Should your organization offer domestic partner benefits?
Gay marriage, civil unions and the rights of domestic partners have been in the news. If your organization does not yet offer benefits to the domestic partners of your employees, you may be wondering if you should.
With the exception of some city ordinances, organizations are not legally required to offer benefits to a domestic partner of an employee. In California, however, legislation extends the rights and duties of marriage, including the right to employee benefits, to persons registered as domestic partners on and after January 1, 2005. Nevertheless, an increasing number of organizations voluntarily offer domestic partner benefits.
Designing a program. Before designing and implementing a domestic partner benefit program, an organization might want to consider several issues, including:
- What benefits should be offered to domestic partners;
- Who should be eligible to receive these benefits;
- How much will the domestic partner benefit program cost; and
- What are the tax consequences to employees.
Eligibility. In deciding eligibility for domestic partner benefits, an organization should define who is a domestic partner. One decision to be made is whether benefits should be limited to domestic partners that cannot marry under the laws of their state or whether benefits should be offered to all unmarried partners who meet certain requirements.
Typically, organizations offering domestic partner benefits require that domestic partners:
- be over age 18;
- share a committed relationship;
- have an exclusive relationship; and
- be financially interdependent.
Verification. Employers offering domestic partner benefits often require proof of the relationship, such as a written affirmation of the partnership or documents that confirm that the partners reside at the same address (postmarked letters, drivers' license, tax returns, or bank statements). Employers should be careful that the proof of the relationship is relevant and is not an invasion of privacy.
Gay marriage? The overall effect of gay marriage and civil union laws upon employees' benefits plans is not entirely clear.