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THE LAW OF THE LAND: A SPOUSE IS A SPOUSE
On June 26, 2015 the Supreme Court rendered its
opinion in the matter of Obergefell v. Hodges. Two
questions were addressed. First, the Supreme Court
has determined that it is a violation of the
Fourteenth Amendment’s Due Process Clause of the
U. S. Constitution (the equal protection clause) for a
state to restrict marriage to only opposite sex
people. Secondly, the Supreme Court ruled that a
state must recognize same-sex marriage entered
into in another jurisdiction. In short, as a result of
this decision, all states must recognize same sex
marriages whether entered in that state or in
another state.
This decision comes two years to the day from the
United States v. Windsor case where the Court
struck down the Defense of Marriage Act (see CBIZ
Benefit Beat, Supreme Court Opines on Same-
Sex Marriage Issues, 7/5/13), effectively making
same-sex marriage recognized for all federal
purposes.
IMPACT ON EMPLOYEE BENEFITS
What the Obergefell v. Hodges ruling means for
employment and particularly employee benefit
purposes will surely evolve in the days and months
to come, as states discern how to implement this
ruling.
Health Coverage
It is probable that insurance laws defining spouse
will be reviewed and modified, if necessary, to reflect
this broader definition. Similarly, insurance
contracts, such as health insurance contracts and life
insurance contracts that define spouse may be
modified by the insurers to reflect this new
definition.
July 2, 2015
In This Edition:
 THE LAW OF THE LAND: A
SPOUSE IS A SPOUSE
 EEOC UPDATES PREGNANCY
DISCRIMINATION GUIDELINES
 REINSTATEMENT OF HEALTH
CARE TAX CREDIT
page 1
July 2, 2015 page 2
Continued from page 1
At this point, it is unclear whether a self-
funded health plan subject to ERISA could
define spouse more narrowly. As a reminder,
ERISA does not define spouse for welfare
benefit plan purposes. Even if a self-funded
plan can be written to define spouse to include
only opposite sex spouse, this could raise
discrimination issues, particularly in
jurisdictions that have laws prohibiting
discrimination based on sexual orientation.
Any employer contemplating a limited
definition of spouse should consult with legal
counsel before taking any action.
A couple married in a state that newly
recognizes same-sex marriage, the marriage
would qualify as a special enrollment
opportunity for health plan purposes.
Coordination with Domestic Partner
Coverage
Employers that offer domestic partner benefits
may want to consider whether to continue
these provisions. Some states, such as
California, continue to require coverage of
registered domestic partners for many benefit
plan purposes. In many other jurisdictions,
however, this is not required.
If an employer chooses to retain an eligibility
classification for domestic partnerships, civil
unions or the like, it is important to remember
that the tax consequences for benefits
provided in such situations remain unchanged.
In other words, only if the domestic partner
qualifies as a tax dependent can tax-favored
benefits be provided.
Employer-provided Pension and
Retirement Plans
For retirement plan purposes, this new ruling
will have little impact on ERISA plans since
they are governed by federal law and the
definition of spouse was broadened by
Windsor. However, for state and local
government plan purposes, spouse will now
include both same and opposite sex.
Beneficiary Designations
Employers might want to recommend that
employees review their beneficiary
designations as it applies to the relevant
plan(s) such as life insurance and retirement
plans. This is generally a good practice at
open enrollment to remind employees to
review and update, as appropriate, their
beneficiary designations.
State Tax Matters
As a result of Windsor, a same-sex spouse is
treated for tax purposes in the same manner
as an opposite sex spouse. With the advent of
this new ruling, for state tax purposes, all
spouses whether same or opposite sex will be
treated in the same manner. It is likely states
will issue guidance on this matter in the near
future.
Once again, employers should review their
definition of spouse in all of their welfare
benefit plans, cafeteria plans, and retirement
and savings plans and make any necessary
modifications. In addition, an employer might
also want to review all of its employment
policies to ensure these policies include an
appropriate definition of spouse.
EEOC UPDATES PREGNANCY
DISCRIMINATION GUIDELINES
Last summer, the Equal Employment
Opportunity Commission (EEOC) released
enforcement guidance, together with FAQs
and Fact Sheet, relating to pregnancy
discrimination (see The Pregnancy
Discrimination Act gets some TLC if not a
full Makeover (CBIZ Benefit Beat,
8/20/2014). As a result of the recent court
case in Young v. United Parcel Service, (see
The Intersection of the Pregnancy
Discrimination Act and the Employer’s
Workplace Policy, CBIZ Benefit Beat,
5/12/15), the EEOC has released updated
guidance to address some of the Supreme
Court’s recommendations for determining
whether a workplace policy is discriminatory
against pregnant workers.
