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Vaccine Incentives Guidance From EEOC Leaves Employers Guessing

June 14, 2021, 9:16 AM

The U.S. Equal Employment Opportunity Commission guidance on whether incentives can be offered to encourage worker Covid-19 vaccinations raised as many questions as it answered, leaving employers to grapple with what perks might violate the law.

The workplace civil rights agency updated its guidance last month to clarify that employers that don’t administer the vaccination themselves may offer incentives, and those providing the vaccine can do the same—so long as the incentive isn’t “so substantial as to be coercive.”

But what qualifies as coercive remains an open question. Employers have offered benefits ranging from one-time payments to paid time off to encourage an increase in worker vaccination rates, and states are more generally offering cash lottery prizes.

“I don’t think the incentives that most employers are providing—for example, $100 cash bonuses, PTO, company swag, or raffle tickets—would rise to the level of being coercive,” said Sharon Perley Masling, a partner with Morgan, Lewis & Bockius LLP in Washington.

What is unknown is when a cash bonus or other offer is valuable enough to coerce a worker into sharing information that otherwise wouldn’t be shared.

“In the absence of guidance, anything over a de minimis type of incentive would be a risk,” said Elizabeth Pendo, a professor at the Saint Louis University School of Law. “We can think of it as, what if the incentive offered would be something that would make the employee feel that they needed to disclose information that they otherwise would have liked to keep confidential—that’s at the heart of it.”

Federal workplace anti-discrimination laws could be triggered by vaccine incentives if an employer is administering the vaccines and asking a worker for medical information, attorneys said. Workers might also bring bias allegations if they can’t receive a vaccine for religious or medical reasons but their coworkers can, and receive an incentive for doing so.

When asked about plans to provide further clarification on vaccine incentives, EEOC spokeswoman Christine Nazer said the agency doesn’t “have anything to add at this point.”

What’s Coercive?

This isn’t the first time the EEOC has attempted to define what might be a coercive incentive. The agency tried to do so in the context of company-sponsored wellness plan incentives, until a federal judge struck down that definition.

Wellness programs that mandate the disclosure of medical information must be voluntary under the Americans with Disabilities Act and the Genetic Information Nondiscrimination Act, but what qualifies as voluntary remains an open question.

The agency proposed a rule during the Trump administration stating that “de minimis” incentives, like a water bottle or a gift card of a small sum, are acceptable to entice workers to enroll in company-sponsored wellness programs. That rule has since been paused.

The EEOC advised similarly in its most recent Covid-19 guidance.

“You can incentivize the world as long as you yourself are not administering the vaccine,” said Jennifer Shinall, a professor at Vanderbilt Law School, interpreting the agency’s most recent guidance. “If you’re administrating vaccines on site and you’re incentivizing, I think the safest bet would be to offer very small incentives.”

Shinall’s estimate of an acceptable incentive is no more than $100 for an hourly worker, for example.

Boston University School of Law professor Michael Harper said that in his opinion, a one-off incentive is different from a change in benefits—as was the case in the context of wellness program incentives—and therefore isn’t coercive.

The one-time nature “suggests to me that it’s not going to be taken out of the pay or benefits of other employees, so you’re getting something extra for being vaccinated, you’re not being penalized for not being vaccinated,” he said. “If I’m judging that, I don’t say that’s coercive.”

Although questions remain for employers administering the vaccine, and what they can offer, the EEOC guidance did provide clarity for employers turning to third parties for vaccinations—something lawmakers and business groups had wanted for months.

Discrimination Claims

One-time benefit or not, Brian East, a senior attorney with the organization Disability Rights Texas, said that workers with a medical condition who can’t get a vaccine could allege discrimination if their coworkers are receiving the perk of an incentive.

“To me, it is discrimination,” he said. “I really think an alternative should be considered, especially if you’re offering a large incentive.”

Workers who won’t receive a vaccination for religious reasons may be in the same situation—but Linda Correia, a founding member of Correia & Puth PLLC, said there likely wouldn’t be a discrimination claim there. She represents workers in employment matters.

“I would expect that the employee who was not vaccinated for a religious reason would not be treated differently than an employee who just declined to be vaccinated,” she said.

According to Morgan Lewis’ Masling, that legal question remains open. “In other words, do employers have to provide an incentive, such as a cash bonus or raffle tickets, to people who cannot get the vaccine because of disability or sincerely held religious beliefs?” she said in an emailed statement.

A more conservative reading of anti-bias law “dictates providing an incentive in exchange for some action, such as reviewing COVID-19 safety literature, watching a training or even writing an essay,” Masling said.

But some employers may take the risk and only offer incentives to those who have been vaccinated.

“After all, those who are not vaccinated because of a protected reason are being treated exactly the same as similarly situated individuals who have not been vaccinated for other reasons,” she said.

To contact the reporter on this story: Paige Smith in Washington at psmith@bloomberglaw.com

To contact the editors responsible for this story: Travis Tritten at ttritten@bgov.com; Jay-Anne B. Casuga at jcasuga@bloomberglaw.com

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