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By ANGELA CHILDERS, a freelance writer based in Chicago

The debate over whether domestic partners or same-sex spouses are entitled to the same employee benefits enjoyed by legally married couples continues in cities, states and at the federal level.

Section 3 defines marriage for federal purposes as that which occurs between a man and a woman only. While lower courts have struck this down in the past as unconstitutional, appeals courts tasked with evaluating Section 3 already had precedents holding that laws singling out people based on sexual orientation could be constitutional if a rational basis existed for their enactment. However, the 2nd Circuit Court of Appeals has no such precedent, which led to the DOJ's decision to end its defense of Section 3.

With respect to company benefits, if DOMA is no longer the law, a same-sex spouse or domestic partner would gain full spousal protections that apply to pensions, 401(k), survivor annuities, tax-free health insurance benefits and more. These same-sex spouses could also override pre-existing beneficiaries, said Paul Hamburger, head of the Washington, D.C.-based Employee Benefits, Executive Compensation and ERISA Litigation Practice Center at Proskauer Rose LLP.

Right now, the question is whether lawmakers or the courts will have the final say on the constitutionality of Section 3. If it's the former, that repeal will be effective at a predetermined date, allowing employers and benefits administrators to implement the necessary changes in an orderly fashion. If the court declares the 15-year-old DOMA unconstitutional, Hamburger questioned whether that would be retroactive. Such as, if an employer refused to provide benefits for their same-sex spouse last year, could the couple recover for that because the courts declared that the law was unconstitutional in the first place?

"It would have been a whole lot cleaner and clearer had the government done this via a repeal of DOMA rather than this mess of having a court declare it unconstitutional," Hamburger said.

With a GOP majority in the U.S. House of Representatives and promises from House Speaker John Boehner to defend the act, repeal is unlikely.

For now, attorneys seem to agree that the best course of action is to do nothing but wait and see how this nondefense plays out in the courts.

"I don't think there's anything with respect to this stance in court that would require employers to change the administration of their plans currently," said J.D. Piro, principal and national practice leader with Aon Hewitt Health & Benefits Legal. "Nothing that I have seen or nothing that the attorney general said has changed the enforcement of DOMA by the executive branch--merely who is going to defend the constitutionality of it in court."

Hamburger advises benefits administrators to keep an eye on similar cases. In the 9th Circuit, a federal worker is fighting for benefits for her same-sex spouse. In Golinski v. U.S. Office of Personnel Management, the U.S. District Court for the Northern District of California denied the plaintiff a preliminary injunction, but noted that the "court would, if it could, address the constitutionality of both the legislative decision to enact Section 3 of DOMA ... or address the conflict regarding the Executive's decision not to defend the constitutionality of the a law it has determined appropriate to enforce."

March 21, 2011

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