In another blockbuster 5-4 ruling authored by Justice Kennedy, in Obergefell v. Hodges, 576 U.S. ___. ____ (2015), the U.S. Supreme Court has held
that the Fourteenth Amendment to the Constitution requires a state to license a marriage between two people of the same sex and to recognize same-sex
marriages validly performed out of state.
Majority Finds Same-Sex Marriage a Constitutional Right that has Evolved Over Time
Justice Kennedy begins the majority opinion − joined by Justices Breyer, Kagan, Sotomayor and Ginsburg − by discussing the history of marriage and changes
in various aspects of the structure of marriage that have “evolved over time.”
The opinion observes that changes have also occurred in the nation’s attitudes toward gays and lesbians, including the evolution of gay rights legislation
and court decisions. The Supreme Court’s decisions show this evolution. In Lawrence v. Texas, 539 U.S. 558 (2003), the Supreme Court held
unconstitutional a state law criminalizing homosexual conduct. Subsequently, in United States v. Windsor, 570 U.S. __, 2013 U.S. LEXIS 4921 (2013),
a 5-4 decision written by Justice Kennedy, held that Section 3 of the Defense of Marriage Act “is unconstitutional as a deprivation of the liberty of the
person protected by the Fifth Amendment of the Constitution.”
The majority notes that states are divided on the issue of same-sex marriage with 17 states recognizing same-sex marriage by virtue of state legislation or
In determining whether marriage is a fundamental constitutional right of same-sex couples protected under the due process clause of the Fourteenth
Amendment, the Supreme Court stated that notions of fundamental rights also evolve over time:
The nature of injustice is that we may not always see it in our own times. The generations that wrote and ratified the Bill of Rights and the Fourteenth
Amendment did not presume to know the extent of freedom in all of its dimensions, and so they entrusted to future generations a charter protecting the
right of all persons to enjoy liberty as we learn its meaning. When new insight reveals discord between the Constitution’s central protections and a
received legal stricture, a claim to liberty must be addressed. Obergefell v. Hodges, 576 U.S. ___, ___ (2015) (slip op. at p. 11)
The Supreme Court noted that the constitutional right to marry was recognized in Loving v. Virginia,388 U.S. 1 (1967), which invalidated bans on interracial
marriage and Turner v. Sofley, 482 U.S. 78 (1987), which held that prisoners could not be denied the right to marry. In the majority’s view, four
principles demonstrate that same-sex marriage is a fundamental right under the Constitution:
- Personal choice regarding marriage is inherent in individual autonomy.
- Marriage is a two-person union unlike any other with respect to the two parties.
- Marriage safeguards children and families and relates to the rights of procreation, childrearing and education.
- Marriage is a keystone of the nation’s social order.
According to the majority, the right of same-sex couples to marry is also derived from the Fourteenth Amendment’s guarantee of equal protection. In the
view of the majority, “[i]t is now clear that [laws prohibiting same-sex marriage] burden the liberty of same-sex couples, and it must be acknowledged that
they abridge central precepts of equality.” Obergefell v. Hodges, 576 U.S. ___, ___ (2015) (slip op. at p. 22)
Concerns about Delay and Religious Objections to Same-Sex Marriage
The majority rejected the argument that the
Supreme Court should proceed with caution and “await further legislation, litigation, and debate,” Id. (slip op.
at p. 23), noting that the issue has been the subject of extensive debate and litigation already. Moreover, “individuals need not await legislative action
before asserting a fundamental right.” Id. (slip op. at p. 24)
Importantly, the majority emphasized the rights of those with religious convictions against same-sex marriage:
Finally, it must be emphasized that religions, and those who adhere to religious doctrines, may continue to advocate with utmost sincere conviction that,
by divine precepts, same-sex marriage should not be condoned. The First Amendment ensures that religious organizations and persons are given proper
protection as they seek to teach the principles that are so fulfilling and so central to their lives and faiths, and to their own deep aspirations to
continue the family structure they have long revered. The same is true for those who oppose same-sex marriage for other reasons. Id. (slip op. at p.
Because the Supreme Court held that a state may not bar same-sex couples from marriage on the same terms as those accorded to couples of the opposite sex, the
Supreme Court also held that a state must recognize a lawful same-sex marriage performed in another state.
Dissents: Legislatures Should Define Marriage and Accommodate Religious Objections
Chief Justice Roberts dissented in an opinion joined by Justices Scalia and Thomas, arguing that in the majority opinion, “[f]ive lawyers have closed the
debate and enacted their own vision of marriage as a matter of constitutional law.” Obergefell v. Hodges, 576 U.S. ___, ___ (2015) (slip op. Roberts
dissent at p. 2) Chief Justice Roberts emphasized that his dissent is “about whether, in our democratic republic, [the decision regarding same-sex
marriage] should rest with the people acting through their elected representatives, or with five [judges].” Id.
(slip op. Roberts dissent at p. 3)
The chief justice expressed concern that the decision might infringe on the right to exercise one's religion under the First Amendment, noting that every
state that enacted laws recognizing same-sex marriage has also provided accommodations for religious practice. Noting that the majority cannot create such
accommodation, Chief Justice Roberts laments that the majority opinion states that “religious believers may continue to ‘advocate’ and ‘teach’ their views
of marriage [but that] [t]he First Amendment guarantees, however, the freedom to ‘exercise’ religion” and that right is not mentioned in the majority
opinion. Id. (slip op. Roberts dissent at p. 28)
Chief Justice Roberts strongly dissented from statements in the majority opinion that laws codifying traditional notions of marriage demean or stigmatize
same-sex couples, rejecting the majority’s implication that persons who hold a traditional view of marriage are “bigoted.”
