EEOC Seeks to Clarify Wellness Programs, ADA
Employers seeking guidance on implementing workplace wellness programs without violating the law may get some help. The Equal Employment Opportunity Commission has issued a proposed rule on how Title I of the Americans with Disabilities Act applies to wellness programs that are part of group health plans. The agency is accepting public comments through June 19.
“The EEOC’s proposed rule makes clear that wellness programs are permitted under the ADA, but that they may not be used to discriminate based on disability,” according to a statement on the EEOC’s website. “The rule explains that under the ADA, companies may offer incentives of up to 30 percent of the total cost of employee-only coverage in connection with wellness programs. These programs can include medical examinations or questions about employees’ health (such as questions on a health risk assessment).”
The rule says the programs must be voluntary and employers cannot deny health insurance, reduce health benefits, or discipline those who do not participate. Employers cannot interfere with the ADA rights of those who do not participate, and they must provide reasonable accommodation to disabled employees that allow them to participate in wellness programs and earn the incentives the employer is offering.
The programs “must have a reasonable chance of improving health or preventing disease in participating employees,” the EEOC said. “A program that collects information on a health risk assessment to provide feedback to employees about their health risks, or that uses aggregate information from health risk assessments to design programs aimed at particular medical conditions is reasonably designed. A program that collects information without providing feedback to employees or without using the information to design specific health programs is not.”
Finally, employers are only entitled to medical information collected for the wellness program in aggregate form. The employee’s identity must be kept confidential.
“I absolutely think this guidance is needed because employers were left in legal limbo with what to do,” said Ilyse Schuman, shareholder with Littler and cochair of the Workplace Policy Institute. “On one hand, the Affordable Care Act provisions are designed to promote [wellness programs]; at the same time, the EEOC had taken some recent enforcement action challenging the use of incentives in connection with wellness under the EEOC and the Genetic Information Nondiscrimination Act.”
In one case, the agency said an employer violated federal law by requiring an employee to “submit to medical exams and inquiries that were not job-related and consistent with business necessity as part of a so-called ‘wellness program,’ which was not voluntary, and then by firing the employee when she objected to the program,” according to court documents. It said the company’s wellness program “required medical examinations and made disability-related inquiries.” When an employee declined to participate, the company “shifted responsibility for payment of the entire premium for her employee health benefits” to the worker and shortly thereafter fired her.
In a separate case, the agency said an employer threatened to penalize employees if they or their spouses did not submit to biometric tests. Employees said the testing was an unlawful medical exam and violated the ADA and GINA.
A bill recently introduced in Congress seeks to eliminate confusion for employers who offer rewards for participation in wellness programs.
“This is yet another example of the EEOC being out of step with employers and employees,” said Sen. Tim Walberg, R-Mich., chairman of the House Subcommittee on Workforce Protections before the proposed rule was issued. “Innovative approaches that empower employees to take more control of their personal health care decisions should be encouraged, not stymied by greater government overreach.”
The proposed rule defines the incentives employers may use to encourage employee participation in wellness programs that include disability-related inquiries or medical exams. It says incentives are allowable as long as other parameters are met.
“As employers have increasingly turned to wellness programs to improve costs and health, they are faced with a quandary as to how to do that without running afoul of the ADA or GINA,” Schuman explained. “The conflicting messages coming from the administration on the one hand with respect to the ACA and its implementations and regulations, and the EEOC on the other, left employers in the crosshairs. I think [the rule] was a welcome development.”
Wellness programs. The EEOC defines wellness programs as those that “may include, for example: nutrition classes, onsite exercise facilities, weight loss and smoking cessation programs, and/or coaching to help employees meet health goals,” the agency said. “Wellness programs also may incorporate health risk assessments and biometric screenings that measure an employee’s health risk factors, such as body weight and cholesterol, blood glucose, and blood pressure levels.”
Incentives offered by employers typically are in the form of either rewards or penalties, such as prizes or cash, a reduction or increase in health care premiums, or cost sharing. Most employers that offer them use incentives totaling less than $500 per year, according to the EEOC.
Remaining questions. The rule is only a proposal, Schuman noted. She is unsure about such things as the allowable incentives.
