Here in the United States, large and mid-sized employers are usually self-insured, which means their benefits are governed by laws designed to prevent discrimination based on an employee’s sexual orientation. However, the Employee Retirement Income Security Act ERISA allows companies to bypass some state laws that could complicate healthcare options for employees across the country.
According to recent studies, roughly half of the companies surveyed said they were already providing benefits to same-sex spouses before the recent Supreme Court ruling. But regardless of this surprising fact, experts claim that the lack of clarity in some of the retirement laws could lead to a significant test the gay marriage ruling.
This brings many problems that exist with ERISA into clearer focus. Currently, ERISA requires companies to comply with federal law protecting employees against discrimination based on race, gender or religion. Unfortunately, there is no language preventing discrimination based on sexual orientation or same-sex marriage.
In fact, experts claim that since ERISA was enacted in the 1970s, there is no way lawmakers could ever have contemplated the scope that it would need to cover 40 to 50 years later. These same experts anticipate that many self-insured employers will voluntarily provide the same benefits to same-sex spouses as they do for heterosexual couples.
This is not to say that the issue is resolved with any level of satisfaction within the US legal system. The U.S. Equal Employment Opportunity Commission has recently seen an increasing number of cases involving discrimination against gay or transgender employees. This has prompted legal advocates to push for an update in anti-discrimination rules to include sexual orientation.
One particular case highlighted the problem after a judge ruled that ERISA does not prohibit self-insured employers from excluding same-sex spouses for retirement benefits or any other employment benefits.
As a means to control such blatant discrimination, some plaintiffs are trying to up their odds of making changes by suing employers for violating gender discrimination laws. One particular case was filed against Wal-Mart for excluding same-sex spouses from health coverage. As a result, Wal-Mart began offering health insurance to same-sex spouses last year.
Some executives claim that offering benefits to gay spouses can be an important recruiting tool. As a result, a number of employment experts expect a rise in the number of self-insured employers in order to avoid the risk of being sued for discrimination.
But not all responses about expanding benefits are as welcoming as Wal-Mart. Many conservative Christian groups support the current ERISA legislation and have worked hard to prevent changes. As it currently stands, ERISA allows companies with conservative views on marriage to continue same-sex couples exclusions from benefit plans if they so choose. However, if federal law is amended to include specific protection for sexual orientation that could quickly change.
Changes could have a widespread ripple effect though. Covert discrimination for sexual orientation could still be continued by companies that do not want to offer benefits to same-sex couples. Some of the ways they could do this are by reducing or eliminate benefits for all employee spouses, adding a surcharge for certain spouses or objecting on religious grounds. Action like this could hurt many more employees beyond just same-sex couples.
One particular case that demonstrates the contentious nature of the situation was argued before the Supreme Court in 2014. Hobby Lobby successfully argued that the Religious Freedom Restoration Act allowed them an exemption from covering birth control for employees under the new healthcare laws.
The privately held craft-store chain is a well-known conservative Christian entity. After the recent events, the store released a statement saying that it is evaluating what the gay marriage ruling means for its policies. In the meantime, many same-sex couples have their eye on the current legal situation in hopes that benefits and retirement policy will soon embrace them as well.
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