How Will the Supreme Court Decision on Same-Sex Marriage Impact Employers and Plan Sponsors?

Julie Stich, CEBS
Julie Stich, CEBS
Director, Research at the International Foundation

On June 26, 2015, the U.S. Supreme Court ruled that states cannot refuse to license same-sex marriages or refuse to recognize those performed in other states. The case, Obergefell v. Hodges, a composite of four lower-court cases involving four states—Ohio, Tennessee, Michigan and Kentucky— has ramifications for employers, plan sponsors and workers in all states.

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This Supreme Court case is the result of a Sixth Circuit Appeals Court decision announced in November 2014 that upheld a state’s right to ban same-sex marriage. Because that decision was the first from a federal circuit appeals court to uphold such a ban, the Supreme Court took up the case. Previous federal district and appellate decisions had struck down bans as unconstitutional.

With the decision that states can no longer ban licensing same-sex marriages, the remaining states with bans must eliminate them and start issuing licenses. Also, states can no longer refuse to recognize a same-sex marriage legally performed in a different state. With this ruling, all legally married couples, both opposite- and same-sex, will be afforded the same spousal rights.

Employers and plan sponsors located in states where same-sex marriage has not been recognized or allowed will need to change employment, HR and benefits policies to comply. For example, employers offering fully insured group health plan coverage to workers will now need to provide coverage for same-sex spouses if coverage is provided to opposite-sex spouses. Access to and eligibility for other benefits, such as employee assistance programs, tuition reimbursement and bereavement and other types of leave, must be the same for all legally married couples. Any kind of spousal documentation requirements must now be the same for all. This is also true for participant enrollment forms and communication pieces. And state imputed income tax issues involving employee benefits will now be resolved.

[Related: Employee Benefits for Same-Sex Couples: The DOMA Decision One Year Later]

The upshot? Less confusion, complexity and inconsistency for employers, plan sponsors and workers. Because all legally married spouses will be treated the same, regardless of sex and state of residence, employee benefits can be provided and administered more consistently.

Stay tuned to the International Foundation for further details and analysis on this important issue.

 

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