“There are questions about how that is determined because the proposed regulations refer to 30 percent of employee-only coverage,” she said, “but often times employees sign up for family coverage. So it doesn’t seem to make sense.”
There is also the matter of GINA. “It doesn’t address GINA at all. That’s still out there,” Schuman said. “Employers are still left with the uncertainty with respect to how wellness programs offering incentives for a spouse to complete a health risk assessment are treated under GINA. This is not the end of the story for direction from the EEOC.”
Workers’ Comp Docket
Traveling Employee’s Collision With Wild Hog Is Compensable
Choctaw Resort Development Enterprise v. Applequist, No. 2014-WC-00969-COA (Miss. Ct. App. 04/21/15)
Ruling: The Mississippi Court of Appeals held that an off-property casino director was entitled to benefits for the injuries she sustained in a car accident.
What it means: In Mississippi, a traveling employee is within the course of employment from the time she leaves home until she returns unless she deviates from her work task on a personal errand.
Summary: An off-property director of player development for a casino worked from her home when she was not traveling, hosting events, or surveying competing bingo halls. She had no fixed employment hours but often worked long hours. She traveled to three new bingo facilities to survey them. The director had only lived in the area for a few weeks, so she asked her sister to accompany her. They left the last casino around 4 a.m. to return home. The director’s sister was driving in a rain storm when their car hit a 400-pound wild hog. The director was injured and hospitalized for several days. She sought workers’ compensation benefits. The Mississippi Court of Appeals held that she was entitled to benefits.
The court explained that travel was a large part of the director’s work. Her boss explained that her job duties included investigating competing gaming operations. The court agreed with the Workers’ Compensation Commission that the director was not on a personal errand when she was injured. She explained that she inspected the gaming operations for their size and location, amenities, and whether their parking lots were full.
The director explained that she asked her sister to drive because she was more familiar with the area. The 68-year-old director also claimed to have taken prescription medication.
The casino asserted that the director did not request reimbursement for her travel on the day of the accident. The director explained that she received travel advances.
Temp Worker’s Injury Covered Under General Liability Policy
Broom v. Wilson Paving & Excavating, Inc., et al., No. 109813 (Okla. 04/07/15)
Ruling: The Oklahoma Supreme Court held that a temporary worker’s injury from a collapsed trench was covered by a subcontractor’s general liability insurance policy.
What it means: In Oklahoma, a temporary worker’s injury can be covered by a subcontractor’s general liability insurance policy when he was an employee of, and received workers’ compensation from, the employment agency.
Summary: A temporary worker went to the offices of Labor Ready, an employment agency, to secure employment. The worker was directed by Labor Ready to work with Wilson Paving. He began work laying pipe inside a trench. The trench in which he was working collapsed, covering him in dirt to his neck. He sustained serious injuries. The worker received workers’ compensation benefits from Labor Ready. He also sued Wilson Paving for his injuries. Wilson Paving had two insurance policies — one for workers’ compensation and liability to employees and a general liability policy that covered injuries to the public. The Oklahoma Supreme Court held that the worker’s injury was covered by Wilson Paving’s general liability policy.
The general liability insurer argued that the worker was not covered under the policy as a temporary worker because there was no agreement granting coverage to a temporary worker. The court pointed out that the policy did not contain language excluding coverage injuries to temporary workers.
The court also explained that the insurer was not immune from liability under the workers’ compensation exclusive remedy provision. The worker was not considered Wilson Paving’s employee at the time of the incident. Labor Ready was identified as his employer in the workers’ compensation action. Negligence was the basis of the worker’s recovery against Wilson Paving.
The court concluded that coverage for the worker’s injuries was not precluded under the policy. The court rejected the insurer’s argument that coverage was excluded because a trench collapse was considered “earth movement” under the policy. The court found that the policy excluded coverage for naturally occurring earth movement such as earthquakes and landslides but several of the terms within the provision such as slipping and caving could be caused by naturally occurring events or man-made events. The record indicated that Wilson Paving expected coverage in a situation such as this. The insurer was aware of the nature of Wilson Paving’s business and could have excluded man-made earth movement from coverage. The court found that the policy only excluded earth movement caused by natural events.
