Two recent cases challenging benefit eligibility for same-sex
spouses highlight the need for employer-sponsored retirement and
welfare plans to clearly define "spouse" for
eligibility purposes. Employers may want to review their
plan documents to determine whether plan amendments are needed to
clarify benefit eligibility for same-sex spouses in light of the
upcoming ruling by the Supreme Court of the United States on the
constitutionality of the federal Defense of Marriage Act.
Two cases currently pending in the federal district courts for
the Eastern District of Pennsylvania emphasize the need for
employers to review and understand whether their employee benefit
plans clearly define "spouse" for eligibility
The case Cozen O'Connor v. Tobits was filed in
January 2011 by an employer seeking to resolve a dispute over
whether benefits under the employer's profit sharing plan
are payable to a deceased employee's surviving same-sex
spouse or parents. Because the plan document was not
clear if "spouse," for purposes of death benefit
payments, included a same-sex spouse, the deceased
employee's parents argued that the Defense of Marriage Act
(DOMA) prevents the plan from recognizing the employee's
same-sex spouse despite the fact that the couple had legally
married in Toronto in 2006. The surviving spouse argued
that DOMA does not prevent employers from respecting the marriages
of same-sex couples and providing equal benefits. The
employer has withheld death benefit payments until the case is
resolved. The court suspended action on the case in
September 2012 pending the resolution of other current legal
challenges to the constitutionality of DOMA.
Another case, Ginther et al. v. Steelworkers Health And
Welfare Plan et al., was filed in February 2013 by an employee
challenging his employer's denial of health coverage to the
employee's same-sex spouse. The
employer's health plan does not provide clear definitions
of "spouse" or "dependent," thereby exposing
the employer to eligibility claims and potential liability under
the Employee Retirement Income Security Act of 1974, as amended
In light of these recent lawsuits, and other similar cases,
employers should review how "spouse" and
"dependent" are defined under their retirement and
welfare plans. Employers that do not clearly define these
terms are vulnerable to challenges by same-sex spouses and partners
if the employer denies benefits to such spouses and
partners. In particular, employers with employees who
work (or live) in jurisdictions that have legalized same-sex
marriage should expect to see an increase in requests for spousal
benefit coverage from employees who have legally married their
same-sex partners. In addition, providing a clear
definition of spouse can help to minimize the risk of competing
claims for death benefits under the employer's retirement
plans brought by a deceased employee's same-sex spouse and
the blood relatives who otherwise may be entitled to death benefits
under the plan's default beneficiary rules.
Same-sex marriage is currently legal in nine states and the
District of Columbia. The Rhode Island legislature passed
a bill to legalize same-sex marriage on April 24, 2013, which is
awaiting the governor's signature.
DOMA is the federal law that defines marriage as between one man
and one woman for all purposes of federal law. The
Supreme Court of the United States is expected to rule on the
constitutionality of DOMA in June 2013. Pending the
outcome of the Supreme Court's ruling, employers can
attempt to rely on DOMA's definition of spouse in
administering employee benefit plans plan. If a plan is
properly drafted, the plan administrator's interpretation
of an ambiguous concept should be granted a fair amount of judicial
deference. However, the DOMA definition of spouse does
not automatically apply to an ERISA-covered benefit plan absent a
specific plan provision saying as much, and plans without a
specific definition of spouse are left vulnerable to legal
challenges. If DOMA is upheld by the Supreme Court,
employers that wish to limit benefits coverage to opposite-sex
spouses should specifically include a DOMA-like definition of
spouse in their benefit plan documents and summary plan
Given the prevalence of same-sex couples and the growing number
of states providing legal recognition of same-sex unions, employers
will be well-served to review the use of "spouse" in each
of their benefit programs to determine whether the employer intends
or is required to cover same-sex spouses and partners.
After the Supreme Court rules on DOMA, employers may want to
prepare plan amendments and implement any necessary administrative
procedures to clarify benefit eligibility for same-sex spouses and
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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