 |
 |
|
|
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
 |
Future of domestic partner benefits with enactment of civil unions. |
||||||
November 2007 - Concord, NH:
This year the New Hampshire legislature enacted a civil unions law, RSA 457-A, providing for same-sex unions and entitling partners to all the rights and subjecting partners to “all the obligations and responsibilities provided for in state law that apply to parties who are joined together” in marriage. RSA 457-A:6 (Supp. 2007). This law will go into effect on January 1, 2008. How will the availability of civil unions affect domestic partner benefits offered by employers? Many employers currently offer domestic partner benefits to same-sex couples, but require heterosexual couples to marry before benefits are made available to the non-employed spouse. The justification for such policies is that current law does not recognize gay marriage or civil unions, and so in fairness domestic partner benefits are made available to same-sex couples who can demonstrate a relationship equivalent to marriage. Impact on Fully-Insured Plans that Offer Domestic Partner Benefits When the civil unions law goes into effect in January, an employer with a fully-insured benefits package will be required to provide benefits to the partner and children of an employee who has entered into a civil union, if that employer provides similar extended benefits to married employees. However, at that point another question will arise for employers who have previously provided domestic partner benefits: if an employer denies extended benefits to unmarried heterosexual couples but continues to offer domestic partner benefits to gay and lesbian couples who choose not to enter a civil union, would this expose the employer to complaints of discrimination on the basis of sexual orientation? In other words, now that state law will offer gay and lesbian couples legal status that provides rights and responsibilities equivalent to marriage, would it be discriminatory for the employer to continue to require heterosexuals to marry in order to receive benefits for his or her partner while allowing gay and lesbian couples to secure such benefits without entering a civil union? Based on the text of the laws and informal consultation with Katharine Daly, Executive Director of the New Hampshire Human Rights Commission, we have concluded that employers may indeed face claims of discrimination based on sexual orientation if they continue to offer domestic partner benefits to same-sex couples who are not civil union partners, but not to unmarried heterosexual couples. New Hampshire law prohibits discrimination based on sexual orientation in the employment context. See RSA 354-A:1 (Supp. 2007). Under the new civil unions law, both same-sex and heterosexual couples may enter into a legal union that has the same rights and responsibilities as marriage in New Hampshire. Once the civil unions law goes into effect, the ability of the couple to “marry” will no longer be the distinguishing factor between same-sex and heterosexual couples, which will leave only the sexual orientation of the couple as the distinguishing factor. Thus, offering domestic partner benefits to one set of couples and denying it to another, where the sole distinguishing factor for eligibility is sexual orientation, would be prohibited by New Hampshire’s law against discrimination. As we see it, employers with fully-insured health benefit plans who currently offer domestic partner benefits to same-sex couples are left with two options to avoid the risk of a successful claim of sexual orientation discrimination: Option 1 An employer could provide domestic partner benefits to both same-sex and heterosexual couples who have not married or entered into a civil union, but can establish they are in a committed relationship. Option 2 An employer could require that employees in same-sex relationships enter into a civil union to maintain their eligibility for domestic partner benefits. This decision may not be an easy one – especially if there are couples who enjoy domestic partner benefits now but who (for whatever reasons of their own) may be hesitant to enter into a civil union. In any event, a policy decision should be made in advance of January 1, 2008, when civil unions become available. There appears to be a consensus that, for those employers who offer domestic partner benefits and elect to require a civil union for eligibility, it is appropriate to give those employees currently enrolled in domestic partner benefits both notice of any new eligibility requirements and a period of transition to enter into a civil union before they would lose benefits (for example to the next open enrollment period under the benefits plan in question, if that time frame provides an adequate notice period). Impact on Self-Insured Plans that Offer Domestic Partner Benefits The two options available in the fully-insured context should also be available for self-insured employers as well. Self-insured plans are governed by federal law, specifically the Employment Retirement Income Security Act of 1974 (ERISA), the Defense of Marriage Act (DOMA), and the Internal Revenue Code (Code). While the interactions between federal and state law are complex and unsettled where a state has extended to same-sex couples benefits normally reserved to married heterosexual couples, it is clear that in connection with matters such as federal income tax filings and social security benefits, federal law will prevent same-sex couples in New Hampshire from enjoying “all the rights” of marriage. Moreover, under federal law, and the “preemption” provisions of ERISA in particular, employers with self-insured plans (unlike fully-insured plans where state law still applies) will not be required to offer extended benefits to those employees who enter into a civil union. However, self-insured plans may offer benefits to couples joined in a civil union. Federal law does not obstruct a self-insured employer’s decision to voluntarily provide benefits; however, as is also the case with fully-insured plans, they will not be as advantageous to same-sex couples for income tax purposes. However, self-insured employers who elect to (or already do) offer benefits to same-sex couples are still subject to New Hampshire’s prohibition on discrimination based on sexual orientation with regard to the provision of those benefits, so the concerns we have expressed and options outlined in the fully-insured context will also apply to self-insured employers. While there is more freedom in the self-insured context to tailor benefits like domestic partner plans, they still may not be provided in a discriminatory way. We hope that you find this information helpful. If you have any questions, please do not hesitate to contact Jeanine Poole, Douglas Chamberlain or another member of the Labor and Employment Practice Group. About Sulloway & Hollis: Sulloway & Hollis, P.L.L.C. is a thriving New Hampshire law firm with over 150 years of success in representing clients’ interests. We have principal offices in Concord, New Hampshire, and Portland, Maine, and regional offices in New London and Gorham, New Hampshire. WELCOME
 ||ATTORNEYS|||
|
|||||||
 |
 |