KTP

Many news outlets are reporting the decision by Delta Airlines to impose a $200/month surcharge on employees who refuse the COVID vaccine. Here is a link to the Wall Street Journal's article: Delta Air Lines to Impose $200 Monthly Charge on Unvaccinated Employees, Add Testing Requirements - WSJ My initial reaction is that COVID vaccination status is a "health factor" under Treas. Reg. 54.9802-1(a)(1)(iv) (Receipt of health care) or (v) (Medical history). One could also argue that refusing the COVID vaccination a health factor because it is analogous to the dangerous activities listed under "evidence of insurability" in Treas. Reg. 54.9802-1(a)(2)(ii). It seems like the $200/month is a higher premium under 54.9802-1(c) for a similarly situated individual - it is a stretch to argue that COVID vaccinated employees/non-COVID vaccinated employees are not "similarly situated" because vaccination status is a bona fide employment-based classification under 54.9802-1(d)(1). That leaves the exception for nondiscriminatory wellness programs in 54.9802-1(f), and specifically the exception for "activity only" wellness programs in 54.9802-1(f)(1)(iv), since the $200 is related to a health factor. The activity-only wellness program would need to complete with the frequency, size of reward, reasonable design, and uniform availability/reasonable alternative standards requirements of 54.9802-1(f)(3)(iv). It seems like the employee's personal physician can offer an alternative if he/she is willing to say that obtaining the COVID vaccine is not medically appropriate for that individual - although it is unclear what the alternative would be in this circumstance. 54.9802-1(f)(3)(iv)(C)(4)