Biz Rules: Recognizing Same-sex Marriage

By Beau Denton January 28, 2014

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Last June, the U.S. Supreme Court overturned a key part of the Defense of Marriage Act (DOMA), ruling that it is unconstitutional to deny the federal benefits of marriage to same-sex couples. How the ruling would apply to states like Florida that do not recognize same-sex marriage was murky. Then in September, the IRS announced a “state of celebration” rule (in contrast to the “state of residency” standard), which states that, if a same-sex couple is married in a state that allows same-sex marriage, private employers must recognize that marriage, even in states that do not.

“It’s a very practical, cut-and-dried rule,” says Edward Kim, an employee benefits attorney at Williams Parker in Sarasota. The application of the new rule is divided into two types of benefits: retirement (like 401Ks and pensions) and welfare (like health care benefits). For retirement plans, the rule is mandatory. Every private employer that sponsors a retirement plan must treat same-sex married couples the same as opposite-sex married couples if those couples were married in a state that allows same-sex marriage. For welfare plans, the rule is optional; employers can choose whether or not to recognize same-sex marriages.

Florida employers, however, might open the door for a future discrimination lawsuit by choosing not to recognize a same-sex couple for a welfare plan. “That’s where the fight’s going to be,” says Kim. “Any variation of providing benefits will likely be considered a form of discrimination, so the safer route would be to observe the same rule as the retirement plan.”   ■ By Beau Denton

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