As we posted last week, the EEOC not only sued Honeywell, alleging that its wellness program violated both the ADA and GINA, but sought a temporary restraining order (TRO) barring Honeywell from implementing the surcharges and other financial “penalties” in its wellness plan. The EEOC had alleged that the penalties in the plan were so large that it transformed the voluntary plan into an involuntary plan, which violates the ADA and GINA.
Today, after an oral argument on the EEOC’s motion for a TRO, Judge Ann D. Montgomery of the U.S. District Court for the District of Minnesota denied the EEOC’s TRO request. In a crowded courtroom, the judge ruled from the bench that the EEOC had not established both that there would be irreparable harm if Honeywell were not enjoined from implementing its program and that it was entitled to the TRO after a balancing of the harms to the parties. Judge Montgomery did not address the EEOC’s likelihood of success in the litigation.
We have noted in previous posts that waiting for the EEOC to give some idea on what it believes to be acceptable incentives in a wellness plan is like waiting for Becket’s Godot. Today, Judge Montgomery asked the EEOC the question the corporate wellness world has been waiting for much more than a decade to ask: “At what point does a monetary penalty result in a compulsion?” The EEOC responded that the agency cannot draw a clear line but that Honeywell had crossed it. At least three times during the oral argument, the Court pressed the EEOC to define the point at which voluntary wellness plan becomes involuntary because of the penalties involved. Each time, the EEOC responded that it cannot draw a line but that Honeywell had crossed it.
Of all days that one might anticipate the EEOC to give some idea of what would be acceptable parameters for wellness plan incentives, today was that day–a day in court on the EEOC’s request for a TRO, an extraordinary remedy, in an action brought with extraordinary speed. Alas, like Godot, the guidance did not come. In contrast, Honeywell pointed to the clear guidance on acceptable incentives for wellness plans and acceptable employee contributions in the Affordable Care Act. Honeywell also argued that whether its wellness program was voluntary was irrelevant since it was protected by the ADA “safe harbor” for insurance plans.