The Supreme Court ruled in favor of The Defense of Marriage Act and Prop 8. Those who enter a same-sex marriage under California now will now be recognized as legal spouses under Federal Tax Laws. This is only applicable to those who are married. Palm Springs Corporate Lawyers are encouraging employers to raise awareness within the workforce and to treat same married same sex employees in the same regards as the treat heterosexual married employees.
Here at the Palm Springs Corporate Law Firm we believe that communication is a key element in the success of this transition. Palm Spring corporate attorneys urge employers to discuss any possible changes in all relevant aspects of day-to-day operation and benefits to decrease the risk of employer breaching their fiduciary duties. It is imperative for the employer to intervene and help employees who are not otherwise taking action to protect their own interest.
Palm Springs Corporate Law firm’s Explanation of what will change in regards to benefits in the workforce:
Prior to this ruling of the supreme court group plans in the state of California would allow an employees registered domestic partner to be covered by employee health insurance. Often these plans covered non-registered partners. The difference is that previously this was not considered as a pretax benefit with the exception of those who financially qualified as a dependent under Federal Law.
The premium could be reported as a W-2 income to the employee in the event that the partner was not classified as a dependent under federal law. This could potentially raise the amount of income to be taxed of the employee. This aspect will remain the same for those partners who remain unmarried but change for those same-sex partners who are married. Married couples will now have the benefit of not being taxed for spousal premiums. Palm Springs corporate attorneys suggest that this status change should be immediately be relayed to the employee and the withholding should be adjusted.
Employers will now be able to extend the Federal COBRA coverage to those who are in same-sex marriages. California allows this to be extended to those covered and who are in domestic partnerships (registered or non-registered) as well.
In event that a same-sex employees spouse’s relative has an important medical circumstance that requires a leave the employer must recognize this in the same regards that it would another family under the FMLA act. The Family Medical Leave Act states that the employer must allow the employee a leave of absence in such event. The Department of Labor stands behind this change but has stated that eligibility is dependent on the state that the couple lives. California does however recognize this change.
Under 401K and other retirement plans a new beneficiary designation to any individual other than the spouse will now require a written and signed statement of the spouse. If this signature is not completed the assigned beneficiary designation will not be validated. If an employee who is engaged in a same sex marriage does not have an assigned beneficiary the spouse will typically be the beneficiary by default. These terms should be relayed to the employee and necessary changes should be made to ensure accuracy in regards to the employee’s preferences.
In some cases spousal consent is a requirement for loans against retirement benefit or pre-maturity retirement distribution benefits. In these cases spousal consent in writing will be required.
