On June 26, 2015, the Supreme Court of the United States (SCOTUS) delivered a landmark ruling in theObergefell vs. Hodges, Tanco vs. Haslam, DeBoer vs. Snyder, and Bourke vs. Beshearcase cases (the case). The case, heard on April 28, 2015, challenged state bans on same-sex marriage. Specifically, the case addressed two issues:
1) Does the Fourteenth Amendment require a state to license a marriage between two people of the same sex?
2) Does the Fourteenth Amendment require a state to recognize a marriage between two people of the same sex when their marriage was lawfully licensed and performed out-of-state?
Jim Obergefall is the Ohio man whose name will be remembered in the ruling, although 32 couples were co-plaintiffs in this case. He married his partner in Maryland. His husband died soon after. His marriage was not valid in the state of Ohio and therefore Obergefall was not named as a spouse on his death certificate. This ruling would mean that not only would Obergefall’s marriage, performed and legally recognized in Maryland, would also have to be recognized in all other states. In addition, this decision means that all states within the United States must allow same-sex couples the ability to marry, just like their opposite-sex counterparts. In essence, the answer to both questions raised in this case (listed above) is yes.
It was expected that Justice Kennedy would be the deciding vote in this case. Justice Kennedy authored the last three landmark rulings expanding the rights of same-sex couples, including the 2013 Windsor opinion that struck down a key component of the Defense of Marriage Act (DOMA) with the same 5-4 split in the court. The decision in the Windsor case provided same-sex spouses the ability to access all federal rights provided to opposite-sex spouses. Left open after that ruling was whether or not states could continue to deny same sex couples the right to marry.
Traditionally, states have the authority to determine who and under what terms individuals can marry in its state. Massachusetts was the first state to legalize same-sex marriage in 2003. It took another ten years for the next 12 states to follow suit leading up to the Windsor case. At the time of the Windsor decision, only 17 states permitted same-sex marriage. Last year, following many federal court decisions overturning state bans on same-sex marriage, that number went up to 37. But only the SCOTUS had the authority to force all states to remove the ban. And, today they did.
Justice Kennedy, writing for the majority joined by the other four liberal justices, Justices Breyer, Kagan, Ginsberg, and Sotomayor, stated “their [same-sex couples] hope is not to be condemned to live in loneliness, excluded from one of civilization’s oldest institutions. They ask for equal dignity in the eyes of the law. The Constitution grants them that right.”
Each of the four conservative Justices wrote their own dissenting opinions, including Chief Justice Roberts, Justices Alito, Scalia, and Thomas. Chief Justice Roberts stated in his opinion that the decision grants a new benefit that is not provided for in the Constitution. “If you are among the many Americans—of whatever sexual orientation—who favor expanding same-sex marriage, by all means celebrate today’s decision. Celebrate the achievement of a desired goal,” he wrote. “Celebrate the opportunity for a new expression of commitment to a partner. Celebrate the availability of new benefits. But do not celebrate the Constitution. It had nothing to do with it.” He argued that whether same-sex marriage is right or wrong is a question for the legislatures and not the courts.
Applicability to Employers, Human Resources & Employees
- Same-sex couples that are legally married will be entitled to the same treatment as their opposite-sex counterparts under Federal, and now state law. Plan sponsors and carriers must now define “spouse” to include same-sex spouses as eligible spouses, regardless of the state in which the insurance contract is written or the employer or their employees reside
- Employers must be aware of same-sex, domestic partner, and civil union laws within the state(s) they do business. This is important in particular for taxation purposes. This ruling will result in changes to laws related to same-sex spouses in the coming months for states that have bans on same-sex marriage
- Imputed income collected for same-sex spouses in states that did not recognize them under the state tax code will not likely be affected due to this ruling, absent subsequent guidance to the contrary
- Pursuant to the Windsor SCOTUS decision in June 2013, same-sex spouse’s benefits are not taxed for federal income tax purposes. Now, same-sex spouse’s benefits will not be taxed for state tax purposes either, regardless of the state they reside in (once state tax codes are revised)
- The SCOTUS ruling affects only those employers in states that have bans on same-sex marriage
- California registered domestic partners, as well as all other states that have registered domestic partner or civil union laws remain unaffected by the U.S. Supreme Court decision, in addition to states that already recognize same-sex spouses
Employers with employees that are in same-sex marriages should be treated equally as their opposite-sex counterparts, with all of the same federal, and now state, legal rights and benefits. In the coming months, if employers operate in any states that previously banned same-sex marriage, employers should ensure their plan documents and plans are modified (if applicable) to include same-sex spouses. In most cases, same-sex spouses were most likely included in the definition of “spouse” in plan documents and any corresponding documents. Employers should ensure their payroll systems are modified to no longer tax same-sex spouses for their health coverage for state and federal income tax purposes.
For further review of the oral argument transcripts and the SCOTUS decision, go to:
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