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Considerations for Employers in Light of Supreme Court's Ruling Requiring All States to Recognize Same-Sex Marriage

June 29, 2015

Considerations for Employers in Light of Supreme Court's Ruling Requiring All States to Recognize Same-Sex Marriage

June 29, 2015

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Although the Obergefell decision did not directly address issues of employment law, it may have a wide-ranging, though mainly indirect, impact on many employment policies and practices.

In Obergefell v. Hodges, the U.S. Supreme Court held, in a 5-4 opinion, that the Fourteenth Amendment to the Constitution requires that all states license marriages between two people of the same sex and recognize a marriage between people of the same sex when their marriage was lawfully licensed and performed out of state. The social implications of the Court's opinion are significant; however, the opinion may also impact, directly and indirectly, employers' employment practices and employee benefit plans.


Obergefell arose from cases filed in Michigan, Kentucky, Ohio and Tennessee brought by 14 same-sex couples and two men whose same-sex partners are deceased, challenging those states' definition of marriage as a union between one man and one woman. Each district court that heard the underlying cases ruled in their favor, but the Sixth Circuit Court of Appeals consolidated the cases and reversed.

In reversing the Sixth Circuit, the Court held that the Fourteenth Amendment requires a state to license a marriage between two people of the same sex. In reaching this holding, the Court found that the fundamental liberties protected by the Fourteenth Amendment's Due Process Clause extend to certain personal choices central to individual dignity and autonomy, including intimate choices defining personal identity and beliefs. The Court also found that the right of same-sex couples to marry is derived from the Fourteenth Amendment's guarantee of equal protection. As a result, the Court concluded 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.

As a result of Obergefell, same-sex couples may now exercise the fundamental right to marry in all states, and therefore, as the Court ruled, there is no lawful basis for a state to refuse to recognize a lawful same-sex marriage performed in another state on the grounds that the couple are of the same sex.

Employment Law Issues

Although the Obergefell decision did not directly address issues of employment law, it may have a wide-ranging, though mainly indirect, impact on many employment policies and practices.

Equal Employment Opportunity

Many state and local anti-discrimination laws include "marital status" as a protected class. Under the reasoning of Obergefell, same-sex marriages now fall within that protected status, such that employers cannot treat differently, on the basis of marital status, an employee of a same-sex marriage than an employee in an opposite-sex marriage, or an unmarried employee.

Although many state and local anti-discrimination laws include "sexual orientation" as a protected class, this decision does not provide a direct basis for prohibiting discrimination on that basis in jurisdictions that do not already do so.

Leave of Absence Policies

Employers will recall that in February 2015, the U.S. Department of Labor announced regulations to provide that the term "spouse" in the federal Family and Medical Leave Act (FMLA) means the person to whom an individual is married based on the law of the jurisdiction where the marriage occurred (known as the “place of celebration” rule). As the Court has now ruled in Obergefell that all states must permit and recognize same-sex marriage, the meaning of "spouse" under the FMLA will be interpreted to include spouses of a same-sex marriage in any state.

In light of this decision, state and local leave of absence laws may be amended or interpreted to mean that leave to care for a "spouse" includes a same-sex spouse.

Where an employer's leave of absence policy permits employees to take leave to care for a "spouse," this decision provides a basis for interpreting "spouse" to include same-sex spouses as well as opposite-sex spouses.

Other Employment Policies

Employers may also want to revisit other employment policies that address a "spouse" of an employee.

By way of example, a confidentiality policy may prohibit employees from disclosing proprietary business information, but provide an exception for an employee to disclose such information to his or her "spouse."

Similarly, a bereavement leave policy may permit an employee to take leave for the death of a "spouse" or the relation of a "spouse."

As another example, a nepotism policy may provide certain parameters for the hiring of a "spouse" of an employee.

Accordingly, employers may consider reviewing their equal employment opportunity, leave of absence and other employment policies to address protections for employees on the basis of marital status and sexual orientation.

Employee Benefits Issues

Following the Supreme Court’s 2013 opinion in United States v. Windsor—which held section 3 of the Defense of Marriage Act (DOMA) that excluded a same-sex partner from the definition of "spouse" to be unconstitutional—same-sex couples have had the full range of marital rights and benefits in all areas of federal law, including in the provision of employee benefits. The implications of Windsor were significant, but its impact was limited to rights derived from federal law.

Obergefell now expands upon Windsor by removing the ability of states to refuse to license a marriage between same-sex couples or to recognize a marriage between a same-sex couple that was lawfully licensed and performed out-of-state. Therefore, it is anticipated that employers in states that previously did not license or recognize same-sex marriages will experience an increase in the number of employees who are married to a spouse of the same sex. From a plan perspective, whether that plan is a retirement plan (such as a 401(k) plan) or a health and welfare plan (such as medical coverage), such employees will be treated the same as any other married employee.

Employers will no longer have any burden with respect to ensuring that the same-sex marriage was valid in the jurisdiction in which it was entered, as all states must now license same-sex marriages. This will likely ease the administration of employee benefit plans, which previously were required to confirm that the marriage was able to be licensed in the state of ceremony.

In addition, employers may need to amend their payroll practices with respect to the treatment of same-sex couples from a state and local tax perspective due to the fact that state and local laws may no longer refuse to recognize same-sex marriage. Additional guidance is anticipated from jurisdictions where such changes are necessary.

Windsor provided the impetus for change with respect to the employee benefit plans sponsored by an employer, and therefore, employers should be prepared for the Obergefell decision and the likely increase in employees who are part of a same-sex marriage.

Although not directly related to the decision, Obergefell may also prompt employers to revisit the provision of benefits to domestic partners. Since same-sex marriage must now be recognized in all states, it is also likely that this decision will continue the movement of employers to drop health coverage for unmarried employees' domestic partners of either sex—due to the fact that those individuals are now able to marry in all states regardless of sexual orientation. Some surveys have suggested that more than one-fifth of large employers will drop health coverage for domestic partners, but the true impact remains to be seen.

About Duane Morris

Attorneys in the Employment, Labor, Benefits and Immigration practice assist employers with respect to the review and revision of employment policies and the treatment of benefits provided to spouses, including same-sex spouses, under tax-qualified plans, such as retirement plans, health and welfare plans and section 125 or cafeteria plans.

The Duane Morris Institute is holding a webinar on July 21, 2015, that will analyze this case and what it means for employers. Webinar Registration.

For Further Information

If you have any questions about this Alert, please contact any of the attorneys in our Employment, Labor, Benefits and Immigration Practice Group or the attorney in the firm with whom you are regularly in contact.

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.