In order to avoid costly litigation, employers need to carefully design their wellness program — especially when they reward participants with incentives and discounts on their medical coverage. The EEOC recently sued a Wisconsin employer, claiming the penalty the employer imposed for non-participation in its program was too significant. The EEOC also determined the wellness requirements were involuntary under the Americans with Disabilities Act.

Employers and their advisers should pay careful attention to how the EEOC defines liability in this case, EEOC v. Orion Energy Systems. It is a reminder to stay in compliance with the Affordable Care Act’s rules for wellness as well.

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