Ruling lands amid a growing wave of similar lawsuits against major US employers
A federal court just handed employers a win in the escalating fight over workplace wellness program surcharges – and HR teams should take note.
On March 20, 2026, Judge David A. Ruiz of the U.S. District Court for the Northern District of Ohio dismissed all five claims brought by current and former Progressive Corporation employees who challenged the company's tobacco and COVID-19 vaccine surcharges under its health benefits plan. The case tackled questions that sit at the center of how HR departments design and communicate wellness incentives.
The dispute centered on Progressive's wellness program, which reduced health insurance premiums for employees who were tobacco-free or, during 2022, vaccinated against COVID-19. Tobacco-free workers paid $15 less per pay period, while vaccinated employees paid $25 less per pay period that year. Plaintiffs Andrea D. Greene and James M. Vaughan argued these premium differences were not wellness incentives but discriminatory surcharges that violated the Employee Retirement Income Security Act.
Their case rested on two main arguments. First, they claimed the plan failed to deliver what ERISA calls the "full reward" because employees who quit smoking or got vaccinated midyear were not retroactively reimbursed for the higher premiums they had already paid. Progressive's plan required employees to stay tobacco-free for twelve months before qualifying for the...
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