Domestic Partnership Benefits and the States

When the Human Rights Campaign began tracking companies offering domestic partnership benefits in 1989, the list comprised less than two dozen entities. Today, there are more than 8000 American companies offering domestic partnership benefits, including roughly 230 of the Fortune 500 companies. Of these companies, 95% offer domestic partnership benefits to both same-sex and opposite-sex couples, while 5% offer the benefits only to same- sex couples.

The fact that most American companies offering domestic partnership benefits do so without regard to sexual orientation does not matter much to those opposed to same-sex marriage. To opponents, domestic partnership benefits are a mere gateway to the full-fledged support of LGBT rights, including the right of same-sex couples to marry.

According to a July 2005 report on www.BenefitNews.com, the cost has very little to do with an employer's decision to offer domestic partnership benefits. A company offering these benefits mainly does so to attract top-tier employees to its workforce. Are domestic partnership benefits offered by companies so that they can remain competitive in their respective industries? Are domestic partnership benefits prohibitively expensive, as some companies allege? How does amending a state constitution to ban same-sex marriage bear, if at all, on a company's decision to offer domestic partnership benefits?

The Debate

The debate over domestic partnership benefits is ever-expanding. In March 2004, representatives of the Vatican and dozens of Islamic nations formally objected to a United Nations Secretariat decision to extend family benefits to some staffers in same-sex unions. In May 2004, the Salvation Army threatened to close soup kitchens for tens of thousands of New York's homeless and walk away from other projects if the city enacted legislation requiring firms that do business with New York to offer health benefits to the partners of gay and lesbian staffers. These two examples alone demonstrate that the fight over domestic partnership benefits is not limited to university campuses and Fortune 500 companies. When the three largest U.S. automakers announced in June 2000 that they would extend health benefits to the partners of gay and lesbian employees, many observers had thought that the tide had turned on this issue and that eventually domestic partnership benefits would become commonplace throughout corporate America.

Over the past 5 years, the debate over same-sex marriage has stirred the pot on the subject of domestic partnership benefits, resulting in fierce debate in a number of state legislatures throughout the country. Litigation on the issue has garnered national media attention. The legal issue can be framed as follows: Does a state's ban on same-sex marriage by way of constitutional amendment affect a company's decision to offer its gay and lesbian employees domestic partnership benefits?

Following is a preview of recent activity in this evolving area of law.

In the States

Alaska

In a unanimous decision in October 2005, the Alaska Supreme Court ruled that it is unconstitutional for the state to continue to deny lesbian and gay state employees and retirees access to equal benefits for their domestic partners. In a case brought by the American Civil Liberties Union (ACLU), the Alaska Supreme Court ruled in Alaska CFU v. State of Alaska that the state's policy of denying lesbian and gay couples equal employee benefits violates the state constitution's equal protection guaranties. The lawsuit was filed in state court in 1999 shortly after voters in Alaska passed a state constitutional amendment barring marriage for same-sex couples. The ACLU argued that, in light of the constitutional amendment, it was unconstitutional for the state to use marriage as the litmus test for public employment benefits.

Siding with the ACLU, the Alaska Supreme Court rejected the state's argument that the denial of domestic partnership benefits to gays and lesbians furthered the state's interest in promoting marriage. The court held that: “[D]enying benefits to the same-sex domestic partners who are absolutely ineligible to become spouses has no demonstrated relationship to the interest of promoting marriage.”

Michigan

In September 2005, in a victory for same-sex couples in Michigan, a state judge ruled that public employers were not prohibited from offering domestic partnership benefits to employees. In National Pride at Work v. Granholm, the ACLU filed a lawsuit on behalf of 21 same-sex couples who were in danger of losing health care benefits after the state adopted a constitutional amendment banning marriage for same-sex couples. Michigan Gov. Jennifer Granholm (D) had initially announced that domestic partnership benefits for employees and their families would be withheld, stating that a legal cloud existed over the interpretation of the constitutional amendment. Michigan Attorney General Mike Cox (R) soon entered the fray, issuing a nonbinding opinion that the constitutional amendment banning same-sex marriage barred cities in Michigan from offering domestic partnership benefits in future contracts. The ruling this past September affirmed that Michigan voters never intended to take health insurance away from their families when the constitutional amendment banning same-sex marriage was passed.

