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Legal Updates

Massachusetts Federal Court Extends Marriage-Based Federal Benefits To Same-Sex Spouses

The U.S. District Court for the District of Massachusetts recently held that the definition of “marriage” and “spouse” under Section 3 of the federal Defense of Marriage Act (“DOMA”) is unconstitutional.  Specifically, in Gill v. Office of Personnel Management, No. 09-cv-10309-JLT (D. Mass. July 8, 2010) (Tauro, J.), the Court held that Section 3 of DOMA, as applied to the particular plaintiffs in that case, violates the equal protection principles embodied in the Fifth Amendment to the United States Constitution.  Because some of the plaintiffs were federal employees and were challenging their right to certain employment benefits denied by their employer, this ruling raises the possibility that both public and private employers may soon be required to recognize same-sex spouses for purposes of marriage-based federal employee benefits.

Section 3 of DOMA, enacted in 1996, defines the terms “marriage” and “spouse” for purposes of federal law.  Under DOMA, “‘marriage’ means only a legal union between one man and one woman as husband and wife.”  The term “spouse” is defined as “a person of the opposite sex who is a husband or a wife.”  These terms are implicated in over one thousand federal statutory provisions, such as Social Security, family and medical leave, taxes, immigration, and healthcare.

The Gill Case

In Gill, seven same-sex couples who became legally married in Massachusetts and three survivors of same-sex spouses (who also became legally married in Massachusetts) brought an action for declaratory and injunctive relief against the Office of Personnel Management, the United States Postal Service, the Postmaster General of the United States, the commissioner of the Social Security Administration, the United States Attorney General, and the United States of America.  All plaintiffs were residents of the Commonwealth and a few were employees of the federal government.

In their complaint, the plaintiffs sought a determination that DOMA, as applied to plaintiffs, violates the United States Constitution by refusing to recognize lawful marriages for purposes of the laws governing benefits for federal employees and retirees, the Internal Revenue Code, and the Social Security laws.  The three federal health benefits programs implicated in the action were: the Federal Employees Health Benefits Program (“FEHB”), the Federal Employees Dental and Vision Insurance Program (“FEDVIP”), and the federal Flexible Spending Arrangement (“FSA”) program.  A number of plaintiffs sought Social Security benefits under the Social Security Act (“SSA”), based on marriage to a same-sex spouse.  In addition, a number of plaintiffs sought the ability to file federal income taxes jointly with their spouses.

Prior to filing the action, each plaintiff, or his or her spouse, made at least one request to the appropriate federal agency or authority for treatment as a married couple, spouse, or widower with respect to particular federal benefits available to married individuals.  When denying each request, the government agencies responsible for administering the relevant programs all invoked DOMA’s mandate that the federal government recognize only those marriages between one man and one woman.

The federal government argued that the Constitution permitted Congress to enact DOMA as a means to preserve the status quo, pending resolution of the debate in the states regarding same-sex marriage.  The plaintiffs argued that denying certain federal marriage-based benefits that are available to similarly-situated heterosexual couples violates the equal protection principles embodied in the Due Process Clause of the Fifth Amendment.  In granting summary judgment for the plaintiffs, the Court opined that domestic relations is the exclusive province of the states and that the federal government has always recognized differences in marriage laws.  The Court concluded with these harsh words about DOMA’s definition of marriage:  “Congress undertook this classification for the one purpose that lies entirely outside of legislative bounds, to disadvantage a group of which it disapproves” and that “irrational prejudice plainly never constitutes a legitimate government interest.”

In an amended judgment entered August 18, 2010 (the “Amended Judgment”), the Court ordered that Section 3 of DOMA is unconstitutional as applied to the plaintiffs by the defendants in the administration and application of: (a) the FEHB; (b) the FEDVIP; (c) the FSA; (d) certain retirement and survivor benefit provisions of the SSA; and (e) the Internal Revenue Code.  Specifically, individual plaintiffs were, among other things, entitled to (i) review of their benefit applications without regard to Section 3 of DOMA; (ii) designate their same-sex spouses as beneficiaries; (iii) receive reimbursement for denied benefits; and (iv) receive tax refunds from the IRS.

The Amended Judgment was appealed by the U.S. Department of Justice on October 12, 2010, and is now before the U.S. Court of Appeals for the First Circuit.

