Up the Creek Without a Marriage License
Employee Benefits about to Be Befuddled by Gay Marriage
By Lisa Baker
When the rice is swept away and gay couples arrive at the
cold, monetary side of matrimony, they may not find happily-ever-after.
In fact, the morning after may find more couples than ever,
whether same-sex or heterosexual, on the outside of fringe benefit plans.
Two Oregon counties—Multnomah and Benton—approved licenses
for gay marriages in March. The state awaits resolution of the issue by the state
Supreme Court, which has been asked to rule on the validity of same-sex
If gay marriage is upheld, Oregonians might expect the
beginning of the next battle, this one over employee benefits plans.
Business representatives and economists say it’s likely that
many companies will balk at any requirement to extend expensive benefit plans
to cover newly minted gay spouses, especially at a time when profit margins
remain uncomfortably thin. They predict companies will choose to dodge the
issue entirely—and save money—by eliminating all spouse benefits altogether.
Faith-based companies could cite
both economic and values-based reasons to do so.
Randall Posdena, an economist with ECONorthwest, says the
trouncing of Measure
30’s tax surcharge, which contained business tax increases as well as
hikes, “shows how little budgetary
room individuals and corporations feel they have as
The twin tide of
recession and rising healthcare costs already has forced many companies to
curtail their benefits plans, either by charging employees higher co-payments
or by limiting dependent coverage.
But if gay marriage
is legitimized, companies that still cover employee dependents will be forced
to cover gay employees’ spouses or risk legal action.
In fact, legal experts say, dropping all spouse benefits
would be the only way to avoid breaking the law, should it mandate equal
treatment for gay marriages.
The picture might not be much rosier at companies that
adopted domestic partner benefits in the 1990s, economists say. Most of those
companies, concerned with the appearance of discrimination, chose to treat all
unmarried couples equally by offering benefits to both gay and straight
partners. But with gay marriage in the offing, it would be cheaper, and less
complicated, to provide only spouse benefits and cease coverage for unmarried
partners, which arguably comprise a larger and therefore costlier population to
In the end, experts say, gay marriage could mean more uninsured
Oregonians than ever. “We will all be
equal, and in the aggregate, worse off,” Posdena says.
Up the Creek Without A Marriage License
Roey Thorpe, executive director of Basic Rights Oregon, the
gay rights advocacy group that succeeded in winning marriage rights from
Multnomah County, said the push for same-sex marriage had nothing to do with
getting benefits and everything to do with equal rights. But she acknowledged
that more unmarried couples could be without insurance than before gay marriage
was available. At the same time, she said, couples—gay or straight—can always
marry to avoid losing their benefits. “They will have a choice to make,” she
That argument riles one of the
gay community’s more ardent supporters.
Dorian Solot, executive director of the Alternatives to
Marriage Project and co-author of the book “Unmarried to Each Other,” says it’s
discriminatory for employers to pick and choose who to cover based on
lifestyle. It was once an argument effectively advanced by the gay community,
she says. Now that the gay community has what it wants, it’s abandoning that
principle. “Wow,” she said. “I think this points out a real difference of
opinion about why domestic partner benefits were offered. Initially, it was for
(nontraditional) families. Now they’re saying it was some temporary thing until
they could get married. It’s very strange.”
Solot concedes that unmarried straight couples have ridden
the coattails of gay rights advocates for years, enjoying the proceeds of their
labor without having to fight on their own. But that could change if gay
marriage results in the end of benefits for straight couples who choose to
Some companies, such as the Oregonian newspaper,
already treat unmarried couples differently, offering benefit packages to
same-sex partners but withholding them from straight partners. It’s a
distinction Solot says is inequitable.
Roger Hennagin, a Lake Oswego employment lawyer, agrees with
Solot. “The policy is based on the sex of the people with whom the employee
associates,” he said. “Seems to me that’s discrimination under the employment
But Stacey Lynch, senior consultant with Tualatin-based HR
Answers, says the policy is allowed under Oregon Bureau of Labor and Industries
guidelines. “The state of Oregon doesn’t think it’s discrimination. The logic
from the Bureau is that heterosexuals
had the option of getting married and same-sex partners did not.”
It is the same
logic behind the state’s family leave law, which allows gay employees to take
time off from work to care for sick partners without the danger of losing their
jobs. The same benefit applies to heterosexual couples, but only if they are
married, a BOLI spokeswoman said.
Straight couples say they see Oregon employers favoring gay
couples at every turn. Even government workers, whose partners are allowed
coverage, see inequality.
Ken Clow, of Salem, says he receives benefits through his
partner, Karla Sanders, who works for state government. But all is not equal,
he says, because his benefits are considered taxable income while gay couples’
benefits are not. “If we were homosexual, they wouldn’t do that. To me, it’s
flat-out discrimination. If they’re going to give it to them, then I’m gonna
have a sex-change operation.” He paused. “I’m just joking about that part.”
