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Be Careful About Vaccine Incentives

Jan. 25, 2021
EEOC wellness and disabilities rules can cause complications.

As we recently learned, some employers have chosen to wield the carrot rather than the stick when it comes to motivating their employees to be vaccinated against the COVID-19 virus by offering them financial incentives instead of threatening them with loss of employment.

A recent article by Adrienne Selko points out that among the employers who have embarked on vaccine incentive programs for their employees are such well-known corporate entities as Trader Joe’s, Instacart and Dollar General. At this point, it is still unclear whether these financial incentives will be sufficient to overcome widespread fears concerning the efficacy and aide effects of the various vaccines now being distributed.

As we had earlier reported last November, it is legal for employers to require their employees to be vaccinated, as long as they adhere to safety and anti-discrimination laws. The Occupational Safety and Health Administration (OSHA) allows employers to impose legitimate health and safety policies if they are job-related and consistent with business necessity.

At present, OSHA standards that apply to situations where employers whose policies require flu vaccines for their workforce also can apply to mandatory COVID-19 vaccinations. However, employees can refuse the vaccine because they reasonably believe they have a medical condition that creates danger of serious illness or death (such as a serious reaction to the vaccine). In fact. they may be protected in a manner similar to how a whistleblower is under the law.

During the presidential campaign, Biden promised that at some point he will make sure that OSHA adopts Emergency Temporary Standards (ETS) to deal with the pandemic, which will have the force of regulations and including the threat of enforcement through the use of citations and penalties if they are not followed by employers.

Also applying to both mandatory vaccination and voluntary financial incentive programs are the Americans with Disabilities Act (ADA) and the Civil Rights Act, which are enforced by the U.S. Equal Employment Opportunity Commission (EEOC).

On Jan. 16, the commission issued vaccine standards designed to revise its previous policy in this regard. Under the ADA, the EEOC said an employer can require that an employee get vaccinated for COVID-19 only if they can show there is a direct threat to others if the employee remains unvaccinated.

To make this showing, the employer must evaluate the risk to others by describing the duration of the risk; the nature and severity of the potential harm; the likelihood that the potential harm will occur; and the imminence of the potential harm.

EEOC stresses that employees are allowed to receive the vaccine from a third party even if it does not have a contract with their employer. The commission also stated that as far as it is concerned, a vaccine is not considered to be a medical examination and that asking employees whether they have been vaccinated is not a prohibited disability-related inquiry.

On the other hand, the commission emphasizes that pre-screening questions asked by the employer or contractor administering the vaccine “may” implicate the ADA’s provision prohibiting disability-related inquiries if they are “likely” to elicit information about a disability.

Exceptions to this restriction include situations where an employer offers vaccination to employees on a voluntary basis and their decision to answer the pre-screening questions also is voluntary, and as a result will not pose an issue under the ADA, according to attorneys for the Seyfarth Shaw law firm.

In this case, the employee can choose not to answer such questions, and the only consequence they can suffer is that they will not receive the vaccine. Secondly, if the employer mandates that employees receive a COVID vaccine from a third party with whom the employer does not have a contract, the ADA restrictions on disability-related inquiries don’t apply.

When it comes to employer wellness program rules as they are presently constituted, the ADA generally permits employers to make medical examinations or inquiries in connection with such a program, but only if it can be defined as being “voluntary” for the employees, Seyfarth Shaw attorneys observe.

New Wellness Requirements

On Jan. 7, the EEOC followed up by introducing proposed changes to its wellness program regulations that employers should be mindful of. If adopted, these wellness program rules would require:

• The program is reasonably designed to promote health or prevent disease, is not overly burdensome, and is not a subterfuge for discrimination.

• It is not a “gateway plan,” requiring employees to submit to a medical exam or inquiry in order to access an enhanced benefits package.

• The program offers a reasonable accommodation to persons for whom it is medically inadvisable to participate.

• Participants are provided with a notice informing them of why their information is being requested, how it will be used, and how it will be protected.

• Incentives are limited.