Companion Case

In a companion case decided the same day and by the same judge, Commonwealth of Mass. v. Dept. of Health and Human Servs., No. 09-cv-11156-JLT (D. Mass. July 8, 2010) (Tauro, J), the Court also struck down the validity of Section 3 of DOMA in the context of certain federal-state programs.  This case was initiated by the Commonwealth rather than a group of individuals.  Specifically, the Commonwealth argued that certain federal-state programs violated the U.S. Constitution by forcing the Commonwealth to engage in invidious discrimination against its own citizens.

The programs at issue were a military cemetery and the Commonwealth’s Medicaid program (“MassHealth”) that both required the Commonwealth to rely on the federal definition of “spouse” to make decisions regarding certain rights and benefits.  The Court agreed with the Commonwealth and held that DOMA violated the Spending Clause by imposing an unjustified condition on the receipt of federal funding and violated the Tenth Amendment by encroaching on a core area of state sovereignty – the ability to define the marital status of its citizens.

In a statement regarding the HHS decision, Massachusetts Attorney General Martha Coakley commented that “[i]t is unconstitutional for the federal government to discriminate, as it does because of DOMA’s restrictive definition of marriage.  It is also unconstitutional for the federal government to decide who is married and to create a system of first- and second-class marriages.”

Impact of Gill

As expressly stated in the Amended Judgment, the holding of Gill applies only to the individual plaintiffs in that case.  In other words, the ruling does not declare Section 3 of DOMA unconstitutional in every circumstance.  Moreover, if similarly-situated plaintiffs presently brought a case before another judge, there is no requirement that the judge follow the Gill decision.  However, Gill could become precedential, depending on how the U.S. Court of Appeals for the First Circuit handles the pending appeal.

Although the eventual impact of Gill and HHS is difficult to determine, these cases may ultimately affect both public- and private-sector employers.  For example, DOMA permits (but does not require) employers to deny same-sex spouses federal COBRA benefits and precludes an employee from making pre-tax contributions to a “cafeteria” plan on behalf of a same-sex spouse.  The Gill and HHS rulings open the door for future challenges to these federal benefits (among others).

In addition, following Gill, employees in Massachusetts (and other states that recognize same-sex marriage) have more support for the argument that they are entitled to same-sex spousal benefits under the federal Family and Medical Leave Act of 1993 (“FMLA”).  Specifically, the FMLA regulations define the term “spouse” as “a husband or wife as defined or recognized under State law for purposes of marriage in the State where the employee resides.”  29 C.F.R. sec. 825.122(a).  Upon the enactment of DOMA, however, the U.S. Department of Labor clarified in a 1998 Opinion Letter that DOMA’s definition of “spouse” overrides the referenced regulations.  The Gill decision may pose a significant challenge to the federal government’s current position.

At a minimum, both the Gill and HHS decisions are clearly significant for same-sex couples in states that recognize same-sex marriage as persuasive authority that other judges may choose to adopt in both employment disputes and other contexts.

Recommendations for Employers

Only time will tell how influential these decisions will be in affecting employment rights on a broader scale.  However, given the significance of these decisions, we recommend that employers take steps now to ensure that they are implementing their employee benefit plans and policies consistently and in accordance with applicable law.  To that end, we recommend that employers:

  • Review these decisions with counsel to consider the impact that they might have if they become precedent-setting.  While most employers in Massachusetts automatically include the rights of same-sex spouses when implementing marriage-based benefits under state law, certain benefits governed in whole or in part by federal law may nonetheless be implicated (such as when an employer follows federal laws such as COBRA, the FMLA, HIPAA, or the Internal Revenue Code, e.g., by offering tax-free health benefits).
  • Review plan documents and policies to identify marriage-based benefits and the definitions of “spouse” and “marriage.”  For example, ensure that the definition of spouse and marriage under the employer’s group health plan matches the company’s actual practices and policies.
  • Determine whether the company will voluntarily extend benefits to same-sex spouses in the absence of any legal mandate.  If so, determine whether plan documents must be amended or certain administrative actions should be taken to ensure compliance with applicable law.  For example, employers are not required to extend COBRA to same-sex spouses, but employers may choose to offer COBRA-like continuation benefits through their health plans.  Likewise, employers may choose to amend their qualified retirement plans to provide comparable benefits to same-sex spouses.
  • If employers are operating outside Massachusetts, consider if and when the company will (or must) recognize a same-sex marriage legalized by another state.

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If you have any questions about these recent cases or would like assistance with reviewing your employee benefit plans and policies, please do not hesitate to contact us.