Many employers offer a wide variety of benefits to their employees, including on-site gym memberships. While it may be a benefit to the employee, it could lead to Workers’ Compensation liability to the employer. Generally, for an accident to be compensable, it must both occur in the course of employment and arise out of the employment. In order to find that an accidental injury occurred in the course of employment, the injury must have been received while the employee was doing the work for which she was employed.
However, Workers’ Compensation Law Section 10 (1) provides that accidents that are caused by the voluntary participation in off-duty athletic activities that are not part of the employee’s work-related duties, are not compensable, unless (a) the participation was required by the employer, (b) the employee was compensated for the participation or (c) the employer sponsored the activity. Sponsorship by the employer may be found when there is an affirmative act or overt encouragement by the employer to participate. The criterion also includes, but is not limited to, financial support, overt encouragement of employee participation; benefit to the employer; use of the employer’s resources and equipment; and direct control over the event. Encouraging employees by purchasing gym equipment, hiring a coordinator, or offering incentives to employees for using the gym could constitute overt encouragement to use the gym transcending to passive acquiescence and constituting sponsorship within the meaning of WCL Section 10(1).
However, merely providing a free gym membership may not necessarily result in liability under the workers’ compensation law. To mount a successful defense for injuries arising out of gym membership usage, it is important that the employer does not require their employees to participate in such activity, compensate the employee for participating in such activity, or otherwise sponsor the activity.
Commonly, employees sign waivers as part of their gym memberships; however, an employee cannot waive their rights to Workers Compensation’ benefits, so this will not be an automatically successful defense to the claim. However, this does not mean that their claim will automatically be compensable. Due to the large grey area on this issue, some tips to decrease exposure may include:
- Ensure that the employer is not requiring employee participation in using the on-site gym;
- Advise employees that usage of the on-site gym must not be during work hours and that they will not be compensated while using the on-site gym;
- Provide a “sign in/sign out” log to document employee use;
- Limit any work activities to be held in the on-site gym; and
- Limit any incentives to using the on-site gym.