Employment Law Update

In light of the recently enacted law in Maryland providing for same sex marriage, employers may have questions about health insurance benefits for their employees' same sex spouses.

It is likely that group health plans funded by a Maryland based insurance policy will require that spousal coverage be offered to same sex spouses. If an employer "self-insures" its group health plan, ERISA (the federal law covering employee benefit plans) preempts state laws. Under federal law, an employer can, but is not required to, provide coverage for its employees' same sex spouses.

At the present time, providing coverage to a same sex spouse will result in taxable income to the employee under the federal Internal Revenue Code; the same as providing coverage to an employee's domestic partner. This will be the case unless DOMA (the Federal Defense of Marriage Act) is found to be unconstitutional or until the tax laws are changed. At the present time, taxable income under Maryland law is the same as for federal tax purposes. Accordingly, coverage for a same sex spouse would also result in taxable income under Maryland law. There may be legislation to address this issue in the 2013 Maryland General Assembly session.

We expect further developments in the upcoming months on these issues.

If you have questions contact: