The EEOC Issues Proposed Regulations That Employers Can Offer Only "De Minimis" Incentives To Encourage Employees To Take COVID-19 Vaccines

Clark Hill PLC

As COVID-19 vaccines begin to be rolled out in the US, surveys show that some employees are skeptical, if not downright opposed, to taking any of the COVID-19 vaccines. In December, the Equal Employment Opportunity Commission (EEOC) recommended that employers encourage, rather than mandate, employees to get vaccinated. In January, however, the EEOC issued proposed regulations that companies can offer only “de minimis” incentives as part of “most” wellness programs to encourage employees to take the vaccinations. As this Alert will discuss, the EEOC’s proposed regulations left employers with open questions about what constitutes a “de minimis” incentive. 

On Dec. 16, 2020, the EEOC issued guidance in the form of FAQs stating that employers can mandate that employees get vaccinated (with limitations) and that employers can ask employees if they have been vaccinated because such inquiries are not medical examinations or disability-related inquiries. However, the EEOC recommended that employers encourage, rather than mandate, that employees get vaccinated because vaccination pre-screening inquiries could run afoul of the Americans with Disabilities Act (ADA) or the Genetic Information Nondiscrimination Act (GINA).

In separate guidance issued on Jan. 7, however, the EEOC published proposed regulations that set limits on the level of incentives employers may offer to encourage employees to get vaccinated as part of “participatory” wellness programs that ask participants to provide medical information. Participatory wellness programs are “those that … do not include any condition for obtaining a reward that is based on an individual satisfying a standard related to a health factor.” The ADA and GINA require that employee participation in participatory wellness programs that include medical questions and exams must be “voluntary.” Because the ADA and GINA do not define “voluntary,” the EEOC issued proposed regulations on wellness programs stating that employers may offer no more than a “de minimis incentive” to encourage employees to participate in a wellness program that incentivizes COVID-19 vaccinations. 

This raises the question of what constitutes a “de minimis incentive.” One such incentive could include paid time off from work to get and recover from the vaccination. Indeed, several large employers (Dollar General, Instacart, and Trader Joe’s) have announced that they will offer paid time off as an incentive for front line employees to get the COVID-19 vaccines. The EEOC’s proposed guidance did not address paid time off as an incentive but did list a water bottle or gift card of modest value as examples of de minimis incentives. The EEOC also indicated that, in most circumstances, offering a $50 per month reduction in annual healthcare costs, paying for an annual gym membership or an airline ticket would not be de minimis incentives. 

Of note, the EEOC’s proposed de minimis rule applies to participatory wellness programs, not “health-contingent” wellness programs that are part of, or qualify as group health plans and are subject to and comply with the applicable provisions of the ACA/HIPAA wellness rule. Among other things, in contrast to “participatory” wellness programs, the proposed de minimis rule states that “health-contingent” wellness programs “require individuals to satisfy a standard related to a health factor to obtain a reward...”

The proposed EEOC regulations on wellness programs are still in the period for public comment, so things may change. In the meantime, employers with questions about whether their wellness program is covered by the EEOC’s proposed regulations or what constitutes a “de minimis incentive” could consult with counsel.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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