Same-sex marriage legalized everywhere: What employers have to do now

The same-sex marriage argument has finally been settled in the U.S — at least from a legal standpoint. Every state is now required to allow and acknowledge same-sex marriages. This has significant implications for employers. Here’s a breakdown of what they are. 

As complicated and as sensitive of an issue as this is, the fallout from the Supreme Court’s ruling in Obergefell v. Hodges is actually quite simple: Same-sex married couples will — in most cases — need to be treated exactly the same as opposite-sex married couples (one exception may be in self-insured health plans; it’s still unclear how the ruling will apply to these plans).

The good thing about this ruling — at least from an employer standpoint: It streamlines the benefits administration process significantly. In a nutshell, if a benefit is offered to employees’ opposite-sex spouses, it should also be offered to employees’ same-sex spouses.

In instances were federal and state law doesn’t specifically carve out protections for same-sex spouses (again, like in self-insured plans), employers would run the risk of violating anti-discrimination laws if they end up treating same-sex spouses differently than opposite-sex spouses.

As a result, the best — and certainly the safest — move is to treat everyone equally.

State, federal law aligned … but it may take time

Helping to streamline benefits administration, the ruling helps align state laws with federal law.

Example: Since the Supreme Court shot down the Defense of Marriage Act’s definition of “spouse” as only including a member of the opposite sex, same-sex spouses have been recognized for federal tax purposes and protected under federal benefits laws — like the FMLA. But some state insurance departments, state taxing authorities and state domestic relations courts weren’t required to recognize same-sex marriage.

That has now changed — or at least it will once every state gets on board with this ruling.

In some states, like Texas, governing authorities have said they’ll wait for guidance on how to handle same-sex marriages before fulling aligning themselves with the High Court’s decision.

This may mean several months may pass before couples are allowed to marry in states that up until now haven’t recognized same-sex marriage.

This also means that while employers certainly can start adding same-sex spouses to their benefits plans, they may want to hold off on eliminating domestic partner benefits (should they wish to do so) until their states fully align with the ruling and same-sex spouses have ample time to get married. How long this will take may vary from state to state.

Domestic partner benefits obsolete?

For those employers that do wish to continue offering domestic partner benefits even after their states have started recognizing same-sex marriage, here’s a word of warning to you: You may have to offer domestic partner benefits to opposite-sex couples as well — or risk facing discrimination charges.

Up until now, domestic partner benefits were a way to extend the same benefits reserved for employees’ spouses to those partners of employees who couldn’t get married. But now that same-sex couples can get married the same as opposite-sex couples, it may now be viewed as discriminatory to only offer domestic partner benefits to same-sex couples.

Note: Some states require insured plans to offer domestic partner benefits.

The reasoning behind the ruling

The case was brought before the Supreme Court by 14 same-sex couples in Ohio, Michigan, Kentucky and Tennessee, who sued state officials because of their states’ bans on same-sex marriage or officials’ refusal to recognize same-sex marriages that were legally performed in other states. The charging parties said their equal protection and due process rights under the U.S. Constitution had been violated.

Federal district courts agreed with the plaintiffs, but the Sixth Circuit reversed their rulings.

As a result, the Supreme Court agreed to settle two questions:

• Does the Constitution require all states to perform same-sex marriages?
• Does the Constitution require states to recognize same-sex marriages legally performed in other states?

In a 5-to-4 decision, the High Court ruled the answer is “yes” to both questions.

The majority said marriage is a “fundamental right,” and the Constitution’s equal protection and due process clauses protect individuals from being deprived of that right.

Cite: Obergefell v. Hodges