More Companies Refuse to Hire Smokers, Could Save $11,000/year per Worker

Jan. 9, 2012 - PRLog -- More Companies Refuse to Hire Smokers, Could Save $11,000/year
Even More Would If They Knew How, Says Law Prof Behind Movement

40% of Major Companies Charge Smokers as Much as $2000/yr More for Health Insurance  -- FORBES Magazine Goes Even Further, Advising: "DON'T HIRE SMOKERS"

Baylor Health Care System in Texas, the Hollywood Casino in Toledo, Ohio, and Geisinger Health System in Pennsylvania are only the latest companies to follow FORBES suggestion -- "Don't Hire Smokers" -- and thereby save perhaps $11,000 per worker, and even more employers would follow the escalating trend if they know how easy it was to avoid so-called smokers' rights laws, says the public interest law professor who helped start the trend and defend it in court.  http://www.forbes.com/sites/roblynch/2012/01/05/ten-ways-small-businesses-can-lower-healthcare-costs-and-hire-more-people-in-2012/

Although estimates as to the cost savings vary from several thousand dollar a year per worker and upward, a judge who received testimony on the issue under oath concluded that a typical smoker can cost his employer over $11,000 a year (in 2011 dollars), says public interest law professor John Banzhaf, of George Washington University Law School, who participated in the legal proceeding.

In addition to slashing costs -- expenses which would otherwise have to be borne by the company's nonsmoking employees in the form of reduced medical care coverage and/or lower salaries -- a growing number of businesses are concerned about the adverse image having employees who smoke can present.  That's why the trend is strongest among health-related companies, says Banzhaf, suggesting that patients may be turned off if they are treated by a doctor, nurse, or other professional reeking of tobacco smoke, or simply see medical employees standing on hospital grounds smoking.  The same reaction can occur upon encountering smoker employees at gyms, health spas, counseling centers, insurance companies, and many other employers.

However, especially with rising health insurance costs, and worries that the costs will go even higher under health care reform, companies as diverse as Alaska Airlines, the Union Pacific Railroad Company, the Kalamazoo Community College in Michigan, Weyco, a Michigan-based benefits administration company, and Scotts Miracle Gro have -- like the World Health Organization -- stopped hiring smokers.  Indeed, looking ahead, CBS-TV hailed Scotts' policy as a "national model" and a "new reality."

Many employers are reluctant to stop hiring smokers, incorrectly believing that it constitutes unlawful discrimination.  But, notes law professor Banzhaf, except in those states which have so-called nonsmokers' rights laws, it is perfectly legal since being a smoker -- unlike being Black, female, etc. -- is not an immutable characteristic, and numerous courts have upheld such policies, whether adopted by private companies or even by governmental bodies as to which both the state and federal constitutions apply.  Federal laws permit the practice because they don't recognize smokers as a protected class, says Chris Kuzynski with the U.S. Equal Employment Opportunity Commission.

Even in those states with nonsmokers' rights laws, the statutes are rarely if ever enforced, and are also full of loopholes, as both Banzhaf and the American Medical Association (AMA) have pointed out.  There are also many ways to achieve a smokerfree workforce -- similar to a drugfree workforce -- without violating any of these laws, says Banzhaf.

For example, as the AMA's American Medical News has pointed out, even if state laws prohibit employers from outright refusing to hire smokers, no law requires companies to provide any smoking breaks, nor to permit smoking anywhere on company property, even outdoors on its grounds or campuses, in cars in company parking lots, etc.  Thus, as a practical matter, not permitting smoking breaks, and banning smoking anywhere on company property (even inside cars), will probably deter all but the most determined smokers from applying or even remaining employees.

Another approach, which has been used successfully for many years in New Hampshire (which has a smokers' rights law) is to simply prohibit anyone from coming onto the property who has any detectable odor of tobacco smoke residue (sometimes now called "thirdhand tobacco smoke") about him. Unless a smoker is willing to bathe, shampoo, change clothing, brush his teeth, and use mouthwash after each cigarette, he probably cannot meet this stringent workplace requirement and need not be hired or employed, despite the law, notes Banzhaf.

Also, many of the smokers' rights laws provide only very limited protection.  Some, for example, only prohibit companies from making "no smoking" a condition of employment, and do not prohibit paying smokers less, providing them with fewer benefits, etc.  Also, some smokers' rights statutes apply only to government employees, leaving private companies free to not hire smokers. Other statutes apply to and protect only current employees, permitting companies to adopt a "no smokers" policy for future hires, an option which might be especially attractive now with so many very qualified unemployed workers competing for a limited number of positions.

Also, notes Banzhaf, some smokers' rights laws specifically permit companies to charge smokers more for insurance. Under federal law, smokers can be charged more for their health insurance coverage without any need for a company to satisfy the many requirements of  "wellness programs" which generally apply to other increased-risk problems like obesity -- a major benefit for small companies which may not want to meet the many burdens of qualifying.  That's because, in a legal ruling obtained by Prof Banzhaf, the federal government has determined that, while obesity has been classified as either a "health status" or a "disease," smoking is simply a "behavior" which is entitled to no legal protection.

Indeed, already 40% of large and medium-sized companies -- up from 19% in 2011, and only 8% in 2009 -- are expected to charge smokers as much as $2000 more annually in 2012  for their health insurance, with the percentage expected to rise to almost 50% by 2016.

Surveys also show growing public support for using so-called punitive measures to deal with the costs of smoking, including steps which do not enjoy much public support when applied to obesity, lack of exercise, alcohol, and other major health determinants, notes Banzhaf.

Perhaps this is because the enormous costs of smoking -- over $300 billion annually -- are imposed by only small percentage of adults who smoke, but are largely paid by the great majority of people who are nonsmokers in the form of higher taxes (for added expenses under Medicare, Medicaid, veterans' and Indian benefits, other welfare programs, etc.) as well as bloated health insurance premiums.

JOHN F. BANZHAF III, B.S.E.E., J.D., Sc.D.
Professor of Public Interest Law
George Washington University Law School,
FAMRI Dr. William Cahan Distinguished Professor,
Fellow, World Technology Network,
Founder, Action on Smoking and Health (ASH)
2000 H Street, NW, Suite S402
Washington, DC 20052, USA
(202) 994-7229 // (703) 527-8418
http://banzhaf.net/

# # #

John F. Banzhaf III is a Professor of Public Interest Law at George Washington University Law School [http://banzhaf.net/] where he is best known for his work regarding smoking, obesity, discrimination, food and auto safety, political corruption, etc.