Actual Notice of Injury Not Enough; Worker Must File Claim
Izikson v. Protein Science Corp., et al., No. AC 36325 (Conn. App. Ct. 04/21/15)
Ruling: The Connecticut Appellate Court held that a worker failed to provide proper notice of his claim.
What it means: In Connecticut, a worker must provide written notice that informs his employer of his intent to pursue a workers’ compensation claim.
Summary: A worker for Protein Science Corp. injured his back and leg while lifting a box. He notified Protein Science’s controller of his injuries. The controller prepared a first report of injury form and transmitted it to its insurance provider, Chubb Indemnity Insurance Co. The controller advised the worker to contact Chubb directly to discuss his injuries and learn how to proceed with the matter. Chubb sent the worker a prescription card and filed a form contesting the worker’s assertion that he injured his back in the course of his employment. The worker did not file a notice of claim or request a hearing within one year of his injuries. Protein Science and Chubb did not provide him with medical treatment. Instead, the worker underwent surgery and sought payment for the surgery through his group health insurance carrier. More than one year after the injuries, the worker sought workers’ compensation benefits. The Connecticut Appellate Court held that the worker failed to provide proper notice of his claim.
The worker asserted that based on the totality of the circumstances, Protein Science and Chubb had notice that he was pursuing or intended to pursue workers’ compensation benefits. The worker asserted that Protein Science and Chubb had notice of the injury and his intent to file a claim based on the first report of injury, emails between him and the controller, correspondence from Chubb enclosing a prescription card, a schedule of weekly earnings prepared by the controller, and the form contesting the injury. The court explained that the worker failed to provide written notice of his claim. He pursued benefits through his group health care provider. He did not submit medical bills to Protein Science or Chubb and did not use the prescription card Chubb sent him.
The worker also argued that Chubb’s filing of the form contesting the injury should be an exception to the notice of claim requirement. The court disagreed, stating that the legislature was the proper forum to create additional exceptions.
Nurse’s Fall While Carrying Soiled Clothes Is Linked to Employment
Kilbane v. Lutheran Hospital-Cleveland Clinic, et al., No. 101897 (Ohio Ct. App. 04/16/15)
Ruling: The Ohio Court of Appeals held that a nurse’s fall in the parking lot at the end of her workday was compensable.
What it means: In Ohio, a causal connection exists between a worker’s injury and her employment when the worker was performing a duty for her employer’s benefit when she encountered a hazard and was injured.
Summary: A nurse for Lutheran Hospital was required to change back into her “street clothes” at the end of her workday and deposit her scrub uniform into a hospital laundry basket. As she prepared to leave work, she noticed that her lab coat and shoes were soiled as a result of her operating room duties. The hospital did not clean lab coats or shoes, so she obtained a plastic bag from the operating room and placed her lab coat and shoes inside.
The nurse then retrieved her purse and a container of food and “clocked out.” She crossed the street to the employee parking lot. While she was walking on a hill, wind captured the bag, and she stumbled and fell. The nurse sought workers’ compensation benefits. The Ohio Court of Appeals held that her injury was compensable.
The court rejected the hospital’s argument that the nurse’s injury did not occur in the scope of and arising out of her employment. The court explained that she was required to wear nursing garb while performing her duties. She was required to maintain her lab coat and shoes personally. She could do so only by taking those items with her when she left work for the day. The court said the nurse’s actions when she was injured were consistent with her contact for hire and logically related to the hospital’s business.
The court also found a causal connection between the nurse’s injury and her employment. Her fall resulted from the bag’s hindrance of her safe movement from her workplace to her car. The court explained that she was in the discharge of one of the duties placed upon her for the hospital’s benefit when she encountered a hazard.
Delayed Autopsy Report Tolls 6-Month Time Limit for Seeking Death Benefits
Sheena H., et al. v. West Virginia Office of the Insurance Commissioner, No. 13-0875 (W.Va. 04/10/15)
Ruling: The West Virginia Supreme Court of Appeals held that the six-month statute of limitations for filing a claim for death benefits was tolled until a miner’s heirs received an autopsy report indicating that his death was work-related.
