A Near Miss? Domestic Partnership Benefits in the Age of Marriage Equality

Prior to the passage of the Marriage Equality Act in New York State last June, many employers in the state had adopted policies of providing certain benefits to the same-sex partners of their LGBT employees.  They generally did not provide such benefits to unmarried different-sex partners of employees, the logic being that if they wanted the benefits, they could get married, so they were not "similarly situated" to the LGBT employees.   This logic started to break down as New York appellate courts, beginning in 2008, began signalling that under comity principles New York government agencies and courts should recognize same-sex marriages contracted out of state.  When the Marriage Equality Act went into effect on July 24, 2011, this reasoning took another hit.

Early this week, the New York Court of Appeals, our highest state court, was scheduled to hear arguments in the case of Westchester County Human Rights Commission v. Putnam/Northern Westchester Board of Cooperative Educational Services, presenting the question whether the appellant school district had violated the state Human Rights Law ban on sexual orientation or marital status discrimination by making benefits available to same-sex domestic partners but not to different-sex domestic partners.  A last minute agreement by the parties (of undisclosed nature) withdrew the case from the court's argument calendar, so we won't be getting an answer to this question by the Court of Appeals at this time.

The complainant in this case is a teacher in Croton Harmon Union Free School District, which provides benefits to its employees through a consortium of educational employers that is administered by Putnam/Northern Westchester BOCES through a Joint Governance Board.  In March 2005 the Board voted to extend health benefits eligibility to same-sex domestic partners of member employees.  Complainant then applied for such benefits for her different-sex domestic partner, but her request was denied.  Complainant then went to the Westchester County Human Rights Commission, where an Administrative Law Judge ruled in her favor and recommended that the Commission order the Board to make benefits available to all domestic partners, regardless of sex, and award damages to the complainant.  The Commission accepted the ALJ's recommendation, and the Board appealed to the Appellate Division, 2nd Department.

That court ruled on February 8, 2011, 81 A.D.3d 733, 917 N.Y.S.2d 635, finding that the Board did not discriminate based on marital status "because eligibility for the domestic partner health care benefits for which she applied does not turn on the marital status of the employee."  Indeed, by definition, domestic partnership benefits are only for people who are not legally married.   However, the appellate division found that complainant had stated a sexual orientation discrimination claim.  As to this, however, the court found that the Board had met its burden to "set forth a legitimate, nondiscriminatory reason for the decision to extend domestic partnership benefits only to same sex couples."  That reason was that same-sex couples could not obtain the benefits by marrying, but unmarried different-sex couples could obtain the benefits by marrying.

"Indeed," wrote the court, "the Domestic Partner Policy itself states that it may be rescinded in the event that same-sex marriage becomes legal in the member's state of residence.  Contrary to the respondents' contentions, the ability of same-sex couples to be lawfully married in certain other jurisdictions does not undermine the legitimate, nondiscriminatory basis for the petitioners' decision to offer benefits to same-sex couples, that is, the impediment to marrying in this State."

Of course, at the time the appellate division issued this ruling, February 8, 2011, the Marriage Equality bill was pending in the legislature and the ultimately successful campaign to round up enough votes to pass it in the Senate was just starting.  Perhaps the parties withdrew the Commission's appeal from the active docket because changes are in motion as a result of enactment of the law.  Perhaps the Board intends to do what its policy says: rescind the benefit now that same-sex couples can marry in New York.  Or perhaps they are making the opposite decision: to retain the policy and extend it to people like the complainant.  News reports about the withdrawal of the appeal did not specify the parties' reasons.

This is the issue facing employers who adopted same-sex only domestic partner benefits plans: to extend them to all domestic partners of employees without regard to sex, to continue them as same-sex only, or to rescind the policies, thus requiring same-sex couples to marry in order to retain benefits coverage? 

As far as legal issues go, the state has nothing to say about what private sector employers do, because regulation of discrimination based on sexual orientation by private sector employers with respect to employee benefits is preempted by the federal Employee Retirement Income Security Act (ERISA), and federal law has nothing substantive to say about this, apart from the refusal of federal law to recognize marriages of same-sex partners. 

As to public sector employers, a good argument could certainly be made that the constitutional obligation of Equal Protection as well as the state law policy against sexual orientation discrimination would be violated by continuing to maintain a domestic partner benefit plan that is only for same-sex couples.  Indeed, one of the talking points by those who politically preferred civil unions or domestic partnerships instead of marriage for same-sex couples was the possibility of wiping out health benefits for gay couples who chose not to marry, which now looks like a reality in the case of employers who are loathe to extend the benefits to different-sex partners.

As a practical and ethical question, should employers be pushing their workers to marry in order to get benefits?  Why should whether workers are married be any business of employers?  Indeed, NY's Human Rights Law forbids discrimination based on marital status, and perhaps now the argument could be made that an employer who terminates their benefits plan and requires workers to marry to get benefits is discriminating based on marital status.  The part of the appellate division's ruling that rejected the complainant's marital status discrimination claim would have to be rethought in such a situation.

And the problem could be solved, of course, by having a national single-payer insurance system that broke the link between health insurance and employment, or adopting something similar on the state level, such as the Massachusetts experiment pioneered during former Governor Mitt Romney's administration to extend coverage to the uninsured.

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