DOMA

[Cynchbeast]

Does anyone have any sample letters to advise clients of impact of DOMA ruling by Supreme Court, and ask for confirmation of owners' and employees' marital status?

[Mr. T]

How about, "Is you married?".

[Carol V. Calhoun]

My sense is that a lot of employers are waiting to see what the IRS does about retroactivity issues before issuing any kind of general letter to employees. For example, if the employer allows for pretax payment of premiums for spousal health insurance, employees can normally opt in outside of the open enrollment period only if they have had some kind of change in family status. It's not at all clear right now what you can do about an employee who has been married since 2009, but who was precluded from obtaining spousal coverage during the last open enrollment period because his marriage wasn't recognized back then.

Moreover, the kind of letter you would issue would depend a lot on what the employer has been doing before now, so there is not one size fits all "sample" letter. For example, if the employer has already been providing domestic partner benefits, it may just need to know which of the "domestic partners" are legally married so that it can straighten out their taxes. The letter it would need would be very different from the kind of letter needed if the employer is just beginning to provide spousal coverage to employees in same-sex marriages. And of course, some employers may still not want to provide coverage to same-sex spouses. While they have to provide certain rights (e.g., the QJSA and QPSA in a qualified pension plan), it is not clear that health insurance coverage must be extended to same-sex spouses even if the employer otherwise extends such coverage to spouses. If the employer is attempting to do the minimum required by law, it may not want to issue any kind of general letter to employees until it figures out exactly what the requirements are.

[My 2 cents]

... While they have to provide certain rights (e.g., the QJSA and QPSA in a qualified pension plan), it is not clear that health insurance coverage must be extended to same-sex spouses even if the employer otherwise extends such coverage to spouses...

Please take note that at a recent ABA conference, an IRS associate chief counsel for employee benefits pointed out that the tax code does not mandate spousal coverage at all, and that the sponsors can (except for protected classes like race or gender) carve out whomever they choose. Speaking for himself at the time, he did point out that offering health insurance coverage to opposite-sex spouses but not same-sex spouses invites litigation, but he then said that they would not be litigating over the tax code.

[Carol V. Calhoun]

@My 2 Cents: Yes, this is what I meant. The Code (even with Obamacare) does not require covering spouses, and does not contain any prohibition on favoring some spouses over others. In some instances, depending on the factual situation, excluding same-sex spouses may result in prohibited discrimination (e.g., in favor of highly compensated employees, or based on age, race, etc.). But outside of those situations, the question is going to be a) whether there is a state law prohibiting discrimination based on sexual orientation, and if so, whether it is preempted by ERISA, and b) in the case of a governmental employer, whether the Fourteenth Amendment prohibits discrimination based on sexual orientation.

For anyone who is interested, I have a chart of what changes DOMA requires (divided into sections for ERISA-covered employers, governmental employers, and church employers) at this link.

[My 2 cents]

First, everyone should look at that chart. It is really well done. But the law in this area is in a state of flux, and the chart focuses on the current state of the law. Certainly, many states do not currently allow same-sex marriages and do not recognize same-sex marriages performed elsewhere, but how long can that be expected to continue? A same-sex couple that had been legally married in Massachusetts but who now reside in Pennsylvania has filed a suit against the state of Pennsylvania saying that the Pennsylvania laws that call for them to be denied the status of marriage for state law purposes (such as tax status, ownership laws and all the other laws that provide rights to opposite-sex legally-married couples but not to them) is unconsitutional. What are their chances of prevailing (assuming they are williing to fight long and hard enough)? Justice Scalia (who, let there be no doubt, clearly disapproved of the DOMA decision) explicitly pointed out in his dissent that the same arguments used to determine that DOMA, as a federal law, is unconstitutional can, virtually without modification, be applied to negate any similar state laws. If you haven't seen his dissent, he quoted major parts of the majority's DOMA decision, replacing the word "federal" with the word "state" throughout, noting that the results were as logical and coherent as they were in the DOMA decision (although it was clear that he meant it as a warning or reductio ad absurdum). Will lower courts throw out all state laws prohibiting recognition of same-sex marriages performed in jurisdictions allowing them? If it goes to the Supreme Court, will their ruling differ materially from the DOMA decision? Will states not permitting legal marriages between same-sex couples even be allowed to continue doing so? A lawsuit has been filed in Mississippi seeking to require that state to allow same-sex couples to marry. How will that suit ultimately fare?