The Supreme Court’s split five-to-four ruling in Obergefell v. Hodges confirming same-sex couples’ constitutional right to marry spurred supportive statements from some of the nation’s largest sponsors of retirement plans.
Apple and United Airlines were among the companies that issued statements of support in the immediate wake of the decision, which strikes down same-sex marriage bans in 13 states.
When it comes to administering retirement benefits for married same-sex workers, the nation-wide uniformity established with today’s ruling brings welcomed clarity to sponsors of retirement plans, said Annette Guarisco Fildes, CEO of the ERISA Industry Committee, the trade group that represents the interests of the country’s largest retirement plan sponsors.
“The nation’s top employers, many of whom are members of ERIC, will be relieved to be able to treat their employees uniformly, regardless of where they live or work,” said Fildes in a statement.
“ERIC supports the uniformity of common employee benefit rules and policies across the country, as its members operate and provide benefits to their employees in all 50 states. Today’s decision helps our industry with that federally needed consistency,” she added.
In 2013, after the Supreme Court issued a ruling striking down the Defense of Marriage Act in United States v. Windsor, the Department of Labor issued guidance saying the Employee Retirement Income Security Act would recognize same-sex marriages in states that also recognize the legal unions and would also extend protections to same-sex married couples that live in states that don’t legally recognize the unions.
That guidance brought relief to sponsors relative to their employees who are legally married in one state, but reside and work in a state that does not recognize gay marriage.
With Windsor, and the DOL’s subsequent guidance, legally married same-sex couples were guaranteed federal protections on ERISA.
But questions remained for sponsors with employees in states that did not recognize gay-marriage.
They may be most impacted by today’s ruling, according to post on Proskauer’s ERISA practice blog.
“Employers, particularly those operating in states that currently ban same-sex marriage, should review their benefit plans and policies and consider whether any changes need to be made” in light of the decision, according to the post.
The attorneys at Proskauer speculate that the Obergefell ruling will have much more impact on the administration of employee-sponsored heath care benefit plans.
One administrative impact on 401(k) plans could be with respect to those transactions that require spousal consent, such as when a plan participant changes the named beneficiary on his or her plan.
The ruling is also expected to significantly affect how more married same-sex couples apply for Social Security benefits.
Research from Financial Engines, the largest provider of managed accounts to 401(k) plan sponsors, showed the right to marry could mean up to $250,000 more in lifetime benefits for some same-sex couples.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
