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New York’s same-sex marriage law requires reviewing benefits

by on
in Compensation and Benefits,Employment Law,Human Resources

by Thaddeus J. Lewkowicz, Esq.

On June 24, 2011, Gov. Andrew Cuomo signed the Marriage Equal­ity Act, which allows same-sex couples to be married in New York and to have, with certain exceptions, the same legal protections available to opposite-sex couples married in New York. The law went into effect on July 24.

The law has important implications for employer-provided benefits. (See the box below for details on what you should do to comply.)

The major changes

The Marriage Equality Act states:

  • No application for a marriage li­­cense in New York will be denied because the parties are of the same sex.
  • An otherwise valid marriage remains valid whether the parties are of the same or different sex.
  • No government treatment or legal status relating to marriage in New York will differ because the parties are or have been of the same rather than a different sex.

The law allows exceptions for religious entities, benevolent organizations and nonprofit organizations that are operated, supervised or controlled by religious entities that may object to same-sex marriage.

Effect on retirement plans

Spouses of participants in certain types of retirement plans subject to the requirements of the Internal Revenue Code and the Employee Retirement Income Security Act (ERISA) are entitled to special protections. Those include the right to receive a qualified joint and survivor annuity or a qualified preretirement survivor annuity.

With the enactment of the legislation, the issue arises as to whether these spousal protections must be provided to a same-sex spouse of a New York participant in such retirement plans. The answer currently is no.

The federal Defense of Marriage Act (DOMA) provides that, for purposes of all federal laws, the term “spouse” only refers to a person of the opposite sex who is a husband or wife. Under DOMA, the term “spouse” for IRS and ERISA purposes will not include a same-sex spouse. (The ERISA generally pre-empts state laws, other than insurance laws and certain other laws.)

Therefore, retirement plans that are subject to the requirements of the IRS Code and the ERISA will not be subject to the new requirements imposed by the legislation.

Nevertheless, you still should verify that any definition of “spouse” in your plans will not inadvertently in­­clude same-sex spouses in a manner that creates issues under the IRS Code or the ERISA. Such retirement plans are required to be administered in ­accordance with their written terms. If you have such plans, make sure the change in the definition of “spouse” in the legislation will not result in any inconsistency between how your plan defines “spouse” and how that definition is administered.

Impact on health, other benefits

In 2008, the New York State In­sur­ance Department issued an opinion directing that same-sex spouses legally married outside of New York must be treated the same as opposite-sex spouses for purposes of insured health, group long-term disability, group short-term disability, and group term life insurance plans that are subject to the requirements of the New York In­sur­ance Law.

Effective July 24, 2011, same-sex spouses who are married in New York have the same rights under insured plans that were provided in 2008 to same-sex married spouses ­legally married outside New York.

If you have insured plans, therefore, review the language in your plan documents, summary plan descriptions and insurance policies to see whether the definition of spouse will need any revision to include same-sex spouses who are married in New York.

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Author: Ted Lewkowicz counsels employers on a wide spectrum of employee benefits and tax issues. Contact him at (315) 218-8131 or tlewkowicz@bsk.com.

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