U-Haul’s Nicotine Policy Is More Than Justified, But It Needs Tweaks

U-Haul’s new policy of declining to hire nicotine users is more than justified by the huge costs smokers impose on their employers and fellow workers, but it is also both too broad and too narrow in different ways, says public interest law professor John BanzhafBanzhaf helped establish the no-smoker movement, and helped defend it in several precedent-setting law suits.

The best estimate of the costs associated with hiring smokers came in a case in which Banzhaf participated.  After hearing evidence under oath by both sides, a judge ruled that a typical smoking employee costs his employer over $12,000 each and every year (in 2019 dollars). Thus, if only 15% of a company’s work force are smokers, there is about $1,800 of the cost attributed to those smoking employees which is not available for increased health insurance coverage, higher salaries, or other benefits for each employee.

Banzhaf suggests that health care costs may be even higher because the spouses of smokers are more likely to be smokers themselves, and everyone in the household is typically exposed to tobacco smoke pollution which kills almost over 40,000 nonsmoking Americans each year, and causes far more serious illnesses, expensive hospitalizations, etc.  All together, smoking costs the U.S. economy over $332 billion in direct health care costs and lost productivity every year, according to the American Lung Association.

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U-Haul’s goals with tobacco policy

The law is also clear that, in the absence of specific legislation, both private employers and even governmental bodies may decline to hire smokers since being a smoker is not a legally protected factor like race, sex, etc., notes Banzhaf.

U-Haul says that it will not apply the policy in states which have laws protecting smokers’ employment, but both Banzhaf and the AMA have shown that such laws may not apply in this situation.

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.  Indeed, some states specifically permit companies to charge smokers more for insurance, thereby providing a simple tactic to avoid hiring smokers, or of making them pay their fair share of the added costs of employing them.

Also, some smoker statutes apply only to state 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.

A tweak to tobacco policy

Another proven way to avoid the enormous costs smokers impose on their employer and nonsmoking employers is to adopt a rule prohibiting employees from coming to work with any detectable odor of tobacco smoke on their persons.

Although such a rule – which has actually been used in a state with a smoker-employment protection law – does not prohibit smokers from being hired, it makes it very difficult for them to be employed.  It virtually requires them to take a shower and shampoo, as well as change their clothes, every time they light up, says Banzhaf, who has helped promote this policy.

At the same time, suggests Banzhaf U-Haul’s new policy is too broad because it apparently prohibits employees from using nicotine gum and patches to help them quit smoking, even though there is no evidence that such FDA-approved products cause illness or add to medical costs.