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February 1, 2016 Amelia Wilcox

Corporate Wellness Laws

Employers who want to keep their workers healthy shouldn’t have to worry about risking litigation to do so. But there are some laws in place that wellness directors are regularly in violation of, whether they know it or not.

Here’s a list of 4 must-know laws that will keep wellness directors from crossing the line.

corporate wellness laws

4 Laws Wellness Directors Need to Know


The Centers for Disease Control and Prevention (CDC) has resources for employers who want to help lower the risk of chronic illness and disease among their workers.

But even with the support of a resource like this, employers need to understand what the laws say about employer sponsored healthcare programs.


1. Legal Rules for Wellness Program Incentives

The changes the Affordable Care Act made to company sponsored wellness programs raised the cap on the allowable cost of incentives from 20% to 30% of the cost of health coverage.

This means any incentives companies provide to employees for participating in a wellness program, or making certain achievements with the program, must not exceed that 30% marker.

Related: Wellness Incentive Ideas: 6 Ways to Use that Carrot

It’s important for companies to factor this in when planning an incentive plan to go along with a company wellness program. Some common wellness program incentives include:

  • Reduced cost of gym pass or personal trainer
  • Gift cards
  • Paid time off
  • Gym clothes
  • Cash

It’s fine to mix and match a variety of incentives for a company health program, just keep the costs no higher than 30% of the total cost of the program


2. HIPAA Rules in the Workplace

The Health Insurance Portability and Accountability Act (HIPAA), passed in 1996, affects the way healthcare is dealt with in the workplace as well as in a medical office.

Among other things, HIPAA ensures that employees are able to continue their health coverage when changing jobs, through programs such as COBRA. It also provides a layer of security on people’s confidential health information.

For a company to be HIPAA compliant, they must keep personal information confidential in secured files, whether they are hard copies or electronic files. For companies who have wellness programs or on site health clinics, this means the company needs to take steps to ensure all employees’ confidential health information is secure.

Even if a company doesn’t have an on site health clinic, any health information gathered for a wellness program needs to be kept in locked drawers or be password protected.

legal rules of company wellness programs


3. Employee Protections and the ADA

The American with Disabilities Act (ADA) provides certain protections for people regarding their personal health conditions. It is because of the ADA, for example, that employers and schools must provide accessible restroom stalls, as well as reasonable accommodations to get expected work completed.

ADA laws give people a privacy protection which means they are not obligated to divulge details about the nature of a condition or disability. Because of this, some forms or paperwork associated with wellness programs may cross the line.

Related: Irresistible Health Fair Giveaways to Boost Attendance 


4. Requiring Employee Participation in Health Programs

Given the laws in place regarding the American with Disabilities Act (#3 above) as well as the rules around incentives (#1 above), employers can get into a lot of trouble if they try to make participation in a wellness program mandatory.

Wellness programs must be voluntary, and employees can’t be penalized for not participating.

The point of incentives is to make participation intriguing to those who might not otherwise join in the wellness fun. But incentives (within the allowable limit) are all that companies can do to encourage participation. 

Amelia Wilcox

Amelia Wilcox is the Founder and CEO of Nivati, a leader in corporate massage and employee mental health support since 2010. Her high-growth B2B company provides employee stress management tools that arm businesses with actionable data and positive employee experiences to improve wellbeing, boost morale, and increase engagement.

Amelia has exponentially grown her company from a solo living-room service business to an international technology brand.

Recently listed as a Forty Under 40, Fast 50, Inc 5000 Twice awarded National Woman-Owned Small Business of the Year

Licenses, Certifications & Memberships
Licensed Massage Therapist since 2002
Member of American Massage Therapy Association
Served on Utah Worksite Wellness Council from 2012-2015

Attended Utah College of Massage Therapy
Educated in Nutrition and Exercise Physiology at the University of Utah

Massage Magazine (AMTA's publication)