These concerns were echoed in strongly worded separate dissents by Justices Scalia, Thomas and Alito. Justice Scalia called the majority opinion “a naked
judicial claim to legislative – indeed super-legislative – power.” Justice Thomas argued that the majority disrespected the states’ legislative process and
“threatens the religious liberty our Nation has long sought to protect.”
Justice Alito’s dissent repeated the concerns of the other dissenting justices as well as concerns he expressed in dissent in Windsor, where he
warned that the consequences of recognizing same-sex marriage “are unlikely to be ascertainable for some time” and could potentially undermine the
institution of marriage.
Impact on Employers and Benefit Plans
One of the amicus briefs filed in the Obergefell case came from a coalition of several hundred employers and business groups, urging that a ruling
in favor of same-gender marriage would provide a uniform rule for the business community. Having irregular state marriage laws has caused significant
employee benefits issues for employers. Although Windsor and the guidance issued by the IRS and DOL after that case resolved many issues, employers
have been coping with the cost and administrative burden of complying with different state marriage rules as well as the perception of discrimination,
particularly where the employer’s diversity policies expressly recognize gay and lesbian rights.
Like Windsor before it, the Obergefell holding resolved some issues, but will likely raise some questions from employee plan sponsors
regarding plan requirements under the Employee Retirement Income Security Act (ERISA) and the Internal Revenue Code (Code). The following are issues that
now appear resolved, and issues that need to be addressed in the future:
Health and Welfare Plans
Because state laws governing insured arrangements (health, life, disability, etc.) must now recognize the legality of same-sex marriage, same-sex
spousal coverage will be required under an insured plan if the plan otherwise provides for spousal coverage or benefits.
After Windsor, the Department of Labor (DOL), with a nod from the Internal Revenue Service (IRS), indicated that under ERISA an employer could
decide whether to provide spousal benefits, under a self-insured arrangement including whether to offer same-sex spousal benefits. Following the
holding in Obergefell, same-sex marriage is available to all employees in all states. ERISA does not require spousal coverage or coverage of
same-sex spouses; however, discrimination claims for disparate treatment under an ERISA-covered plan are more likely to prevail, for self-insured
plans. Thus, the ongoing design of self-insured arrangements should be carefully considered.
Plan sponsors that offer “domestic partner” coverage may reconsider offering this benefit. Surveys have indicated that with marriage now legal for
straight and same-sex couples, many employers are considering dropping coverage for unmarried domestic partners. The Obergefell decision
provides a basis to drop domestic partner coverage (state law permitting) and eliminate the need to impute income.
Qualified Retirement Plans and Internal Revenue Code Section 125 Plans
decision held that same-sex spouses must be recognized as spouses for purposes of the tax rules governing tax-qualified retirement plans and the
various types of arrangements subject to Section 125 of the Internal Revenue Code (such as premium conversion plans and flexible spending account
arrangements). The IRS issued guidance specifically addressing the impact of Windsor on such plans, indicating that under federal law any
legally married spouse (as determined by the state or country in which the marriage was celebrated) must be treated as the participant’s spouse for
The Obergefell decision, therefore, does not have much impact for these types of plans. However, employers will need to review their
administrative practices to confirm consistency with Obergefell and consider possible changes to plan documents and participant communications.
Executive Compensation Arrangements
To the extent that an executive compensation arrangement includes spousal provisions, those arrangements would also be subject to the Obergefell
holding and “spouse” would include any legally married spouse.
Leave under the Family Medical Leave Act (FMLA) is generally extended to spouses. Under the Obergefell holding, same-sex spouses will be treated
as spouses for FMLA purposes and therefore an employee may request FMLA leave to care for a same-sex spouse. Several states had recently obtained a
preliminary injunction staying enforcement of DOL’s FMLA rule defining “spouse” to include same-sex spouses whose marriages were valid in the state in
which they were celebrated. Those legal claims now appear moot.
Adoption benefits available to opposite-sex adoptive parents will now be available to same-sex adoptive parents.
Other employee fringe benefits that are extended to spouses − for example, discounts on employer goods or services − will be available to same-sex
Still to Come
Further guidance is expected from the IRS and the DOL regarding the impact of the Obergefell holding on the transition and implementation of
changes to employee benefits administration and plan documentation.
Similar to the challenges to the contraceptive mandate in the Affordable Care Act, there may be a basis for employers with religious objections − for
example, religious schools, institutions and hospitals − to take a position excluding same-sex spouses for purposes of coverage under employment-based
benefits at their organizations.
To read more about the impact of this historic decision on income taxes and estate taxes, see our July 8 Legal Alert “U.S. Supreme Court Holds Same-Sex Marriage To Be a Fundamental Right.”
For further information, please contact the authors of this article –
James P. McElligott Jr.
Sally Doubet King
Jeffrey R. Capwell
− or any other member of the McGuireWoods
employee benefits team