July 2, 2015 page 3
Specifically, the revised guidance addresses
disparate treatment and light duty. In a
nutshell, the EEOC guidance indicates that
even though an employer policy is not
intended to discriminate against pregnant
workers, it may nevertheless violate the
Pregnancy Discrimination Act, as well as the
Americans with Disabilities Act, if such policy
appears to impose significant burdens on
pregnant workers without a strong business
justification for the policy. Accordingly, if an
employer’s work place policy provides for light
duty accommodations, including lifting
restrictions, it should ensure that the offer of
light duty accommodation be made available
to all members of the employer’s workforce.
REINSTATEMENT OF
HEALTH CARE TAX CREDIT
The Health Care Tax Credit (HCTC) was
initially placed into law by the Trade Act of
2002. The purpose of the HCTC was to
provide premium assistance in the form of a
tax credit, equaling 72.5% of COBRA premium
paid by individuals who lost jobs due to
foreign trade-related agreements. The HCTC
expired on December 31, 2013.
On June 29, 2015, President Obama signed
the Trade Preferences Extension Act of
2015 (Public Law No. 114-27). This new law
not only reinstates the HCTC through 2019,
but it also provides for retroactive
certifications from when the program expired
on January 1, 2014. In addition, the new law
makes changes to the group eligibility
requirements and individual benefits and
services available under the Trade Adjustment
Assistance (TAA) program since January 1,
2014.
The Department of Labor’s Employment and
Training Administration website provides
additional information about the reinstatement
of the HCTC, as well as information relating to
reconsideration of previously denied petitions
and certification processes as a result of the
new law.
ABOUT THE AUTHOR: Karen R. McLeese is Vice President
of Employee Benefit Regulatory Affairs for CBIZ
Benefits & Insurance Services, Inc., a division of
CBIZ, Inc. She serves as in-house counsel, with
particular emphasis on monitoring and interpreting
state and federal employee benefits law. Ms.
McLeese is based in the CBIZ Kansas City office.
The information contained in this Benefit Beat is not
intended to be legal, accounting, or other professional
advice, nor are these comments directed to specific
situations. This information is provided as general
guidance and may be affected by changes in law or
regulation. This information is not intended to replace or
substitute for accounting or other professional advice. You
must consult your own attorney or tax advisor for
assistance in specific situations. This information is
provided as-is, with no warranties of any kind. CBIZ shall
not be liable for any damages whatsoever in connection
with its use and assumes no obligation to inform the
reader of any changes in laws or other factors that could
affect the information contained herein.

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Benefit beat July 2015

  • 1. THE LAW OF THE LAND: A SPOUSE IS A SPOUSE On June 26, 2015 the Supreme Court rendered its opinion in the matter of Obergefell v. Hodges. Two questions were addressed. First, the Supreme Court has determined that it is a violation of the Fourteenth Amendment’s Due Process Clause of the U. S. Constitution (the equal protection clause) for a state to restrict marriage to only opposite sex people. Secondly, the Supreme Court ruled that a state must recognize same-sex marriage entered into in another jurisdiction. In short, as a result of this decision, all states must recognize same sex marriages whether entered in that state or in another state. This decision comes two years to the day from the United States v. Windsor case where the Court struck down the Defense of Marriage Act (see CBIZ Benefit Beat, Supreme Court Opines on Same- Sex Marriage Issues, 7/5/13), effectively making same-sex marriage recognized for all federal purposes. IMPACT ON EMPLOYEE BENEFITS What the Obergefell v. Hodges ruling means for employment and particularly employee benefit purposes will surely evolve in the days and months to come, as states discern how to implement this ruling. Health Coverage It is probable that insurance laws defining spouse will be reviewed and modified, if necessary, to reflect this broader definition. Similarly, insurance contracts, such as health insurance contracts and life insurance contracts that define spouse may be modified by the insurers to reflect this new definition. July 2, 2015 In This Edition:  THE LAW OF THE LAND: A SPOUSE IS A SPOUSE  EEOC UPDATES PREGNANCY DISCRIMINATION GUIDELINES  REINSTATEMENT OF HEALTH CARE TAX CREDIT page 1
  • 2. July 2, 2015 page 2 Continued from page 1 At this point, it is unclear whether a self- funded health plan subject to ERISA could define spouse more narrowly. As a reminder, ERISA does not define spouse for welfare benefit plan purposes. Even if a self-funded plan can be written to define spouse to include only opposite sex spouse, this could raise discrimination issues, particularly in jurisdictions that have laws prohibiting discrimination based on sexual orientation. Any employer contemplating a limited definition of spouse should consult with legal counsel before taking any action. A couple married in a state that newly recognizes same-sex marriage, the marriage would qualify as a special enrollment opportunity for health plan purposes. Coordination with Domestic Partner Coverage Employers that offer domestic partner benefits may want to consider