Did the Windsor Case Striking Down DOMA “Undomicile” Employment Law?

On June 26, 2013, in United States v. Windsor, the Supreme Court invalidated Section 3 of DOMA making unconstitutional that part of the federal Defense of Marriage Act. Marriage is no longer defined as between a man and a woman to the extent determined in Windsor. Section 2 of DOMA, however, still stands, and allows states to refuse to recognize same-sex marriages performed in other states. While perhaps good constitutional law, it will unsettle “domesticate tranquility” for some time to come! So what might be the ramifications for you as a businessperson or an individual? We suggest some guidance as we explore this complex subject.

Employers and counsel should anticipate an increase in Family Medical Leave Act leave requests. While the FMLA regulations use place of residency to determine who are spouses, since Section 2 of DOMA still stands, we see many residency issues. A company near the border of the Commonwealth of Social Ferment and of the state of Status Quo, (a state that recognizes same-sex marriage and one that does not), for example, could run into trouble when an employee moves from one state to the other. This can potentially create a legal dilemma for a business when faced with such a request for leave to take care of a “spouse’s serious medical condition,” since the location of the company is not the deciding factor, but residency of the person seeking leave. Given this, companies policies will need to be kept up-to-date, and HR and counsel will need to monitor guidance from the U.S. Department of Labor. Although Windsor was decided on equal protection laws, are there implications for gender discrimination laws? It is not hard to imagine that new forms of gender discrimination may flow from “new gender rights.”

The Employee Retirement Income Security Act (ERISA) governs privately sponsored benefit plans. Beneficiary spouses receive some 401(k) plan benefits, while non-spouses will not. With the Windsor decision, some plan changes may require the consent of the same-sex partner. Further complications arise when dealing with Section 403(b) which governs plans that may be exempt from ERISA and become subject to state law. Because ERISA does not totally preempt a state’s regulation of insurance in the area, coverage may depend on the definitions of a spouse in the state in which the insurance is regulated.

We need to be certain as to how the relevant states and federal agencies recognize marriage. Some federal agencies, like the Department of Defense, use the simple standard that wherever a couple is legally married anywhere in the world, they qualify for federal benefits. Just to make things interesting!!, some agencies use a residency standard to determine if the marriage is recognized.

The IRS and the Social Security Administration use a residency standard. If the marriage is unrecognized in a spouse’s state, they are not eligible for benefits. There is no easy guide to where and when the different standards are used. The Department of Veterans Affairs also uses the residency standard, and when compared to the Department of Defense, married couples would be eligible for some of these similar benefits, but not others.

In Massachusetts (and in other states with similar laws), a civil union or registered domestic partnership will be treated as a marriage for all state purposes and may we assume for most federal purposes? We expect both innumerable legal issues and numerous legal challenges across the country, not only to the possible denial of federal benefits to legally married same-sex couples, but also as a result of the remaining state bans on same-sex marriage.

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Larry

About Larry

Attorney Morse represents individual and business clients throughout Massachusetts some remotely. He handles a variety of employment matters, negotiating employment agreements, severance agreements, confidentiality and non-disclosure language to protect trade secrets, etc., and resolving disputes. He assists businesses and partnerships at all stages through sale or dissolution. He helps clients in the purchase and sale of businesses and as an adviser to closely held corporations & limited liability companies.
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