What it means: In West Virginia, the six-month time limitation on filing a claim for death benefits can be tolled until the worker’s heirs receive the autopsy report finding that the worker’s death was work-related when the heirs could not have learned through reasonable diligence that the death was work-related until the autopsy report.
Summary: A coal miner suffered a work-related injury when a wrench fell from a mine’s ceiling and hit him on the head. The injury left him unconscious for one minute and resulted in a golf ball-size knot on his head. His treating physicians prescribed him pain medication.
The miner did not seek additional medical treatment for the injury, and he returned to work two days later. Nearly two years later, the miner died in his sleep. Due to the medical examiner’s delay, an autopsy report was not completed until eight months after his death.
The report declared that the miner’s death was the result of a traumatic seizure disorder that stemmed from the work-related head injury.
Six months after the autopsy report, the miner’s mother applied for death benefits on behalf of the miner’s daughter. Dependents of a deceased worker have six months from the date of the work-related death to apply for death benefits. The employer asserted that the claim was not timely filed. The West Virginia Supreme Court of Appeals held that the six-month statute of limitations was tolled until the mother received the autopsy report.
The mother argued that there was no way of knowing that the miner’s death was work-related until the autopsy report was completed. The court noted that a claim filed before the autopsy report would have been “purely speculative.” The court also said a finding that the time limitation could never be tolled was “patently unfair.”
The court found that the legislature did not intend that a worker’s heirs be completely barred from receiving death benefits where, due to the medical examiner’s delay in completing the autopsy, there was no knowledge that the worker’s death was work-related until eight months after the death, and the heirs promptly filed the claim within six months of learning that the death was work-related. The court noted that it limited its holding to when the delay was on the part of the medical examiner, not the heirs.
The employer also argued that the mother was not a proper party to file for death benefits on behalf of the miner’s daughter. The court said that when a worker or dependent of a worker is mentally or physically incapable of filing the application, it can be filed by her attorney or by a member of her family. Here, the miner’s six-year-old daughter was mentally and physically incapable to file an application for death benefits. The miner’s mother was a member of the daughter’s family, so she could file an application on the daughter’s behalf.
Teacher Connects Respiratory Problems With Dusty, Moldy Classroom
United Heartland, Inc., et al. v. Brown, No. 14-1070 (Iowa Ct. App. 04/08/15)
Ruling: The Iowa Court of Appeals held that a teacher was entitled to workers’ compensation benefits for the respiratory problems she sustained from exposure to mold or dust in her classroom.
What it means: In Iowa, a worker’s respiratory injury arises out of her employment when evidence establishes a causal connection between her injury and the moldy and dusty conditions in the building.
Summary: A teacher for Camanche Community School District taught in a windowless room with little ventilation. She recalled seeing ceiling tiles that were stained from water intrusion and believed a “buildup of dirt and grunge was an ongoing problem” at the school. She brought a humidifier into her classroom to help with her chronic cough and noticed mold on the filter. She claimed that she developed respiratory problems from exposure to mold or dust in her classroom. The Iowa Court of Appeals held that the teacher was entitled to benefits.
The court rejected the school district’s argument that the teacher did not suffer “a pulmonary function injury” related to her work. Although two doctors did not believe the teacher had asthma or a chronic impairment of the respiratory system, a pulmonologist diagnosed the teacher with an occupational lung disease, including hyper-reactive airways and shortness of breath. Another doctor found a positive methacholine challenge test to support his diagnosis of asthma. He also reviewed several air quality reports, which discussed examples of water damage to the school.
The court found that the teacher’s injury arose out of her employment. Expert evidence established a causal relationship between her injury and the conditions in the school. Water had infiltrated the roof and ceiling tiles in the school building. A doctor opined that the water damage more likely than not was the cause of the teacher’s lung injury. Indoor air testing pointed to heavy dust accumulation and elevated levels of carbon dioxide from low ventilation in the building.
The court also pointed out that other teachers experienced sinus and respiratory problems when they were in the building during the school year, which dissipated when they were away from the building.
Making the Marine Industry SAFE
When it comes to marine based businesses there is no one-size-fits-all safety approach. The challenges faced by operators are much more complex than land based businesses.
