United States: So Same-Sex Marriage Is Legal … Now What? Important Decisions Employers Face Now

In Obergefell v. Hodges, the U.S. Supreme Court held that the 14th Amendment to the Constitution requires all 50 states to license marriages between same-sex couples and to recognize same-sex marriages performed out-of-state. The Court issued its historic decision in Obergefell on June 26, 2015, two years to the day of its prior landmark gay rights decision, U.S. v. Windsor. In Windsor, the Court struck down portions of the federal Defense of Marriage Act (DOMA) preventing the federal government from recognizing a same-sex couple's marriage, even when the marriage was legal in the couple's home state.

In a 5-4 decision, the Obergefell Court reversed the 6th Circuit's earlier ruling upholding same-sex marriage bans in Kentucky, Michigan, Ohio, and Tennessee. Writing for the majority, Justice Kennedy, joined by Justices Breyer, Ginsburg, Kagan, and Sotomayor, found that the right to marry is a "fundamental right inherent in the liberty of the person, and under the Due Process and Equal Protection Clauses of the Fourteenth Amendment couples of the same-sex may not be deprived of that right and that liberty."

Expanding Windsor's Impact

As a result of the Supreme Court's ruling in Windsor, both same-sex spouses and opposite-sex spouses must be treated as "spouses" for purposes of the federal Internal Revenue Code (the Code) and other federal laws. Accordingly, employers must treat same-sex spouses and opposite-spouses equally with respect to survivor benefits under qualified retirement plans. Obergefell further underscores Windsor's impact on plans and programs governed by the Code.

Unlike qualified retirement plans, however, the terms of health and other welfare benefit plans generally are not governed by the Code, and so were not specifically affected by the Windsor decision. Likewise, neither Windsor nor Obergefell explicitly require an employer to provide comparable benefits to same-sex spouses. Nevertheless, the Supreme Court's decision to level the marriage playing field in Obergefell should spur employers to review their welfare benefit plans' spousal benefits and to ask themselves some important questions.

Should Employers Offer Spousal Coverage to Their Employees' Same-Sex Spouses?

The Supreme Court's holding in Obergefell was limited to whether gays and lesbians have a fundamental, Constitutional "right to marry." The Court did not, however, find that laws discriminating on the basis of sexual orientation are entitled to any sort of "heightened scrutiny" or skepticism when reviewed by a court. As a result, Obergefell does not require employers to treat the same-sex spouses of their employees the same as opposite-sex spouses with respect to the provision of health and welfare benefits.

This means employers are generally free to decide whether to offer medical coverage (or any other welfare benefits) to their employees' same-sex spouses. Following the Windsor decision, many employers elected to do just that, and provided equal benefits to the same-sex spouses of their employees in order to lessen the administrative burdens of providing domestic partner benefits (see below).

Issues to Consider. Employers that are not yet providing health coverage to same-sex spouses will likely want to revisit the issue in light of the Obergefell decision, keeping in mind the influence of the following factors:

  • State Insurance Law Requirements. Most self-funded health insurance plans sponsored by private employers are governed solely by ERISA. Neither ERISA nor any other federal law requires a private employer to provide health care coverage to its employees' spouses (or even to its employees, for that matter, though there may be economic reasons for the employer to do so). As a result, private employers sponsoring self-funded health benefit plans are not required to provide spousal coverage to their employees' same-sex spouses.

    Like self-funded plans, fully-insured health care coverage private employers purchase from insurers is governed by ERISA. In addition, however, such coverage is also subject to the requirements of state insurance laws. Such laws may require insurers to treat all "spouses" — both same-sex and opposite-sex — the same for health insurance coverage purposes, along with other coverage requirements. Employers offering their employees fully insured health coverage in such states must therefore offer their employees' same-sex spouses the same health care benefits offered to their employees' opposite-sex spouses.

    Because these sorts of state insurance laws are preempted by ERISA, they will not apply to a private employer's self-insured health plan. They may, however, apply to self-insured health plans sponsored by churches or state governmental entities, since those plans are exempt from ERISA and its preemption protections will not apply.
  • Possible Discrimination Concerns. As discussed above, the Supreme Court based its decision in Obergefell only on the proposition that the Constitution grants gays and lesbians the fundamental right to marry. The Court did not address whether laws discriminating on the basis of sexual orientation are entitled to a heightened level of judicial scrutiny.

    Although the Supreme Court has yet to address whether offering health coverage only to opposite-sex spouses constitutes impermissible discrimination, some state laws may prohibit employers from discriminating with respect to the provision of employee benefits. While ERISA likely would preempt the application of such lawsuits to a self-funded health plan sponsored by private employers, an employer facing such an action, regardless of its merit, will likely still incur significant time, money, and good will defending against it. Employers operating in states with these sorts of anti-discrimination laws may elect to offer spousal benefits to their employees' same-sex spouses simply to avoid any possible claims.
  • Employee/Public Relations Issues. Recent years have seen an unparalleled increase in national support for gay rights and marriage equality. As a result, employers failing to provide equal benefits to the same-sex spouses of their employees may risk public backlash (e.g., boycotts, social media blitzes, etc.) for that decision. For instance, the past few years have seen boycotts threatened against states attempting to adopt statutes purporting to protect religious freedoms (e.g., Arizona, Indiana), as well as against companies and organizations viewed as anti-gay (e.g., Chick-fil-A, Dolce & Gabbana, the Boy Scouts of America). In certain industries and commercial segments, failing to provide all employees with equal benefits, or to otherwise promote a diverse work environment, may negatively affect an employer's ability to recruit and retain top talent.

