Companies Might Charge Employees for Being Unvaccinated. It’s Probably Legal

Rather than enforcing a vaccine mandate, some companies are looking at health coverage surcharges for unvaccinated people.

A person shoots a vaccine into an arm of a person

As more and more people are leaving the remote work life behind to return to the office, some employers are considering charging unvaccinated employees a healthcare fine of up to $50 a month.

Up to this point, companies have mostly tried to use positive incentives in order to encourage workers to get vaccinated, including time off from work, gift cards, and even straight-up cash in certain cases. But as the vaccination rate has plateaued across the United States while cases have steadily risen due to the delta variant of COVID, employers are considering utilizing the so-called “stick,” rather than the “carrot.”

That “stick” would be a special monthly surcharge to financially motivate employees who remain unwilling to get vaccinated.

Wade Symons, the regulatory resources group leader at Mercer, told Forbes that the employee benefits consulting firm has “received inquiries from at least 20 employers over the past few weeks who are giving consideration to adding health coverage surcharges for the unvaccinated as a way to drive up vaccination rates in their workforce.”

According to Mercer, this $20-50 monthly health coverage surcharge would be similar to charges that some companies have for employees who smoke. Tobacco surcharges are legal but have to comply with federal wellness program rules, HIPAA, and the ADA. The same would likely be true of COVID vaccine surcharges.

While this is partially motivated by the general hope that as many people as possible get vaccinated, there is also a financial motivation for companies because an employee who is unvaccinated is far more likely to contract COVID-19, That could, in turn, lead to hospitalization, which company-paid insurance could end up having to pay for, as well as insurance premiums going up due to the illness itself.

The real question is if this type of surcharge would actually be enough to encourage skeptics to finally get vaccinated. It is possible that many unvaccinated workers might be willing to pay the surcharge rather than get vaccinated but perhaps this form of financial motivation would prove effective enough for some to comply.

According to the CDC, 61 percent of Americans over the age of 18 are fully vaccinated, while 71 percent have received at least one dose. Vaccines have been shown to be the most effective way to prevent the spread of COVID, as the majority of hospitalizations due to COVID have been for unvaccinated people. Sadly, this number also includes children, who at the moment cannot be vaccinated.