Last month, the nation was transformed when the U.S. Supreme Court unequivocally declared same-sex marriage a fundamental right. The mandate was clear: all U.S. states must grant marriage licenses to same-sex couples and recognize same-sex marriages for purposes of the myriad of laws that afford benefits and privileges to married couples.
After the celebrations have died down and the uproar from the opposition has quieted, the confusion set in. A month has lapsed, and business owners and human resources professionals are scratching their heads, pondering the logistical impact of the Court’s decision. What exactly does the ruling mean for employers in terms of administrating workplace benefits, from health insurance to retirement savings?
Most employers know the basics. Now that all 50 states must recognize same-sex marriages, all of the rights that are afforded to heterosexual married couples —including those governed by the alphabet soup of employment benefit laws: COBRA, FMLA, and HIPAA — must also now accrue to same-sex spouses. Employer-provided health insurance plans must now cover same-sex spouses on the same terms as it covers different-sex spouses. This raises questions over how and when these changes are administered, especially when insurance plans provide narrow windows of time for changing employee benefit elections?
Let’s break it down. Insurance plans typically establish a time period known as “open enrollment” during which all employees may enroll in or change their benefit elections. An open enrollment period comes once a year, usually at the beginning or end of the calendar or fiscal year.
In addition to the open enrollment period, employees may add to or change their benefit elections if they qualify for what is called “special enrollment.” To qualify, an employee must experience and be able to document a designated life event that changes the employee’s circumstances in a material way. The existence of a life event is what justifies the departure from normal practice, allowing the insurance company to make an exception for the employee to change her benefits elections outside of the open enrollment period. Examples of a qualifying life event include getting married, having a baby, or adopting a child.
Human resources professionals in states that banned same-sex marriage pre- Obergefell are struggling to determine how these enrollment periods affect employees with same-sex spouses. They know that employees who married same-sex spouses after the Supreme Court’s June 26th decision are eligible for special enrollment, since a marriage is a qualifying event. But, how should they treat employees who were legally married to same-sex spouses in another state prior to the June decision?
Consider the following scenario: Jane legally married Michelle in Massachusetts in 2009. In 2010, Jane and Michelle moved to Michigan (a State that banned same-sex marriage prior to the Obergefell decision), and Jane began working for a company that did not offer benefits to same-sex spouses. From 2010-2015, Jane was unable to secure spousal health insurance. Now that same-sex marriage is legal in all 50 states, Jane wishes to add Michelle to her health insurance plan as soon as possible. But, her employer’s open enrollment period is not until January 1, 2016.
Certainly, the Obergefell decision itself does not constitute a qualifying event for purposes of special enrollment. But does the new legal recognition of same-sex marriages previously performed in another state count as a qualifying life event? Or must Jane wait until the open enrollment period begins on January 1, 2016 to add Michelle to her health insurance?
The Supreme Court’s same-sex marriage ruling answered the important question surrounding the constitutionality of same-sex marriage, but its decision left gaping logistical holes. Whether Jane is eligible for special enrollment purposes and other questions like this are causing headaches for human resources professionals, who are working overtime to parse out the logistical intricacies of the Supreme Court’s decision.
While commentators and legal pundits reflect on the historic magnitude of the Court’s decision, human resources professionals are left picking up the logistical pieces. The administration of workplace benefits to same-sex couples may be mundane, but it is an integral first step to ensuring that the Court’s decision truly results in marriage equality.
Danielle Weatherby is an assistant professor at the University of Arkansas School of Law.