On Nov. 16, 2005, the Michigan Court of Appeals halted the ruling in National Pride at Work v. Granholm, granting the state attorney general's request to temporarily set aside the lower court ruling until the higher court had a chance to review the case. Although it is not a judgment on the merits of the case, the most recent decision of the Michigan Court of Appeals is a clear sign that the issue is far from over, and that in all likelihood, the case will wind up before the Michigan Supreme Court.

Missouri

All over the country, similar suits are being filed, as the legal debate over domestic partnership benefits widens. In Missouri, on Aug. 10, 2005, a lawsuit was filed in Buckner v. City of Kansas City, challenging Kansas City's registry for domestic partners (both gay and straight). Kansas City created this registry so that city employees who registered as domestic partners would be eligible to receive the benefits accorded to married partners of city workers. In the lawsuit filed this past summer, the Alliance Defense Fund argues that Kansas City cannot write a law that is unconstitutional, pointing to Missouri's 2004 amendment to ban same-sex marriage.

Montana

In Montana, a major blow to domestic partnership benefits occurred in September 2005 when Blue Cross and Blue Shield of Montana, the largest health insurer in the state, announced that it is ending coverage for unmarried domestic partners in its small-group plans. The decision affects employers who purchased Blue Cross/Blue Shield's small-group coverage (companies with two to 50 employees). In justifying its decision, the company pointed to the Montana Supreme Court's 2004 decision in Snetsinger v. Montana University, in which the court ruled that the state must provide lesbian and gay employees of the University of Montana System with the option of providing health insurance and other employee benefits for their domestic partners. That lawsuit was filed by the ACLU in February 2002, arguing that it was unconstitutional to deny same-sex couples access to health insurance, disability coverage, and other benefits available to married employees and even to committed opposite-sex couples that signed an affidavit of common-law marriage. In its recent decision to eliminate coverage for unmarried domestic partners in its small-group plans, Blue Cross and Blue Shield of Montana decided that it could no longer extend coverage to any unmarried domestic partner of a covered employee, regardless of that employee's sexual orientation, and pointed to the decision of the Montana Supreme Court as the basis for its decision.

Ohio

In July 2005, an Ohio state appellate court ruled against a constitutional challenge to the domestic partnership registry that was established in 2003 by the city of Cleveland Heights. The unanimous decision in City of Cleveland Heights ex rel. Jimmie Hicks v. City of Cleveland Heights rejected a bid by a dissident city council member to get an injunction against operation of the registry.

The Cleveland Heights registry provided official recognition for unmarried partners, but it conferred no statutory rights other than to be listed in the registry. No partnership benefits were conferred on partners of municipal employees, and no entity was required to refrain from discriminating against registered partners. In reality, the registry amounted to a symbolic method of providing a public record that a partnership existed.

Just weeks before the city was to open the registry in January 2004, a city councilman filed a lawsuit seeking a state court injunction. His argument was that the city did not have the authority under the state constitution to establish the registry. The trial judge rejected this argument, and the councilman appealed. A three-judge panel of the 8th Ohio District Court of Appeals held that the registry affected only the municipality itself and had no extraterritorial effect. The taxpayers of the city incurred no cost since the registering couples paid a fee to cover the entire cost of the registry, and foreign jurisdictions were not bound to acknowledge the registry or to confer any rights or obligations. While the court of appeals acknowledged that some companies had used the registry in the administration of their own domestic partnership benefits program, this was not a problem because it did not involve conferring any rights by statute.

Surprisingly, there was no consideration by the court of appeals of whether the registry violated the anti-marriage amendment passed by Ohio voters in November 2004. And, in an ironic postscript, the city council member who fought against the voter-approved domestic partnership registry recently lost re-election to an openly gay candidate.

Conclusion

Cases involving the constitutional collision of domestic partnership benefits and same-sex marriage are on the rise, and almost certainly will expand new legal frontiers as more challenges are decided over the constitutionality of the federal Defense of Marriage Act, and if debate over the Federal Marriage Amendment intensifies. Because there are over 1000 federal statutory provisions classified to the United States Code in which benefits, rights, and privileges are contingent on marital status or in which marital status is a factor, the battle over domestic partnership benefits, both at the federal and state level, will continue to shape the dynamic area of same-sex partnership law.

