Go to Top

Cheering The End Of Domestic Partner Benefits

The truest test of the success of any accommodation to produce equal rights is the moment it becomes unnecessary.

Not long ago, companies across America opened their employee benefit programs to unmarried same-sex couples because those couples did not have the option to marry. Now in three-quarters of the country, that is no longer true. Soon marriage may be equally open to couples throughout America, depending on the Supreme Court’s ruling on the subject next month.

The spread of marriage equality has all sorts of ramifications. One such change? Many employers are tightening their health coverage policies.

The Wall Street Journal recently reported that some employers, including Delta Air Lines and Verizon, have begun to phase out same-sex domestic partner health benefits for employees in states where same-sex marriage is legal. Companies are generally notifying employees that domestic partners will need to wed within a certain window of time in order to keep their existing benefits.

“The main idea is to make things fair for everyone,” Verizon spokesman Ray McConville told The Journal.

About one-third of private and public sector employers currently offer benefits to unmarried same-sex partners, but that has been changing, even before the upcoming Supreme Court ruling. Companies that historically offered health benefits to the partners of employees in same-sex relationships did so partly out of altruism and principle, but also partly to prevent claims that they discriminated against employees based on their orientation or the gender of their partners. (While there is no federal law that specifically protects employees in the private sector from discrimination based on their sexual orientation, many such laws exist at the state level.) But to continue to allow unmarried same-sex couples access to benefits that are only available to wedded opposite-sex couples might expose employers to discrimination claims in the opposite direction, from heterosexual couples.

In effect, extending benefits to employees’ same-sex domestic partners was a bandage to cover a gap that is rapidly shrinking on its own. Companies soon may not need to accommodate employees with same-sex partners in any way that differs from their treatment of employees with partners of the opposite sex.

A few large companies, including Google, are taking the opportunity to extend their domestic partner benefits in the other direction, allowing unmarried mixed-gender couples to participate, as a way of recruiting a more diverse employee pool. Dow Chemical Co. is an example of an employer that has long offered domestic partnership benefits to employees regardless of their sexual orientation, and it has no plans to change the policy.

Some firms are choosing to drop spousal coverage altogether or to impose surcharges for covering spouses who have other means of obtaining coverage. These decisions likely have more to do with the growing cost of insurance than the number of married employees of any given sexual orientation. But such policies still treat all employees, and their spouses, equally.

Benefits that are offered only to unmarried same-sex couples are bound to vanish once marriage equality becomes a reality across America. The distinction between married same-sex couples and married opposite-sex couples is rapidly losing its significance.

Given the relatively low marriage rate among Americans, especially less educated ones, it will be interesting to see how employers respond to this shift. My suspicion is that, when marriage is open to everyone, benefits for domestic couples will be restricted in most cases to those who avail themselves of marriage. Welcome to the new normal.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s book, Looking Ahead: Life, Family, Wealth and Business After 55. His contributions include Chapter 1, “Looking Ahead When Youth Is Behind Us” and Chapter 4, “The Family Business."

Related Posts

The views expressed in this post are solely those of the author. We welcome additional perspectives in our comments section as long as they are on topic, civil in tone and signed with the writer's full name. All comments will be reviewed by our moderator prior to publication.

, , , , ,