As a tax expert at Ernst & Young, Chris Crespo and her partner began receiving same-sex domestic partnership benefits through work in 2002. Now, Crespo is helping the accounting firm with a new program that aims to accommodate the Supreme Court decision legalizing same-sex marriage, albeit in a way that may seem puzzling to some: by extending domestic partner benefits to opposite-sex couples as well.
“It’s more of a gender [equality] issue than a sexual orientation issue,” Crespo, who is now the company’s inclusiveness director, says of the initiative rolling out this week. “We wanted to make our benefits equitable.”
Since the summer’s
Obergefell v. Hodges decision made same-sex marriage the law of the land, public and private sector employers have struggled with its legal and financial implications. Many companies – two-thirds of Fortune 500 firms, according to the Human Rights Campaign – offered health care benefits to same-sex domestic partners before the high court decision, on the theory that it wasn’t fair to deny marital benefits to people not legally allowed to wed. But now that gay and lesbian couples can make their unions official, employers are grappling with how to adjust.
While some companies and government entities have told same-sex couples to put a ring on it if they want to continue receiving couples’ benefits, Ernst & Young decided to expand, offering health insurance and other benefits to all employees in a demonstrably committed relationship. “We’re not going to tell you how to define your family,” says Crespo, who is raising 17-year-old triplets with her partner.
On a purely legal basis, firms are eager to avoid a lawsuit charging them with unequal treatment of employees. From a business perspective, they want both to save money on the cost of benefits and be able to offer the type of package that lets them recruit top talent.
Underlying it all is a recognition that the American family has evolved and diversified, with same-sex parents, custodial grandparents, stepchildren and unmarried couples of any sexual orientation coming into work each day.
Plaintiff Jim Obergefell holds a photo of his late husband John Arthur as he speaks to members of the media after the U.S. Supreme Court handed down a ruling regarding same-sex marriage on June 26 in Washington, D.C.
“We don’t live in a world where everybody has a picket fence, a dog and two kids” raised by opposite-sex parents, with the woman staying home with the children, says Marc Siegel, a labor lawyer in Chicago who has represented lesbian, gay, bisexual and transgender clients.
Some of California-based employment lawyer Sheldon Blumling’s corporate clients offer benefits covering grandchildren, for example, if the grandparents are the primary caregivers. “We understand that not everybody’s in the same boat, and [clients are] happy to make benefits available to a lot of different relationships,” says Blumling, a partner with Fisher & Phillips.
Research by the nonprofit International Foundation of Employee Benefit Plans shows that indeed is the case: More than a tenth of employer respondents said their health care benefit plans covered grandchildren, while nearly two-thirds covered stepchildren and nearly half covered foster children or wards. “Employers are doing it because they wanted to be equitable, retain good employees and respect all kinds of families,” says Julie Stich, the group’s director of research.
Still, the question of whether to continue benefits for same-sex domestic partners who decline to marry is dividing corporate America, the foundation’s early research shows. A separate study by the group this summer found that 30 percent of the companies responding planned to phase out domestic partner benefits, while 70 percent planned to continue them. Stich says the group has no update on which companies have followed through on their plans.
Labor lawyers note there are practical considerations as well. Companies don’t want to force any couples into shotgun weddings so people can keep their health insurance, they say. And from a labor-versus-management perspective, it’s hard to take away a benefit from someone already receiving it.
“We’re still in the transition phase” after the high court decision, says Scott Cooper, who leads the labor and employment group at law firm Blank Rome in Philadelphia. But from what Cooper has seen among his own clients, “it is clearly now a pattern that companies are looking at this and making the move away from offering that kind of coverage.”
The key, employment and labor lawyers say, is to make sure what’s being offered is equal irrespective of a relationship partner’s gender.
“They’re worried that if they keep same-sex partner benefits, there’s a pretty good argument that opposite-sex partners are being discriminated against,” says Memphis, Tennessee-based lawyer David Thornton, who specializes in employee benefits and benefits litigation for the firm Bass, Berry & Sims.
The State Department addressed the equality issue directly in October, announcing it would be taking away certain perks offered to recognized same-sex partners. Since foreign service officers have special needs – especially if they are in danger zones – qualified family members are given access to things like medical evacuations and security training. (Unmarried same-sex couples were never extended pension, health care or other such benefits by the federal agency.)
Now that gays and lesbians can marry, the State Department is going to start phasing out those provisions for unmarried same-sex partners. Some private companies began phasing out domestic partner benefits on a state-by-state basis even before the Obergefell
ruling, as states extended marriage equality to gays and lesbians.
The legal landscape indeed can be tricky for LGBT employees and same-sex couples, notes attorney Susan Manning, author of a friend-of-the-court brief supporting the plaintiffs in the Obergefell case. “In numerous states, there are no employment protections for LGBT people. You can be fired in many states for being gay, lesbian, bisexual or transgender,” adds Manning, who works at Morgan, Lewis & Bockius in the District of Columbia.
Likewise, there is no federal law protecting LGBT people from job discrimination, although the Equal Employment Opportunity Commission has sought to prohibit such practices under Title VII of the Civil Rights Act of 1964, which bars discrimination on the basis of a person’s sex, among other characteristics.
Meanwhile, requiring same-sex partners to get married if they want to continue receiving benefits could pose problems for couples in conservative parts of the country, notes former Fulton County, Georgia, Superior Court Chief Judge Cynthia D. Wright, now a partner at the Atlanta-based firm Boyd Collar Nolen & Tuggle. Some in a same-sex relationship might not even want a partner’s photo on the desk to avoid harassment, she notes.
That was part of the equation at Ernst & Young, Crespo says. “Many LGBT couples live in fear of being outed in their communities, and legal marriage actually doesn’t change that,” she says.
The biggest reason companies may choose to extend benefits to unmarried opposite-sex couples is the same reason they offered them to same-sex couples in the first place, experts say: recruitment and retention of good workers. “Most employers aren’t trying to make a political statement at all. They want to attract quality employees,” Thornton says.
The cost, experts say, is not that high. Since same-sex couples are generally less likely to incur certain medical costs such as pregnancy and childbirth, Blumling says, there is an argument that they are cheaper to cover than married, opposite-sex couples.
At Ernst & Young, couples seeking benefits must meet the same standards regardless of the type of relationship they’re in, she says. While there is no minimum for time together, couples must demonstrate a financial interdependence and a commitment to staying together long-term, Crespo says.
The goal is to make all of Ernst & Young’s employees feel accepted and free from distractions that interfere with creativity and productivity.
“You can be yourself and breathe,” Crespo says.