Because a majority of those who receive domestic partner
benefits are straight couples, it’s that community that will suffer most if
companies change policies to embrace only marriage—gay or straight, Solot says.
She hopes that the
possible loss of benefits will galvanize the straight population to fight for
itself. “Benefits are a form of compensation for work,” she says. “It flies in
the face of equal pay for equal work” if they are offered to one employee and
then withheld from another on the basis of a worker’s lifestyle.
So far, while there
are many Oregon companies that allow coverage for straight partners, there is
little move in Oregon to approve a mandate for all companies to do so.
Clow, who wrote
letters protesting the treatment of straight couples to U.S. Sen. Ron Wyden,
U.S. Sen. Gordon Smith and to Oregon Rep. Jackie Winters, R-Salem, received no
James “J.L.” Wilson, Oregon state director for the National
Federation for Independent Businesses, says it’s small companies that are
likely to have the most difficulty absorbing additional dependents. Even so, he
says, cost is unlikely to be the only issue driving a decision on benefits
policy. “Gay marriage is such a
wholesale cultural change; most Oregonians disagree with it. They may be
perfectly all right with an employee being gay, but draw the line over having
to apply benefits,” he said. It’s why Wilson believes companies will be looking
for some legal way to opt out of such a policy change.
employers are split between those that already offer gay partners some kind of
benefits package and those that extend benefits only to straight spouses. Few
would say what they will do if the state’s highest court ratifies gay marriage,
saying they prefer to see the ruling before contemplating their response.
Providence Health System, a Catholic-based system of
clinics, hospital and physician’s offices that employs about 14,000 in Oregon,
extends benefits only to spouses of its employees. Spokesman Gary Walker said
the company has not decided what it will do if gay marriage is approved. The
company’s subsidiary, Providence Health Plans, will allow plan benefits to be
extended to domestic partners if an employer with more than 50 workers
specifically asks for it, he said.
Freightliner Corporation nor Fred Meyer Inc.—both top Oregon employers—offer
same-sex benefits to their employees. Company representatives refused to
speculate on their strategies should gay marriage be upheld. Jeff Fisher,
Freightliner spokesman, said his company will not consider a policy change
until it sees how the debate plays out. “We’d want to see the nature of that
discussion, see how it would work,” he said.
Nike Inc. offers
coverage to its employees’ domestic partners, gay or straight. Scott Reames,
spokesman for the company, said the business will not drop any current
covered dependents if gay marriage is upheld. The company employs about 6,000
people in Oregon.
spokeswoman for StanCorp Financial Group, which employs nearly 2,000
Oregonians, said the company provides domestic partner benefits to both gay and
straight couples but is not sure if that policy will continue as is, or if some
The Economics of Gay Marriage
restaurateurs, hoteliers, and caterers exulted in the honeymoon cash following
the rash of gay weddings in downtown Portland.
But soon, analysts say, we will all run into the cold reality of
Posdena, the economist,
says any expansion in the kinds of dependents considered eligible for
benefits–whether straight and unmarried or gay—will cause actuaries to
shift their assessments to cushion their companies against any numerical
risk. Translated: Everyone’s insurance premiums rise as the number of people
covered increases. “And there is the
question of whether same-sex marriages would be arranged for financial
convenience. Not to say that one type of marriage is more corruptible than
another, but any time you increase the total number of dependents, you increase
that risk. The question will be asked, could marriages be arranged so that one
partner who is ill can be covered?”
Posdena said he believes that civil unions or partner
registries are likely more rife with this kind of fudging than marriages “to
the extent they’re viewed as a less dramatic personal step…But there’s no doubt
that the more dependents you create in society, rightly or wrongly, the more
costly the provision of benefits.”
There could also be an effect on government coffers as gay
couples take hold of tax-free pension plans. “The effect on the public is that
there will be some increase in the transfers of wealth that occur without tax,”
The most immediate effect, personnel experts say, is
confusion: Companies are unsure what they should do and when they should do it.
Lynch, of HR
Answers, says she tells her clients to be sure that any action they take as a
result of gay marriage be applied equally to all employees. For instance, she
says, “If someone produces a marriage license, regardless of whether they are
the same or opposite sex (of their partner) they should be covering them under their benefits plan until they hear
otherwise. But there’s a caveat: If you start asking same-sex employees for a
marriage license to prove they are married, you’d better ask for it from
State of Oregon definition of same-sex partners eligible for
family leave benefits, according to Bureau of Labor and Industries:
same-sex domestic partners are not related by blood closer than would bar
marriage in the State of Oregon (first cousins or nearer).
is legally married.
have continuously lived together as a family and share a close personal
relationship, which is exclusive and loving, for an extended period of time,
and they intend to maintain that family and that relationship with each other
for the rest of their lives.
have joint financial accounts and have agreed to be jointly responsible for
each other’s common welfare, including basic
would be married to each other if the law permitted them to marry
are the sole domestic partner of each other and have no other domestic partner.
are both 18 years of age or over.
are each homosexual.
BrainstormNW - May 2004