Tag: Same Sex Spouse

Obergefell Uncertainty re: Same Sex Spousal Benefits

On June 26, 2015, the U.S. Supreme Court removed a cloud of uncertainty for same-sex couples when it ruled, in the landmark decision of Obergefell v. Hodges, that the equal protection and due process clauses of the Fourteenth Amendment require all states to issue marriage licenses to same-sex couples seeking to marry and to recognize same-sex marriages lawfully performed in other states. We previously discussed the ruling in our blog post, Same-Sex Marriage Decision: Uniformity in All States. However, as discussed below, the Obergefell ruling left at least two unanswered questions.

Retroactivity

Justice Kennedy’s opinion for the majority in Obergefell did not state whether the decision should be applied retroactively. Retroactive application could require employers to revisit their past practices in providing employee benefits to same-sex couples. To date, no guidance has been issued by the IRS or other federal agencies to assist employers in this respect. Some news outlets have reported that the Social Security Administration intends to apply the Obergefell decision retroactively, but to date no official guidance has emerged.

The retroactivity conundrum is highlighted in at least two lawsuits initiated in Federal courts over the past year that challenge employers’ denials of health benefits to the same-sex spouses of employees.

  • In Cote v. Wal-Mart Stores Inc., an employee sought repeatedly to have her same-sex spouse added to her health insurance but was denied. While Wal-Mart did extend benefits to same-sex spouses in the wake of the Windsor decision, the employee and her spouse had accumulated significant medical bills prior to Windsor. The employee is challenging Wal-Mart’s pre-Windsor denials and is seeking class-action status for the suit.

  • In Considine v. Brookdale Senior Living, an employee’s request to have her same-sex spouse added to her health plan was denied because Brookdale Senior Living did not offer health insurance coverage to same-sex spouses. After requesting briefs in mid-July on the impact of the Obergefell decision, the court recently sent the parties to arbitration based on an arbitration clause in Ms. Considine’s employment agreement.

In both of these cases the U.S. Equal Employment Opportunity Commission (“EEOC”) found probable cause that the defendants had discriminated against the plaintiffs on the basis of their gender, a theory the EEOC has advanced in such cases since 2012.

Some courts interpreting state law have already found in favor of the retroactive recognition of same-sex marriages, including a federal court in Alabama and a state court in Pennsylvania. The Alabama case involved a wrongful death suit where state law required damages to be distributed under the laws of intestate succession. The plaintiff prevailed in having his same-sex marriage recognized retroactively and received the proceeds of the suit, even though the marriage ceremony was performed in 2011 and the plaintiff’s same-sex spouse died that same year, which was before Alabama recognized same sex marriage.

In the Pennsylvania case, the plaintiff sought to receive spousal death benefits from various benefits providers, inheritance tax treatment as a spouse, and access to a jointly-owned safety deposit box following the death of her common-law same-sex spouse. Finding in the plaintiff’s favor, a state judge recognized the 2001 same-sex common law marriage despite the fact that it was not recognized under state law when celebrated, and the plaintiff’s same-sex spouse died before same-sex marriage was recognized in Pennsylvania.

Self-Insured Health Plans

Another lingering question concerns Obergefell’s effect on employers that sponsor self-insured health plans. After Obergefell, will state and/or federal anti-discrimination laws require those plans to offer benefits to same-sex spouses? ERISA generally preempts state regulation of self-insured health plans, and there is nothing in ERISA or other federal law prohibiting discrimination based on sexual orientation. Obergefell does not appear to apply. However, as noted above, the EEOC has taken the position that discrimination against an employee based on the employee’s sexual orientation equates to discrimination based on gender. The EEOC’s approach is currently being tested in the courts. In the meantime, any employer that elects not to offer self-insured medical benefits to spouses of same-sex couples risks attracting the attention of the EEOC.

Article By Jeremy T. Coffey, William B. Duff, Edward Spacapan Jr, B. Frank Thorn
Schiff Hardin LLP

© 2015 Schiff Hardin LLP

Uncertainty Follows Judicial Decision Enjoining DOL’s Same Sex Spouse Rule Change

Dinsmore Shohl LLP

Following Indiana Governor Mike Pence’s decision to sign the Religious Freedom Restoration Act (RFRA), a decision by Texas District Court Judge Reed O’Connor adds to the controversy and conversation surrounding the lesbian, gay, bisexual, transgender (LGBT) rights movement.

Opponents to the Indiana law say it will allow businesses to deny services to customers based on customers’ sexual orientation or gender identity and justify this denial based on religious beliefs. A day after Governor Pence signed Indiana’s RFRA into law, on March 27, 2015, the Arkansas legislature voted to enact its own religious freedom legislation known as the “Conscience Protection Act”, and the bill is currently before Governor Asa Hutchinson.