whether to continue these provisions. Some states, such as California, continue to require coverage of registered domestic partners for many benefit plan purposes. In many other jurisdictions, however, this is not required. If an employer chooses to retain an eligibility classification for domestic partnerships, civil unions or the like, it is important to remember that the tax consequences for benefits provided in such situations remain unchanged. In other words, only if the domestic partner qualifies as a tax dependent can tax-favored benefits be provided. Employer-provided Pension and Retirement Plans For retirement plan purposes, this new ruling will have little impact on ERISA plans since they are governed by federal law and the definition of spouse was broadened by Windsor. However, for state and local government plan purposes, spouse will now include both same and opposite sex. Beneficiary Designations Employers might want to recommend that employees review their beneficiary designations as it applies to the relevant plan(s) such as life insurance and retirement plans. This is generally a good practice at open enrollment to remind employees to review and update, as appropriate, their beneficiary designations. State Tax Matters As a result of Windsor, a same-sex spouse is treated for tax purposes in the same manner as an opposite sex spouse. With the advent of this new ruling, for state tax purposes, all spouses whether same or opposite sex will be treated in the same manner. It is likely states will issue guidance on this matter in the near future. Once again, employers should review their definition of spouse in all of their welfare benefit plans, cafeteria plans, and retirement and savings plans and make any necessary modifications. In addition, an employer might also want to review all of its employment policies to ensure these policies include an appropriate definition of spouse. EEOC UPDATES PREGNANCY DISCRIMINATION GUIDELINES Last summer, the Equal Employment Opportunity Commission (EEOC) released enforcement guidance, together with FAQs and Fact Sheet, relating to pregnancy discrimination (see The Pregnancy Discrimination Act gets some TLC if not a full Makeover (CBIZ Benefit Beat, 8/20/2014). As a result of the recent court case in Young v. United Parcel Service, (see The Intersection of the Pregnancy Discrimination Act and the Employer’s Workplace Policy, CBIZ Benefit Beat, 5/12/15), the EEOC has released updated guidance to address some of the Supreme Court’s recommendations for determining whether a workplace policy is discriminatory against pregnant workers.
  • 3. July 2, 2015 page 3 Specifically, the revised guidance addresses disparate treatment and light duty. In a nutshell, the EEOC guidance indicates that even though an employer policy is not intended to discriminate against pregnant workers, it may nevertheless violate the Pregnancy Discrimination Act, as well as the Americans with Disabilities Act, if such policy appears to impose significant burdens on pregnant workers without a strong business justification for the policy. Accordingly, if an employer’s work place policy provides for light duty accommodations, including lifting restrictions, it should ensure that the offer of light duty accommodation be made available to all members of the employer’s workforce. REINSTATEMENT OF HEALTH CARE TAX CREDIT The Health Care Tax Credit (HCTC) was initially placed into law by the Trade Act of 2002. The purpose of the HCTC was to provide premium assistance in the form of a tax credit, equaling 72.5% of COBRA premium paid by individuals who lost jobs due to foreign trade-related agreements. The HCTC expired on December 31, 2013. On June 29, 2015, President Obama signed the Trade Preferences Extension Act of 2015 (Public Law No. 114-27). This new law not only reinstates the HCTC through 2019, but it also provides for retroactive certifications from when the program expired on January 1, 2014. In addition, the new law makes changes to the group eligibility requirements and individual benefits and services available under the Trade Adjustment Assistance (TAA) program since January 1, 2014. The Department of Labor’s Employment and Training Administration website provides additional information about the reinstatement of the HCTC, as well as information relating to reconsideration of previously denied petitions and certification processes as a result of the new law. ABOUT THE AUTHOR: Karen R. McLeese is Vice President of Employee Benefit Regulatory Affairs for CBIZ Benefits & Insurance Services, Inc., a division of CBIZ, Inc. She serves as in-house counsel, with particular emphasis on monitoring and interpreting state and federal employee benefits law. Ms. McLeese is based in the CBIZ Kansas City office. The information contained in this Benefit Beat is not intended to be legal, accounting, or other professional advice, nor are these comments directed to specific situations. This information is provided as general guidance and may be affected by changes in law or regulation. This information is not intended to replace or substitute for accounting or other professional advice. You must consult your own attorney or tax advisor for assistance in specific situations. This information is provided as-is, with no warranties of any kind. CBIZ shall not be liable for any damages whatsoever in connection with its use and assumes no obligation to inform the reader of any changes in laws or other factors that could affect the information contained herein.