This final requirement, relating to the level of permitted incentives, is in a state of flux, the attorneys note. In 2016, the EEOC finalized regulations that would permit an incentive of up to 30% of the cost of self-only coverage under the employer’s health plan. Those regulations were challenged by the AARP and ultimately were struck down by a federal court.

If adopted, the new rule would limit any incentives offered in connection with a participation-only wellness program (that is, one where participants are simply required to submit to a medical exam or inquiry but not required to achieve any particular outcome) to a “de minimis”—legally minimal—threshold. Examples of permissible incentives contained in the proposed regulations include such things as a water bottle or a gift card of modest value.

“There’s a possibility these regulations could be frozen by the incoming Biden Administration and/or revised before taking final form,” the Seyfarth Shaw attorneys warn. “In any event, it’s unlikely the regulations would be finalized before more broad-based vaccine rollouts take place.”

Employers also need to keep in mind state and local health laws and regulations that may apply to company vaccination programs, and any negotiations that made required with a union in situations where a collective bargaining agreement is in force and its terms may apply.

Voluntary Vaccination Advice

When it comes to creating a voluntary vaccination program, attorneys Amy Karff Halevy and Amber K. Dodds of the Bracewell law firm suggest employers carefully consider both the timing and messaging.

Employers will likely want to set a time period during which employees must be vaccinated in order to receive the incentive, they advise. “A shorter time period could be used to encourage employees to get vaccinated as soon as it becomes available to them. A longer time period might allow employees to delay vaccination (e.g., employees who are pregnant) and still ultimately be eligible for the incentive.”

Employees who provide proof that they were vaccinated before the incentive was in effect probably should be considered eligible to receive the incentive, Halevy and Dodds recommend.

When it comes to messaging, they also suggest that when it is time to discuss the incentive with workers, employers could leave open the possibility that they may choose to mandate vaccination at a later date. This would convey the message that if the employer implements a mandatory vaccination program, employees who choose not to be vaccinated during the incentive timeframe would not be eligible to receive the incentive.

They add that employers that implement an incentive program should consider designating a program coordinator or other assigned individuals to receive, review and respond to questions and document vaccinations and receipt of the incentive. Information received from employees documenting vaccination should be treated as confidential.

Halevy and Dodds also point out that employers can consider other methods at their disposal that can be deployed to encourage employee vaccination, and they may want to consider additional options either in place of or in addition to incentives.

This can include things such as rolling out a communication program designed to encourage employees to follow the Centers for Disease Control and Prevention (CDC) recommendations regarding vaccinations, rather than suggesting that the employer endorses any particular vaccine, the attorneys say.

Employees also could be supplied with factual information about the vaccines to assist them in making their decisions. For example, information provided by the CDC outlines common questions about the vaccine, such as how it was developed, how it works, the pros and cons of vaccination, and vaccination questions for subgroups such as pregnant women.

Employees could be provided with logistical information about the vaccines that can assist them in getting vaccinated, This could include such things as helping them figure out where to get the vaccine, how to make an appointment, and information about what to expect when they get there. Remember that state or local health departments provide information about vaccination locations and appointments, the attorneys note.

If feasible, employers can make the vaccine available on site for no cost to the employee (which is much like what many employers have chosen to do for the flu vaccine), which will make it convenient for employees to get vaccinated.

If this does not represent a viable alternative, an employer can offer approved time off from regularly scheduled work (paid or unpaid) to encourage employees to get vaccinated. For some employees, it may take a full day to get vaccinated, in which case it could be akin to a floating holiday, Halevy and Dodds suggest.

About the Author

David Sparkman

David Sparkman is founding editor of ACWI Advance (www.acwi.org), the newsletter of the American Chain of Warehouses Inc. He also heads David Sparkman Consulting, a Washington D.C. area public relations and communications firm. Prior to these he was director of industry relations for the International Warehouse Logistics Association. Sparkman has also been a freelance writer, specializing in logistics and freight transportation. He has served as vice president of communications for the American Moving and Storage Association, director of communications for the National Private Truck Council, and for two decades with American Trucking Associations on its weekly newspaper, Transport Topics.

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