Employers should review their benefit plans and programs to ensure that their plans are properly drafted to reflect the intended coverage or exclusion of same-sex partners and compliance with applicable laws.
On May 26, 2009, the California Supreme Court upheld Proposition 8, the November 2008 ballot measure that amended the California state constitution to define marriage as a union between a man and a woman. Notably, however, the court unanimously ruled that the more than 18,000 same-sex marriages performed in California during the brief interval when same-sex marriage was legal in California will continue to be valid and recognized under state law. In 2008, the California Supreme Court ruled that state laws limiting marriage to opposite-sex couples violated same-sex couples' right to equal protection of the laws as guaranteed by the state constitution prior to the Proposition 8 amendment. For more information on the court's 2008 decision, click here.
The Court's Analysis of Proposition 8
In voting 6-1 to uphold the validity of Proposition 8, the California Supreme Court had to analyze whether Proposition 8 was a "revision" to the state constitution—which requires approval by at least two-thirds of both houses of the state legislature before going to voters—or an "amendment," which can proceed directly to voters without prior legislative approval. The court determined that Proposition 8 is not a revision to the constitution because it does not alter the nature of the government plan or framework set forth in the state constitution.
The court acknowledged that its decision to uphold Proposition 8 could be viewed as at odds with its 2008 decision. However, the majority opinion asserted that Proposition 8 carved out a narrow exception to state constitutional rights of equality and privacy, "reserving the official designation of the term 'marriage' for the union of opposite-sex couples . . . but leaving undisturbed all of the other extremely significant substantive aspects of a same-sex couple's state constitutional right to establish an officially recognized and protected family relationship."
Proposition 8's Impact on Prior Same-Sex Marriages
In unanimously deciding to recognize the same-sex marriages performed prior to the passage of Proposition 8, the court determined that there was insufficient evidence that voters intended for Proposition 8 to have a retroactive effect. The court examined the materials provided in the ballot pamphlet mailed to voters in advance of the election and the ballot itself, and determined that the language was "insufficient to demonstrate, clearly and unambiguously, that the voters must have intended a retroactive application." According to the court, same-sex couples who entered into marriages prior to the passage of Proposition 8 did so in reliance on the law as it existed at that time, and to retroactively invalidate their marriages would deprive these couples of vested rights without the due process of law. Therefore, same-sex couples who married in California prior to November 4, 2008, will continue to be legally married and will continue to be entitled to all of the rights, benefits and protections that California law affords to legally married spouses.
Implications for Employee Benefit Plans
From an employee benefits perspective, the immediate impact of the court's ruling is that approximately 18,000 same-sex marriages have been ruled valid (unlike the same-sex marriages performed in San Francisco in 2004). As a result, employers will need to review their employee benefit plans to determine whether changes are necessary or desirable in light of the fact that spousal benefits may be provided indefinitely to a limited number of same-sex couples. For instance, employers may need to revise eligibility descriptions in summary plan descriptions (SPDs) and enrollment forms to address the types of same-sex marriages eligible for spousal benefits. In addition, employers will have to be careful and specific in defining the term "spouse" in their benefit plan documents and SPDs.
More broadly, the California Insurance Equality Act already requires insurance plans to offer spousal equivalent benefits to registered domestic partners in California. Because this act remains intact after Proposition 8, same-sex partners will continue to receive protection and coverage under insurance plans in the state, so long as they register their domestic partnership under California law. However, it is important to note that the California Insurance Equality Act does not apply to self-funded plans, plans that are insured using insurance contracts issued outside of the State of California or other types of employee benefit programs (such as qualified and nonqualified retirement plans).
Employers should review their benefit plans and programs in light of the California developments to ensure that their plans are properly drafted to reflect the intended coverage or exclusion of same-sex partners and compliance with applicable laws.
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