Will Delta Air Lines’ $200 surcharge for unvaccinated employees pay off?

silhouette of a pilot in front of a delta airplane
A Delta Airlines pilot wears a face mask to help prevent the spread of the new coronavirus as he walks through a terminal at Hartsfield-Jackson International Airport in Atlanta. A key senator is asking six U.S. airlines, including Delta, to explain the high rates of delayed and canceled flights this summer, and she’s asking whether there are labor shortages despite the airlines getting billions in federal aid to keep workers on the job. AP Photo/Charlie Riedel, File

Delta Air Lines recently announced that its employees are required to get a COVID-19 vaccine, or face a $200 per month increase in their health insurance premiums. But the penalty may not actually help the company mitigate the risk of spreading SARS-CoV-2, the virus that causes COVID-19, say two Northeastern scholars.

There’s a moral reason: Imposing a surcharge on employees who don’t get vaccinated may help Delta cover its increased health insurance costs, but if unvaccinated employees are willing to pay it, they’re still exposing other employees and airline customers to greater risk of infection, says Patricia Illingworth, professor of philosophy and business at Northeastern.

There’s also a purely logistical reason: Employees might not be willing to pay. And the penalty leaves Delta Air Lines on shaky legal ground, says Gary Young, professor of strategic management and healthcare systems.

patricia illingworth and gary young smiling at camera

Patricia Illingworth, is a professor of philosophy and business in the College of Social Sciences and Humanities. Courtesy photo. Gary Young is the director of the Northeastern University Center for Health Policy and Healthcare Research and professor of strategic management and healthcare systems. Photo by Matthew Modoono/Northeastern University

Delta’s policy will be phased in over the coming months: Unvaccinated employees will immediately be required to wear masks indoors on company property. Then, on Sept. 12, they’ll be required to test weekly for the virus, and isolate if the results are positive. On Nov. 1, the $200 monthly health insurance premium surcharge will go into effect.

Delta officials told The Washington Post that roughly 75 percent of its employees are already vaccinated, and the company has been requiring all new employees to be vaccinated since May. None of its vaccinated employees have been hospitalized since the spread of the Delta variant, a spokesperson told The Post, but for those who have needed hospital stays, the average cost to the company has been $50,000 per person.  

But anticipating the cost of hospitalization obscures the more significant human cost of refusing the vaccine, Illingworth says.

“Imposing a $200 surcharge on unvaccinated employees ignores the fact that when people refuse to vaccinate they risk not only their own health, but also the health of others,” she says. “In this case, people who don’t vaccinate put at risk the health and lives of people flying on Delta, fellow employees, people working at the airport, families, and friends. Even if one would rather not be vaccinated for personal reasons, there are other people to think about. We live in communities, and solidarity is necessary.”

And, Illingworth says, in not mandating that employees be vaccinated, Delta may be shifting the financial burden to customers, airport employees, and others who risk exposure to COVID-19 from its unvaccinated employees.

Young, who is also director of the Center for Health Policy and Healthcare Research, adds that Delta may even be on more solid legal ground if it mandated vaccines rather than imposed a penalty for opting out.

As a large, self-insured employer, Delta has more flexibility in setting premiums for its employees than other companies in individual insurance markets or small group markets, which are regulated differently by the Affordable Care Act, Young says.

But a $200 per month penalty “could be construed as being coercive,” he says, opening Delta to the possibility of litigation.

Questions about the legality of vaccine mandates are still working through the courts, but the full approval by the Federal Drug Administration of the Pfizer-BioNTech vaccine has empowered more employers to require it.

“It’s developing law, but in some respects I think employers might be on safer legal ground if they issue mandates as opposed to penalties,” Young says.

For media inquiries, please contact Marirose Sartoretto at m.sartoretto@northeastern.edu or 617-373-5718.