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Friday, July 12, 2013

Major Issues Employers Need to Deal With In Light of DOMA Repeal

In its recent ruling regarding the Section 4 of the Defense of Marriage Act (DOMA), the U.S. Supreme Court has apparently opened the door to lesbian, gay, bisexual and transgender employees across the country.

However, from an employment perspective, while the decision has finally addressed few questions, many issues remain unanswered.

Here are some of the issues that employers, including those who are in states that do not acknowledge same-sex marriage, need to deal with in light of the DOMA repeal:

•    Family and Medical Leave Act (FMLA)

In states that acknowledge same-sex marriage, the definition of “spouse” will definitely include a spouse of the same-sex couple.

Meanwhile, in states that do not recognize same-sex marriage, unfortunately, FMLA will not apply to same-sex marriages. Nevertheless, many believe that this issue will be a challenge in court in the future for states that do not have marriage equality statutes like Alabama.

•    Affordable Car Act (ACA), Cobra and Health Insurance Portability and Accountability Act (HIPAA)

These statutes make several references to “spouses” and “dependents.” Under ACA the “spouse” is excluded in ACA’s definition of “dependent”. Thus, the issue here is in the event that the insurance policy’s definition of “spouse” whether it would include same-sex marriage or not.

Other than that, which law applies in a case where a same-sex couple who are legally married in a state that acknowledges same-sex marriage moved to Alabama for employment? Should the federal law prevail? Or will the state law rule?

In policies that do not require coverage for spouses, exclusions would probably apply to both opposite-sex marriage and same-sex marriage.

Moreover, under HIPAA, marriage is a qualifying “change in status”. Thus, employees are allowed to immediately add a new spouse to a health plan if it covers spouses. Now, the question is, will this “change in status” apply to same-sex marriage employed in states with no marriage equality statutes even though they were legally married that recognizes same-sex marriage.

•    Employee Retirement Income Security Act (ERISA) and Employee Benefit Plans

This is a very vague area. Plans define “spouse” and the same will need to be assessed after state and federal law. Now, the confusion here will be upon the amendment of plans. Will changes need to be retroactive? Most probably, litigation will be a good solution over this matter.

•    Federal Taxes

From now on, same-sex marriage couples can now enjoy the same federal tax benefits that opposite-sex marriage spouses used to enjoy. They can now take advantage of a tax-free status of health insurance benefits and inheritance. Also, you can expect same-sex marriage spouses to file amended federal returns, if they were lawfully married as well as to seek joint filing status if they desire.

•    Social Security Benefits

The DOMA repeal permits same-sex marriage survivors to enjoy the same federal benefits available to opposite-sex marriage survivors.

•    Employment Non-discrimination Act

Although not yet specifically addressed, but the a proposed bill banning employment discrimination on the basis of gender identity of sexual orientation is likely to become a law in the future. Therefore, employers have to learn to adopt the same by prohibiting LGBT discrimination in the workplace.

So far, a Los Angeles workplace discrimination lawyer believes that the recent DOMA repeal is just a portion of a significant change that will impact both employers and the employees in the future to come.

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