A U.S. district judge in Minneapolis is allowing Honeywell to begin penalizing workers who refuse to submit to biometric or medical tests. A federal agency had asked the judge to block the program.

The case will continue to move forward in the court.

The tests, required by Honeywell in a recent policy change, will measure blood pressure, cholesterol and glucose, as well as check for signs that an employee has been smoking. Employees who decline to take the tests could be fined up to $4,000 in surcharges and increased health costs. The U.S. Equal Employment Opportunity Commission (EEOC) had sued Honeywell over the policy last week. Attorneys for the agency argue that the testing program violates the Americans with Disabilities Act and the Genetic Information Nondiscrimination Act by penalizing employees who decline to take part.

U.S. District Judge Ann Montgomery denied the agency's request for a temporary restraining order at a hearing Monday.

In a statement, a Honeywell spokesperson said company officials are pleased that the policy will continue in 2015.

"Honeywell wants its employees to be well informed about their health status not only because it promotes their well being, but also because we don't believe it's fair to the employees who do work to lead healthier lifestyles to subsidize the health care premiums for those who do not," according to the company's statement.

Staff at the Equal Employment Opportunities Commission didn't immediately respond to a request for comment.

The case is the third similar lawsuit filed by the EEOC against companies in recent months. It could have broad implications for what companies can require of employees through wellness plans.