When the Human Rights Campaign began tracking companies offering domestic partnership benefits in 1989, the list comprised less than two dozen entities. Today, there are more than 8000 American companies offering domestic partnership benefits, including roughly 230 of the Fortune 500 companies. Of these companies, 95% offer domestic partnership benefits to both same-sex and opposite-sex couples, while 5% offer the benefits only to same- sex couples.

The fact that most American companies offering domestic partnership benefits do so without regard to sexual orientation does not matter much to those opposed to same-sex marriage. To opponents, domestic partnership benefits are a mere gateway to the full-fledged support of LGBT rights, including the right of same-sex couples to marry.

According to a July 2005 report on www.BenefitNews.com, the cost has very little to do with an employer's decision to offer domestic partnership benefits. A company offering these benefits mainly does so to attract top-tier employees to its workforce. Are domestic partnership benefits offered by companies so that they can remain competitive in their respective industries? Are domestic partnership benefits prohibitively expensive, as some companies allege? How does amending a state constitution to ban same-sex marriage bear, if at all, on a company's decision to offer domestic partnership benefits?

The Debate

The debate over domestic partnership benefits is ever-expanding. In March 2004, representatives of the Vatican and dozens of Islamic nations formally objected to a United Nations Secretariat decision to extend family benefits to some staffers in same-sex unions. In May 2004, the Salvation Army threatened to close soup kitchens for tens of thousands of New York's homeless and walk away from other projects if the city enacted legislation requiring firms that do business with New York to offer health benefits to the partners of gay and lesbian staffers. These two examples alone demonstrate that the fight over domestic partnership benefits is not limited to university campuses and Fortune 500 companies. When the three largest U.S. automakers announced in June 2000 that they would extend health benefits to the partners of gay and lesbian employees, many observers had thought that the tide had turned on this issue and that eventually domestic partnership benefits would become commonplace throughout corporate America.

Over the past 5 years, the debate over same-sex marriage has stirred the pot on the subject of domestic partnership benefits, resulting in fierce debate in a number of state legislatures throughout the country. Litigation on the issue has garnered national media attention. The legal issue can be framed as follows: Does a state's ban on same-sex marriage by way of constitutional amendment affect a company's decision to offer its gay and lesbian employees domestic partnership benefits?

Following is a preview of recent activity in this evolving area of law.

In the States

Alaska

In a unanimous decision in October 2005, the Alaska Supreme Court ruled that it is unconstitutional for the state to continue to deny lesbian and gay state employees and retirees access to equal benefits for their domestic partners. In a case brought by the American Civil Liberties Union (ACLU), the Alaska Supreme Court ruled in Alaska CFU v. State of Alaska that the state's policy of denying lesbian and gay couples equal employee benefits violates the state constitution's equal protection guaranties. The lawsuit was filed in state court in 1999 shortly after voters in Alaska passed a state constitutional amendment barring marriage for same-sex couples. The ACLU argued that, in light of the constitutional amendment, it was unconstitutional for the state to use marriage as the litmus test for public employment benefits.

Siding with the ACLU, the Alaska Supreme Court rejected the state's argument that the denial of domestic partnership benefits to gays and lesbians furthered the state's interest in promoting marriage. The court held that: “[D]enying benefits to the same-sex domestic partners who are absolutely ineligible to become spouses has no demonstrated relationship to the interest of promoting marriage.”

Michigan

In September 2005, in a victory for same-sex couples in Michigan, a state judge ruled that public employers were not prohibited from offering domestic partnership benefits to employees. In National Pride at Work v. Granholm, the ACLU filed a lawsuit on behalf of 21 same-sex couples who were in danger of losing health care benefits after the state adopted a constitutional amendment banning marriage for same-sex couples. Michigan Gov. Jennifer Granholm (D) had initially announced that domestic partnership benefits for employees and their families would be withheld, stating that a legal cloud existed over the interpretation of the constitutional amendment. Michigan Attorney General Mike Cox (R) soon entered the fray, issuing a nonbinding opinion that the constitutional amendment banning same-sex marriage barred cities in Michigan from offering domestic partnership benefits in future contracts. The ruling this past September affirmed that Michigan voters never intended to take health insurance away from their families when the constitutional amendment banning same-sex marriage was passed.

