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Tuesday, September 16, 2014

EEOC Sues Employer Over Wellness Penalty

We blogged last July about the final rules for wellness incentives, which set specific guidelines around rewards and penalties. Most employers are on board and understand their obligations, but at least one is not.

According to the United Benefits Advisors blog, the Equal Employment Opportunity Commission is suing a Wisconsin company for requiring employees to participate in its wellness program or face a 100% penalty. That's not a typo: participate in the wellness program and the company pays 100% of your insurance premium. Opt out and you get nothing.

The rules clearly state that penalties are limited to 30% of the cost of coverage -- unless the penalty is based on tobacco use, in which case the threshold rises to 50%.

This case underscores the importance of working with a wellness vendor who knows the law. The stakes are simply too high to go it alone. Let an expert help you design an incentive program that is legal and sustainable over the long term.

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