The most successful marine operators understand that success is dependent on developing custom safety programs and then continually monitoring, training and adapting.
After all, it’s not just dollars at stake but the lives of dedicated crew and employees.
The LIU SAFE Program: Flexible, Pragmatic and Results Driven
Given these high stakes, LIU Marine is launching a new initiative to help clients proactively identify and address potential safety risks. The LIU SAFE Program is offered to clients as a value added service.
“The LIU SAFE program goes beyond traditional loss control. Using specialized risk assessment tools, our risk engineers function as consultants who gather and analyze information to identify potential opportunities for improvement. We then make recommendations customized for the client’s business but that also leverage our knowledge of industry best practices,” said Richard Falcinelli, vice president, LIU Marine Risk Engineering.
It’s the combination of deep expertise, extensive industry knowledge and a global perspective that enables LIU Marine to uniquely address their client’s safety challenges. Long experience has shown the LIU Risk Engineering team that a rigid process will not be successful. The wide variety of operations and safety challenges faced by marine companies simply cannot be addressed with a one-size-fits-all approach.
Therefore, the LIU SAFE program is defined by five core principles that form the basis of each project.
“Our underwriters, risk engineers and claims professionals leverage their years spent as master mariners, surveyors and attorneys to utilize the best project approach to address each client’s unique challenges,” said Falcinelli.
The LIU SAFE Program in Action
When your primary business is transporting dry and liquid bulk cargo throughout the nation’s complex inland river system, safety is always a top concern.
The risks to crew, vessels and cargo are myriad and constantly changing due to weather, water conditions and many other factors.
SCF Marine, a St. Louis-based inland river tug and barge transportation company and part of the Inland River Services business unit of SEACOR Holdings Inc., understands what it takes to operate successfully in these conditions. The company strives for a zero incident operating environment and invests significant time and money in pursuit of that goal.
But when it comes to marine safety, all experienced mariners know that no one person or company has all the answers. So in an effort to continually find ways to improve, SCF management approached McGriff, Seibels & Williams, its marine broker, to see if LIU Marine would be willing to provide their input through an operational review and risk assessment.
The goal of the engagement was clear: SCF wanted to confirm that it was getting the best return possible on its significant investment in safety management.
Using the LIU SAFE framework, LIU’s Risk Engineers began by sending SCF a detailed document request. The requested information covered many aspects of the SCF operation, including recruiting and hiring practices, navigation standards, watch standing procedures, vessel maintenance standards and more.
Following several weeks of document review the LIU team drafted its preliminary report. Next, LIU organized a collaborative meeting at SCF’s headquarters with all of the latter’s senior staff, along with McGriff brokers and LIU underwriters. Each SCF manager gave an overview of their area of responsibility and LIU’s preliminary findings were reviewed in depth. The day ended with a site visit and vessel tour.
“We sent our follow-up report after the meeting and McGriff let us know that it was well received by SCF,” Falcinelli said. “SCF is so focused on safety; we are confident that they will use the information gained from this exercise to further benefit their employees and stakeholders.”
“It was probably one of the most comprehensive efforts that I’ve ever seen undertaken by a carrier’s loss control team,” said Baxter Southern, executive vice president at McGriff, which also is based in St. Louis. “Through the collaborative efforts of all three parties, it was determined that SCF had the right approach and implementation. The process generated some excellent new concepts for implementation as the company grows.”
In addition to the benefits of these new concepts, LIU gained a much deeper understanding of SCF’s operations and is better positioned to provide ongoing loss control support.
“Effective safety management is about being focused and continuously improving, which requires complete commitment from top management,” Falcinelli added. “SCF obviously is on a quest for safety excellence with zero incidents as the goal, and has passed that philosophy down to its entire workforce.”
“SCF’s commitment to the process along with LIU’s expertise was certainly impressive and a key reason for the successful outcome,” Southern concluded.
There are many other ways that the SAFE program can help clients address safety risks. To learn more about how your company could benefit, contact your broker or LIU Marine.
This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Liberty International Underwriters. The editorial staff of Risk & Insurance had no role in its preparation.