On Nov. 16, 2005, the Michigan Court of Appeals halted the ruling in National Pride at Work v. Granholm, granting the state attorney general's request to temporarily set aside the lower court ruling until the higher court had a chance to review the case. Although it is not a judgment on the merits of the case, the most recent decision of the Michigan Court of Appeals is a clear sign that the issue is far from over, and that in all likelihood, the case will wind up before the Michigan Supreme Court.

Missouri

All over the country, similar suits are being filed, as the legal debate over domestic partnership benefits widens. In Missouri, on Aug. 10, 2005, a lawsuit was filed in Buckner v. City of Kansas City, challenging Kansas City's registry for domestic partners (both gay and straight). Kansas City created this registry so that city employees who registered as domestic partners would be eligible to receive the benefits accorded to married partners of city workers. In the lawsuit filed this past summer, the Alliance Defense Fund argues that Kansas City cannot write a law that is unconstitutional, pointing to Missouri's 2004 amendment to ban same-sex marriage.

Montana

In Montana, a major blow to domestic partnership benefits occurred in September 2005 when Blue Cross and Blue Shield of Montana, the largest health insurer in the state, announced that it is ending coverage for unmarried domestic partners in its small-group plans. The decision affects employers who purchased Blue Cross/Blue Shield's small-group coverage (companies with two to 50 employees). In justifying its decision, the company pointed to the Montana Supreme Court's 2004 decision in Snetsinger v. Montana University, in which the court ruled that the state must provide lesbian and gay employees of the University of Montana System with the option of providing health insurance and other employee benefits for their domestic partners. That lawsuit was filed by the ACLU in February 2002, arguing that it was unconstitutional to deny same-sex couples access to health insurance, disability coverage, and other benefits available to married employees and even to committed opposite-sex couples that signed an affidavit of common-law marriage. In its recent decision to eliminate coverage for unmarried domestic partners in its small-group plans, Blue Cross and Blue Shield of Montana decided that it could no longer extend coverage to any unmarried domestic partner of a covered employee, regardless of that employee's sexual orientation, and pointed to the decision of the Montana Supreme Court as the basis for its decision.

Ohio

In July 2005, an Ohio state appellate court ruled against a constitutional challenge to the domestic partnership registry that was established in 2003 by the city of Cleveland Heights. The unanimous decision in City of Cleveland Heights ex rel. Jimmie Hicks v. City of Cleveland Heights rejected a bid by a dissident city council member to get an injunction against operation of the registry.

The Cleveland Heights registry provided official recognition for unmarried partners, but it conferred no statutory rights other than to be listed in the registry. No partnership benefits were conferred on partners of municipal employees, and no entity was required to refrain from discriminating against registered partners. In reality, the registry amounted to a symbolic method of providing a public record that a partnership existed.

Just weeks before the city was to open the registry in January 2004, a city councilman filed a lawsuit seeking a state court injunction. His argument was that the city did not have the authority under the state constitution to establish the registry. The trial judge rejected this argument, and the councilman appealed. A three-judge panel of the 8th Ohio District Court of Appeals held that the registry affected only the municipality itself and had no extraterritorial effect. The taxpayers of the city incurred no cost since the registering couples paid a fee to cover the entire cost of the registry, and foreign jurisdictions were not bound to acknowledge the registry or to confer any rights or obligations. While the court of appeals acknowledged that some companies had used the registry in the administration of their own domestic partnership benefits program, this was not a problem because it did not involve conferring any rights by statute.

Surprisingly, there was no consideration by the court of appeals of whether the registry violated the anti-marriage amendment passed by Ohio voters in November 2004. And, in an ironic postscript, the city council member who fought against the voter-approved domestic partnership registry recently lost re-election to an openly gay candidate.

Conclusion

Cases involving the constitutional collision of domestic partnership benefits and same-sex marriage are on the rise, and almost certainly will expand new legal frontiers as more challenges are decided over the constitutionality of the federal Defense of Marriage Act, and if debate over the Federal Marriage Amendment intensifies. Because there are over 1000 federal statutory provisions classified to the United States Code in which benefits, rights, and privileges are contingent on marital status or in which marital status is a factor, the battle over domestic partnership benefits, both at the federal and state level, will continue to shape the dynamic area of same-sex partnership law.