build a happier and healthier workforce. Wellness programs may reduce absenteeism, achieve higher employee productivity, reduce workers’ compensation and disability-related costs, reduce injuries, and improve employee loyalty and morale.2 Employees may benefit from the social network created by a wellness program, and these programs may benefit employer recruiting, enhancing a company’s image in the eyes of health-conscious potential employees.3

On the flip side, some people find that trying to set aside time to exercise during the busy workday increases stress.4 At least one study found that the pressure to exercise caused by a workplace wellness program actually increased employee stress, as it caused some employees to feel singled out for being overweight, or pressured not only to have a good “work ethic” but also a good “workout ethic.”5 There is also evidence that wellness programs actually do not reduce employers’ health care costs or result in better health for employees.6

Mixed reviews aside, three federal laws -- the Affordable Care Act (ACA), the Health Insurance Portability and Accountability Act (HIPAA), and the Americans with Disabilities Act (ADA) -- provide incentives for employers to offer wellness programs.7 When wellness programs seek information about an employee’s health, however, or require employees to undergo medical exams, they become subject to -- and may be prohibited by -- the ADA’s provisions pertaining to medical inquiries and exams.

The ADA prohibits employers from requiring medical tests or asking employees about their medical conditions unless the exams or inquiries are job-related and consistent with business necessity. 42 U.S.C. § 12112(d)(4)(A). The ADA permits, however, “voluntary medical examinations, including voluntary medical histories, which are part of employee health programs available to employees at that work site.” Id. § 12112(d)(4)(B). Based on this language, employee wellness programs that involve health questionnaires or medical exams are permissible as long as they are “voluntary.”

It turns out, however, that determining whether participation in a wellness program is voluntary is not a simple task. Last April, the EEOC issued a proposed rule governing how the ADA applies to employee wellness programs.8 Consistent with the ADA, the proposed rule says that employees cannot be required to participate in a wellness program, and they may not be denied health coverage or disciplined if they refuse to participate. The EEOC’s position conflicts with the decisions of two federal courts, however, which determined that an employer may condition health insurance coverage on participation in a wellness program that requires medical inquires and exams.9 In an added twist, disability organizations have lodged objections to the EEOC’s proposed rule, arguing that offering employees incentives for participation in a wellness program renders the program not voluntary and thus in violation of the ADA (the EEOC thinks these incentives are permissible under the ADA).10 To date, the EEOC has not issued a final rule.

Given this legal uncertainty, if your company already has a wellness program, or is considering starting one, here are three suggestions to minimize the risk that your wellness program will face down the road:

Keep It Separate: Consider keeping the wellness program completely separate from group health benefits, meaning the employer does not consider the wellness program a term of the group health plan and will not offer reductions on health insurance premiums for participation in the wellness program. While the EEOC’s proposed rule says that offering a financial incentive for enrollment does not render the program “involuntary,” disability groups have argued otherwise.

Keep It Voluntary: Do not require employees to participate in the wellness program, do not deny or limit an employee’s access to other benefits within the group health plan if he or she elects not to participate, and do not retaliate against employees in any way for failing to participate. While two courts have said that the ADA’s provision on medical exams and inquiries does not apply to wellness plans linked to group health plans, other courts may decide differently.

Explain and Assure Confidentiality: Provide employees with written notice that explains (1) what medical information will be obtained as part of the wellness program, (2) how the medical information will be used, (3) who will receive the medical information, (4) restrictions on the medical information’s disclosure, and (5) the methods used to prevent improper disclosure of the medical information. While some business groups objected to this notice requirement, calling it “burdensome,” the EEOC’s proposed rule requires it.

Llisten to the EPS RealSolutions podcast, "Employee Wellness Programs: Best Practices," hosted by Lisa Dishman with insight from author and EPS attorney-consultant, Heather Wydra, Esq.

1Based on data collected in a 2015 survey on employer wellness offerings conducted by the Kaiser Family Foundation and Health Research and Annual Trust. See 

2See Wellness Programs: What are the general steps for implementing a wellness program, and how can a wellness program benefit employers? SHRM (March 25, 2015), available to SHRM members at

3Benefits of Heath Promotion Programs, CDC (October 23, 2013), available at 

4See, e.g., Alexander C. Kaufman, I Tried Exercising During the Middle of the Workday, and I Hated It, Huffington Post (January 25, 2016), available at 

5Greenfield, Rebecca, How Corporate Wellness Programs Can Hurt Your Health, Bloomberg Business (May 20, 2015), available at 

6Lewis, Al; Khanna, Vik; Montrose, Shana, Workplace Wellness Produces No Savings, HealthAffairsBlog (November 25, 2014), available at 

7The incentives offered by the ADA differ from the incentives offered by the ACA and HIPAA. In short, the ADA allows employers to offer employees up to a 30% insurance premium reward for participation in a wellness program, while the ACA and HIPAA allow employers to offer an insurance premium award of up to 50% for wellness programs that include smoking cessation. 

8The EEOC’s Notice of Proposed Rulemaking is available at 

9Seff v. Broward County, Florida, 691 F.3d 1221 (11th Cir. 2012); EEOC v. Flambeau, (W.D. Wis. (Dec. 31, 2015). Both cases hold that the employer’s wellness plan is protected by the ADA’s safe harbor provision, which states that the ADA "shall not be construed" as prohibiting an employer "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). 

10For a discussion of comments made about the EEOC’s proposed rule, see McGowan, Kevin, EEOC's Proposed ADA Wellness Plan Rule Elicits Critical Comments From All Sides, Bloomberg BNA (June 29, 2915), available at