Administrative Concerns. Employers electing to provide health coverage to the same-sex spouses of their employees as a result of Obergefell (as well as those already providing such benefits) should review their administrative procedures and plan documentation to ensure they are consistent with the employer's overall benefits strategy. For instance, if the employer does not require employees in opposite-sex marriages to present their marriage licenses to prove their marital status, employees in same-sex marriages should not be required to do so either. Further, any requirement for proving marital status should be set forth clearly in the plan's governing documents (formal plan document, summary plan description, etc.).

International Employees. Deciding whether to offer health care benefits to their employees' same-sex spouses may be further complicated for employers with international operations. Some countries where the employer operates may not recognize same-sex marriages, may place restrictions on such unions, or may ban them entirely. Employers in that situation should consider how benefits will be provided to the same-sex spouses of employees transferred to such countries, especially if employees in those countries receive benefits through health plans governed by those countries' laws. If an employee's same-sex spouse cannot legally be covered under such plans, the employer will need to consider alternate methods for providing health coverage to that individual.

Dropping Spousal Coverage Entirely. As an alternative to offering coverage to same-sex spouses, some employers may consider dropping spousal benefits entirely. While some employers may have ideological or religious concerns about offering benefits to their employees' same-sex spouses, others may have financial reservations. Before dropping spousal coverage, employers in the latter group should weigh the likely cost savings achieved by dropping all spousal coverage (for both same-sex and opposite-sex spouses) against the potential impact doing so may have on their public relations and marketing efforts, as well as on their ability to recruit and retain qualified employees.

Should Employers Continue to Offer Domestic Partner Coverage?

The Historic Rationale for Domestic Partner Coverage. Before marriage equality efforts gained momentum in the United States, many employers offered domestic partner health benefits to the same-sex partners of their gay and lesbian employees. Although an employer's domestic partner coverage might have provided its gay and lesbian employees' same-sex partners with the same health benefits as opposite-sex spouses received, the gay and lesbian employees did not receive the same tax benefits for that coverage their straight counterparts did. While coverage for opposite-sex spouses could be provided to straight employees tax-free, a gay or lesbian employee had to include the cost of domestic partner coverage in his or her gross income unless the employee's domestic partner qualified as his or her "dependent" for tax purposes.

Reasons to Discontinue Domestic Partner Coverage. Some employers do permit unmarried, straight employees to obtain domestic partner coverage for their opposite-sex partners. Most employers, however, offered domestic partner coverage because their gay and lesbian employees could not legally marry their partners. Following the Supreme Court's decision in Obergefell, that is no longer the case, and many employers that historically offered domestic partner coverage are revisiting the decision.

Continuing to offer domestic partner coverage means continuing administrative challenges for the employer's human resources staff. In addition, as noted above, the cost of domestic partner coverage must be included in an employee's income (and is subject to federal taxation) unless the employee can treat his or her domestic partner as a tax dependent. Making that determination can be time-consuming, and typically requires the employer to rely on the employee's certification that his or her domestic partner is actually a tax dependent. If the employee is incorrect in that certification, the employer could be subject to penalties for failing to report and withhold.

In addition to the issues surrounding the determination of whether an employee's domestic partner is the employee's tax dependent, the employer's domestic partner policy may require employees to provide other forms of proof and documentation (i.e., proof they are in a "committed relationship" or are financially interdependent) to prove the validity of their domestic partnership. Employees seeking health coverage for their opposite-sex spouses are not typically required to provide this sort of information. The employer's human resources staff will be tasked with reviewing any such documentation and determining its validity.

Given the administrative headaches associated with providing it — as well as the fact that the primary reason for offering the benefit no longer exists after the Court's decision in Obergefell — many employers may now be eager to drop their domestic partner coverage. Before doing so, however, employers should ask themselves whether domestic partner coverage is such an effective recruiting/retention tool that the benefits of offering such coverage outweighs the associated administrative hassles. The answer to this question may depend on the employer's industry, the types of individuals it seeks to employ, and whether it offers domestic partner benefits only to its gay and lesbian employees or to all its employees.

Transition Issues. If after weighing the pros and cons of offering domestic partner benefits, an employer elects to discontinue that coverage, it will need to determine how best to communicate its decision and transition affected individuals to other coverage. As part of this process, such employers should consider the following:

  • Will the employer offer a transition period before dropping its domestic partner coverage to allow employees sufficient time to marry their domestic partners? If so, how long will the period be?
  • Will the employer permit current employees to continue domestic partner coverage for their partners under some sort of "grandfather" policy, while offering only spousal coverage to new employees?
  • If eligibility/type of benefits available is based on the length of an employee's marriage, will the employer count periods during which the employee was part of a domestic partnership for this purpose?
  • Will the employer continue domestic partner coverage for older employees who might lose Social Security or other retirement benefits if they marry?


The Supreme Court's decision in Obergefell recognizes the fundamental right of gay and lesbian couples to marry. Despite Obergefell's historic implications, the decision does not require employers to offer their employees' same-sex spouses benefits comparable to those they offer to their employees' opposite-sex spouses. Nevertheless, by legalizing same-sex marriage throughout the United States, Obergefell has provided employers with an excellent opportunity to revisit their current benefits policies. Employers that have not already done so should consider whether now is the time to extend health care coverage to their employees' same-sex spouses. In addition, employers currently offering domestic partner coverage should revisit that decision to determine whether it still makes sense post-Obergefell.

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.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


From time to time Mondaq may send you emails promoting Mondaq services including new services. You may opt out of receiving such emails by clicking below.

*** If you do not wish to receive any future announcements of services offered by Mondaq you may opt out by clicking here .


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.