Same-Sex Marriage: All Employee Benefits Are Now Created Equal

August 18, 2015

Category: Compliance, Benefits

Same-Sex Marriage and Employee Benefits

This summer, the United States Supreme Court legalized same-sex marriage—its impact quickly carried from the court to the chapel to your company. The landmark decision in Obergefell v. Hodges overturns prior policy which had allowed some states to deny marriage licenses—and by default, employee spousal benefits—to same-sex couples. Now, same-sex couples across America are able to exercise their fundamental right to marry, and all states are required to issue and recognize marriage licenses for all couples.

Most weddings have a honeymoon period, and then life returns to ‘business as usual.’ As the celebration (and crosstalk) quiets down, your employees may raise questions about how Obergefell v. Hodges impacts their benefits. Read on, and the next time someone asks you if you know the answer to a same-sex marriage benefits question, you can say: I do!

The Impact of Same-Sex Marriage on Employee Benefits

Federal law provides over a thousand rights and protections to legally married couples. In 2013, the Supreme Court ruled (U.S v. Windsor) to include same-sex married couples in this federal buffet of benefits. But in the years between Windsor and Obergefell, 14 states remained opposed to marriage equality. This created administrative challenges for employers in states that didn’t recognize same-sex marriage.

Marriage equality simplifies benefits administration by allowing employers to consistently apply the same rules to all married couples. Essentially: a spouse is a spouse.

The choice to provide employee spousal benefits has always been at the discretion of private employers. Obergefell v. Hodges simply says: if you choose to insure employees’ spouses, you can’t choose which spouses to insure. To exclude spouses from favorable benefits on the basis of gender is now a violation of the Constitution’s Fourteenth Amendment.

Let’s take a look at how Obergefell v. Hodges affects some of the most common employee health benefits, and what you should do to stay compliant. With a good HRIS, these HR changes won’t take long to implement, but the feel-good effects—for your employees and you—are here to stay.

Health Insurance

The Affordable Care Act mandates that employers offer health coverage to their employees, but there are no requirements for spouses. If you choose to extend medical benefits—like health, dental and vision insurance—to your employees’ spouses, all spouses are now eligible for your coverage. Be aware that this contribution (whether funded by employer or employee) should not be included in the employee’s W2 income, is not taxable to the employee, and is not subject to federal income tax withholding, FICA or FUTA.


What happens to the health coverage of a same-sex spouse in the event of an insured employee’s termination? All employees and their legally married spouses are eligible to continue their health coverage at group rates for up to 36 months. Administer COBRA, just as you do currently.

Cafeteria Plans (FSA, HSA, HRA)

Flexible Spending Accounts (FSA), Health Savings Accounts (HSA) and Health Reimbursement Accounts (HRA) allow for the tax-free reimbursement of a spouse’s medical expenses. Same-sex couples may now contribute to these plans—up to the maximum family contribution. The same qualifying events for changing elections—including marriage, divorce, legal separation, or death of a spouse—apply to same-sex couples.


The Family and Medical Leave Act (FMLA) requires covered employers to provide up to 12 weeks of unpaid, job-protected leave per year for employees who are dealing with their own serious health condition or that of a close family member (including a spouse). These benefits, along with leave for a spouse’s military service, are now inclusive of same-sex spouses.

What This Means For Your Business

The Supreme Court’s ruling in Obergefell v. Hodges may impact how you classify your employees for state tax purposes and whether you extend benefits to their spouses.

  • If you have married employees in the 14 states in which their marriages were not previously recognized (Alabama, Arkansas, Georgia, Kentucky, Louisiana, Michigan, Mississippi, Missouri, Nebraska, North Dakota, Ohio, South Dakota, Tennessee and Texas), you’ll need to change their state tax withholding rates from single to married.
  • If you choose to extend benefits to your employees’ spouses, these benefits are now available to all employees’ spouses. As we head into Open Enrollment season, it’s a great time to review your benefits, plans, and policies. Consistency is crucial, and good communication—using inclusive language—is essential. Keep your employees aware by ensuring that any updated benefits are reflected in your employee handbook.

Streamline and manage your employee benefits. See why companies love Zenefits’ modern HRIS.


Jeremy "Sprout" Brautman is a writer, problem solver, and big fan of growth. When he's not trying to solve problems to help small businesses grow, he can be found developing amenities to increase occupancy at his urban Ladybug Hotel.

Category: Compliance, Benefits

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