While the Arkansas Governor is set to consider religious freedoms and LGBT discrimination, Arkansas’s Attorney General has been battling the Department of Labor (DOL) in another issue impacting LGBT employees. On March 26, 2015, in Texas v. United States, N.D. Texas No. 7:15-cv-00056-O, Judge O’Connor granted an injunction to Texas, Arkansas, Louisiana, and Nebraska to temporarily halt the DOL’s Final Rule revising the definition of “spouse” under the Family and Medical Leave Act (FMLA).

The DOL’s Final Rule took effect on March 27, 2015 and changed the definition of “spouse” to include individuals in same-sex marriages if the marriage was valid in the place it was entered into regardless of where they live. The Final Rule reads as follows:

Spouse, as defined in the statute, means a husband or wife. For purposes of this definition, husband or wife refers to the other person with whom an individual entered into marriage as defined or recognized under state law for purposes of marriage in the State in which the marriage was entered into or, in the case of a marriage entered into outside of any State, if the marriage is valid in the place where entered into and could have been entered into in at least one State. This definition includes an individual in a same-sex or common law marriage that either:

(1) Was entered into in a State that recognizes such marriages; or

(2) If entered into outside of any State, is valid in the place where entered into and could have been entered into in at least one State.

29 C.F.R. § 825.102. This change enables eligible employees in legal same-sex marriages to take FMLA leave to care for a spouse with a serious medical condition. The Final Rule no longer looks to the laws of the state in which the employee resides but rather relies on the laws of the jurisdiction where the marriage was entered into–i.e. the place of celebration.

Texas law, similar to Ohio, does not recognize same sex marriage. Texas, joined by Arkansas, Nebraska, and Louisiana, argued that the DOL exceeded its jurisdiction by requiring them to violate the Full Faith and Credit Statute and/or state law prohibiting recognition of same-sex marriages from other jurisdictions. Texas argued that the Final Rule would require it to violate state law which prohibits it from giving any legal benefits asserted on the basis of a same-sex marriage. Judge O’Connor also relied on Section 2 of the Defense of Marriage Act (DOMA) to hold that Congress intended to preserve a state’s ability to define marriage differently than another state or jurisdiction. Finding that the Final Rule would require Texas agencies to recognize out-of-state same-sex marriages in violation of state law, Judge O’Connor temporarily halted the application of the Final Rule pending a full determination of this matter on the merits.

In these four states, Judge O’Connor’s decision prevents employees in same-sex marriages from receiving the benefits afforded heterosexual married couples until the issue is resolved through legal channels. However, employers are not prohibited from granting family leave benefits to qualifying employees to care for a loved one. Despite the decision—only applicable in four states—the Final Rule is currently in effect. For this reason, employers should proceed in accordance with the DOL’s regulation and fulfill its obligations to its LGBT employees by revising their family and medical leave policies and providing FMLA benefits to employees in legal same-sex marriages.

ARTICLE BY

Anjali Chavan
Sadhna G. True
Dinsmore & Shohl LLP

DOL Issues Final Rule Amending FMLA Definition of “Spouse” to Include Same-Sex Marriages

The U.S. Department of Labor has issued a final rule amending the regulatory definition of “spouse” under the Family and Medical Leave Act (“FMLA”).  We earlier reported on the DOL’s proposed rule to this effect, which is now final and will become effective on March 27, 2015.

The amendment changes the definition of “spouse” to include individuals in same-sex marriages if the marriage was valid in the place it was entered into regardless of where they live.  Before the new rule was issued, the FMLA and its accompanying regulations defined “spouse” as a husband or wife as recognized under the laws of the state in which the employee resides.  The new definition of spouse instead looks to the law of the jurisdiction in which the marriage was entered into and expressly encompasses same-sex married couples.  The final rule thus adopts a “place of celebration” rule rather than a “state of residence” rule for the definition of “spouse” under the FMLA.

According to the DOL, the amended regulatory definition of spouse permits “eligible employees in legal same-sex marriages [to] be able to take FMLA leave to care for their spouse or family member, regardless of where they live.”  The DOL has also suggested that the new rule will reduce the administrative burden on multi-state employers, who no longer have to consider an employee’s state of residence and the laws of that state in determining the employee’s eligibility for FMLA leave.

The new rule was prompted by the United States Supreme Court decision in United States v. Windsor, which found unconstitutional those provisions of the Defense of Marriage Act that prohibited federal recognition of same-sex marriages.

Some of the other features of the new rule include:

  • The new rule encompasses an employee in a same-sex marriage entered into abroad as long as the marriage is valid in the place it was entered into and could have been entered into in at least one state in the United States.

  • The new rule encompasses employees in a common law marriage as long as the common law marriage became valid in a state that recognizes such common law marriage.

  • An employee in a legal same-sex marriage can now take FMLA leave to care for his or her stepchild whereas before, an employee in a legal same-sex marriage could only take FMLA leave to care for his or her stepchild for whom the employee stood in loco parentis.

  • Similarly, an employee can now take FMLA to care for his stepparent who is the employee’s parent’s same-sex spouse, even if the stepparent never stood in loco parentisto the employee.

ARTICLE BY

Shira Forman
Sheppard, Mullin, Richter & Hampton LLP