Same-sex Marriage Change Raises Three Key Points for Employers

Most Americans welcomed the Supreme Court’s ruling in favor of same-sex marriage in Obergefell v. Hodges, which also simplifies things for employers, as they no longer have to navigate conflicting state laws on the issue.

But the work is not done for employers and their benefit plans.  In addition to the obvious step of updating/checking the definition of “spouse” in all benefit plans to keep up with this ruling – and last year’s United States v. Windsor decision — three new items should be addressed going forward:

  • Because the Obergefell ruling was based on constitutional protections, its holding is retroactive. Therefore both employers and employees may request a refund or adjustment of payroll taxes paid on imputed income for same-sex spousal benefit coverage for open tax years (usually three years back).
  • Employers should consider eliminating benefits for unmarried same-sex “domestic partners” (unless similar benefits are offered to opposite-sex partners), or else they could face reverse discrimination claims from employees in opposite-sex partnerships. This issue can get complicated in states like New Jersey, where “domestic partners” are protected under state law.
  • Employers that offer less paid time off for paternity leave than for maternity leave may want to consider how such a policy will play out for same-sex male couples. Similarly, employers and their plan providers may have to work through whether they fund in vitro fertilization treatments or surrogate pregnancies for same-sex couples.

Michael Homans is a Labor & Employment attorney and Chair of the Litigation Department at Flaster Greenberg PC. For more employment law updates, including news and links to important information pertaining to legal developments that may affect your business, subscribe to Michael’s blog, or follow him on Twitter @EmployLawUpdate.

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