Resources & Insights

Drop the Stick, Use Carrots in Your Employee Wellness Program

May 9, 2017

Things got ugly on the corporate wellness front a couple of years ago.

wellness incentives
CCIG President and COO T. Scott Kennedy.

Companies were increasingly telling their workers they needed to enroll in their wellness programs or else. Mostly, that meant workers were asked to pay a higher share of their health insurance premiums. In the most extreme cases, workers lost their employer health coverage altogether.

Naturally, privacy advocates balked. The Equal Employment Opportunity Commission did, too, taking companies to court for programs that it believed violated antidiscrimination laws.

In one of the more high-profile cases, the EEOC filed suit against Honeywell, alleging in part that its biometric testing program violated the Americans with Disability Act.

Thankfully, everyone eventually came to their senses, dropping the stick approach in favor of carrots. The focus of wellness programs nowadays is much more on incentives rather than negative reinforcement.

Incentives, for you skeptics out there, actually do work.

In a survey conducted by the Rand Corp., the think tank, 75 percent of employers said they included incentives to encourage employee participation in their wellness programs. Unsurprisingly, employers without incentives in place reported far lower participation rates, a median of just 20 percent.


According to Corporate Wellness Insights, when employers use this “carrot method” of motivating workers to get healthy, it can improve office morale and give workers a deeper sense of job satisfaction.

Budgets being budgets, the good news is that employers can do plenty to move the wellness needle without spending a lot, starting with simple things such as organizing group walks, runs or yoga sessions. Coordinating these sorts of activities takes very little money and helps people overcome one of the biggest hurdles to better health.

You can also consider:

  • Encouraging employees to compete against each other in step and other fitness contests.
  • Offering corporate discounts for health club memberships.

According to estimates, every $1 spent on wellness yields $3 in savings in health care premiums. That’s a healthy ROI – even when you factor in whatever you might spend on incentives.

Finally, remember that research has repeatedly shown a clear link between employee engagement and managers who encourage team members to take part. In fact, the direct reports of managers with high overall wellbeing are 15% more likely to have high overall wellbeing.

The bottom line is that wellness can improve your company culture and health. Just make sure you deliver it in an affirmative manner.

T. Scott Kennedy, president and COO of CCIG, has more than 30 years of insurance and risk management experience.

How has your company incorporated wellness into its culture? I’d love to know. Email me at

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