On June 26, 2013, the United States Supreme Court issued a pair of opinions favorable to the gay rights movement, ruling that married same-sex couples are entitled to federal benefits and, by declining to decide a case from California, effectively allowing same-sex marriages in that state.
Executive Summary: On June 26, 2013, the United States Supreme Court issued a pair of opinions favorable to the gay rights movement, ruling that married same-sex couples are entitled to federal benefits and, by declining to decide a case from California, effectively allowing same-sex marriages in that state. In United States v. Windsor (June 26, 2013), the Court held that Section 3 of the federal Defense of Marriage Act (DOMA) is unconstitutional because it violates the Fifth Amendment. The Court's decision to strike down this provision, which denies more than 1,000 federal benefits to same-sex married couples, may dramatically transform the legal status and financial standing of hundreds of thousands of gay Americans. The decision on the federal law was 5 to 4, with Justice Anthony M. Kennedy writing the majority opinion, which the four liberal-leaning justices – Justices Ginsburg, Breyer, Sotomayor, and Kagan – joined.
Background
DOMA, enacted in 1996, is a United States federal law that allows states to refuse to recognize same-sex marriages performed under the laws of other states. Section 3 of the Act codifies the non-recognition of same-sex marriages for all federal purposes, including insurance benefits for government employees, Social Security survivors' benefits, immigration, and the filing of joint tax returns.
The Department of Justice (DOJ) stopped defending DOMA in court in 2011 after Attorney General Eric Holder told Congress and President Barack Obama he had determined that "classifications on sexual orientation" were not consistent with the Constitution's guarantee of equal protection under law as established by the Fifth Amendment. The Obama administration continued to enforce the law nationwide. Republican leaders in the House of Representatives took up the law's defense in March 2011.
Section 3 of DOMA was found unconstitutional in eight federal courts, including the First and Second Circuit Courts of Appeals, on issues including bankruptcy, public employee benefits, estate taxes, and immigration. In Windsor, the Supreme Court held that Section 3 of DOMA is unconstitutional "as a deprivation of the equal liberty of persons that is protected by the Fifth Amendment."
The Facts of the Case
The case on which the Supreme Court ruled Wednesday considered the part of the law that defines marriage as the union of a man and a woman for purposes of federal benefits. (A different part of the law – allowing states to refuse to recognize same-sex marriages from other states – was not before the court.)
The case concerned two New York City women, Edith Windsor and Thea Clara Spyer, who lived together in New York City for over 40 years before they were married in 2007 in Canada. Ms. Spyer died in 2009, and Ms. Windsor inherited her property. The 1996 law did not allow the Internal Revenue Service to treat Ms. Windsor as a surviving spouse, and she faced a tax bill of about $360,000 that a spouse in an opposite-sex marriage would not have had to pay. Ms. Windsor sued, and last year the United States Court of Appeals for the Second Circuit struck down the 1996 law, setting the stage for the Supreme Court to make a final determination.
Finding Section 3 of DOMA unconstitutional, Justice Kennedy wrote, "The federal statute is invalid, for no legitimate purpose overcomes the purpose and effect to disparage and injure those whom the State, by its marriage laws, sought to protect in personhood and dignity." Additionally, the Court held, "By seeking to displace this protection and treating those persons as living in marriages less respected than others, the federal statute is in violation of the Fifth Amendment."
The following are a few of the key benefits many same-sex couples stand to receive now that the Supreme Court has dispensed with DOMA:
- Survivors' benefits: DOMA barred gay and lesbian couples from many entitlement and welfare programs, including those tied to Social Security. Same-sex spouses will now be eligible for Social Security survivors' benefits upon death of a partner, among other forms of assistance.
- Tax-free employee health insurance: Federal law has lagged behind the almost 40% of Fortune 500 companies who offer tax-free employer-provided health benefits to domestic partners. Health coverage for the spouses of gay and lesbian employees will now be available without taxable strings attached.
- Emergency Leave: Current law does not offer gay and lesbian employees time off from work to tend to a domestic partner or that partner's family member. But the guarantees provided by the Family and Medical Leave Act (FMLA) will soon be available to same-sex spouses.
- Green cards and visas: There are an estimated 28,500 bi-national same-sex couples – meaning one partner is a U.S. citizen or permanent resident and one isn't – but DOMA did not allow the former to petition for the latter to immigrate. Now, however, gays and lesbians may lobby the federal government for green cards or visas for a non-American same-sex partner.
Employers' Bottom Line: For the first time, the Supreme Court advanced the inherent equality of gay couples and looked with favor on the legitimacy of those marriages, at least when it comes to federal recognition of state-sanctioned unions. The decision on federal benefits will immediately extend many benefits to couples in the states where same-sex marriage is legal – effectively increased to 13 states, as well as the District of Columbia, with the Court's ruling in Hollingsworth v. Perry (June 26, 2013, Prop 8 opinion). Specifically, federal laws governing employee benefit plans will require employers to treat employees' same-sex spouses and opposite-sex partners equally for purposes of the benefits that the employer extends to spouses. Employers in California, Connecticut, Delaware, Iowa, Maine, Maryland, Massachusetts, Minnesota, New Hampshire, New York, Rhode Island, Vermont, Washington and the District of Columbia should quickly analyze the impact that this ruling has on the benefits that employers may or must offer to same-sex spouses of their employees, as well as leave benefits.
If you have any questions regarding this decision or other labor or employment related issues, please contact the FordHarrison attorney with whom you usually work or the author of this Alert, Scott Evans, sevans@fordharrison.com, an attorney in our Birmingham and Atlanta offices.