Section 3 of the federal Defense of Marriage Act Act (DOMA) was declared unconstitutional by a three-judge panel of the First Circuit for the Federal Court of Appeals in Massachusetts v. U.S. Dept. of Health and Human Services. The First Circuit covers Maine, Massachusetts, New Hampshire, Puerto Rico and Rhode Island. The Court discussed equal protection and federalism grounds for its decision and acknowledged the Supreme Court would need to finally decide the matter. Meanwhile, a critical issue for each employer, is the practical effect of this decision on its benefit plans, particularly an employer’s self-funded group health plan.

The case arose when seven same-sex couples lawfully married in Massachusetts and three surviving spouses of such marriages brought suit in federal district court to enjoin pertinent federal agencies and officials from enforcing DOMA to deprive the couples of federal benefits available to opposite-sex married couples in Massachusetts. Thus, the ultimate resolution of the case has significant implications concerning the availability of federal programs and benefits to same-sex couples lawfully married under state law.

Section 3 of DOMA added the following definition to the United Stated Code:

Definition of ‘marriage’ and ‘spouse’ "In determining the meaning of any Act of Congress, or of any ruling, regulation, or interpretation of the various administrative bureaus and agencies of the United States, the word ‘marriage’ means only a legal union between one man and one woman as husband and wife, and the word ‘spouse’ refers only to a person of the opposite sex who is a husband or a wife.

Under this section, and because of the preemption provisions of the Employee Retirement Income Security Act (ERISA), employers could design their ERISA-covered, self-funded group health plans to exclude the same-sex spouse of an employee, while covering the opposite-sex spouse of another employee, even if the same-sex couple was lawfully married under state law. In doing so, employers generally would not be subject to state or local discrimination laws. Additionally, even if such a plan were to permit same-sex spouses to participate, it could deny continuation of coverage rights under the federal COBRA law to such a spouse. By contrast, a fully insured plan that is insured by a policy subject to the laws of a state, such as New York, which requires equity between same-sex and opposite-sex couples may not exclude same-sex spouses if it covers opposite-sex spouses. (And, if such a state also has a COBRA-like requirement under its insurance laws, the same-sex spouse would be entitled to state continuation of coverage rights.) This is because ERISA generally does not preempt state insurance laws.

The First Circuit’s ruling comes not long after President Obama announced support for gay marriage, and his administration stated last year it believed DOMA to be unconstitutional. States with laws permitting same-sex marriage are growing – see Massachusetts, Connecticut, Iowa, Vermont, New Hampshire and New York. Washington D.C. also permits same-sex marriage, and Washington state and Maryland may be next. Moreover, the Court of Appeals for the Ninth Circuit struck down Proposition 8 which denied marriage to same sex partners.

So, the trend seems to be in favor of broader legal protections for same-sex marriage. The cases from the First and Ninth Circuits are likely headed to the Supreme Court and, of course, the result cannot be predicted. However, employers should review their plans and these developments to minimize legal risks for their plans.

Email this postTweet this postLike this postShare this post on LinkedIn
Photo of Joseph J. Lazzarotti Joseph J. Lazzarotti

Joseph J. Lazzarotti is a principal in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. He founded and currently co-leads the firm’s Privacy, Data and Cybersecurity practice group, edits the firm’s Privacy Blog, and is a Certified Information Privacy Professional (CIPP)…

Joseph J. Lazzarotti is a principal in the Berkeley Heights, New Jersey, office of Jackson Lewis P.C. He founded and currently co-leads the firm’s Privacy, Data and Cybersecurity practice group, edits the firm’s Privacy Blog, and is a Certified Information Privacy Professional (CIPP) with the International Association of Privacy Professionals. Trained as an employee benefits lawyer, focused on compliance, Joe also is a member of the firm’s Employee Benefits practice group.

In short, his practice focuses on the matrix of laws governing the privacy, security, and management of data, as well as the impact and regulation of social media. He also counsels companies on compliance, fiduciary, taxation, and administrative matters with respect to employee benefit plans.

Privacy and cybersecurity experience – Joe counsels multinational, national and regional companies in all industries on the broad array of laws, regulations, best practices, and preventive safeguards. The following are examples of areas of focus in his practice:

  • Advising health care providers, business associates, and group health plan sponsors concerning HIPAA/HITECH compliance, including risk assessments, policies and procedures, incident response plan development, vendor assessment and management programs, and training.
  • Coached hundreds of companies through the investigation, remediation, notification, and overall response to data breaches of all kinds – PHI, PII, payment card, etc.
  • Helping organizations address questions about the application, implementation, and overall compliance with European Union’s General Data Protection Regulation (GDPR) and, in particular, its implications in the U.S., together with preparing for the California Consumer Privacy Act.
  • Working with organizations to develop and implement video, audio, and data-driven monitoring and surveillance programs. For instance, in the transportation and related industries, Joe has worked with numerous clients on fleet management programs involving the use of telematics, dash-cams, event data recorders (EDR), and related technologies. He also has advised many clients in the use of biometrics including with regard to consent, data security, and retention issues under BIPA and other laws.
  • Assisting clients with growing state data security mandates to safeguard personal information, including steering clients through detailed risk assessments and converting those assessments into practical “best practice” risk management solutions, including written information security programs (WISPs). Related work includes compliance advice concerning FTC Act, Regulation S-P, GLBA, and New York Reg. 500.
  • Advising clients about best practices for electronic communications, including in social media, as well as when communicating under a “bring your own device” (BYOD) or “company owned personally enabled device” (COPE) environment.
  • Conducting various levels of privacy and data security training for executives and employees
  • Supports organizations through mergers, acquisitions, and reorganizations with regard to the handling of employee and customer data, and the safeguarding of that data during the transaction.
  • Representing organizations in matters involving inquiries into privacy and data security compliance before federal and state agencies including the HHS Office of Civil Rights, Federal Trade Commission, and various state Attorneys General.

Benefits counseling experience – Joe’s work in the benefits counseling area covers many areas of employee benefits law. Below are some examples of that work:

  • As part of the Firm’s Health Care Reform Team, he advises employers and plan sponsors regarding the establishment, administration and operation of fully insured and self-funded health and welfare plans to comply with ERISA, IRC, ACA/PPACA, HIPAA, COBRA, ADA, GINA, and other related laws.
  • Guiding clients through the selection of plan service providers, along with negotiating service agreements with vendors to address plan compliance and operations, while leveraging data security experience to ensure plan data is safeguarded.
  • Counsels plan sponsors on day-to-day compliance and administrative issues affecting plans.
  • Assists in the design and drafting of benefit plan documents, including severance and fringe benefit plans.
  • Advises plan sponsors concerning employee benefit plan operation, administration and correcting errors in operation.

Joe speaks and writes regularly on current employee benefits and data privacy and cybersecurity topics and his work has been published in leading business and legal journals and media outlets, such as The Washington Post, Inside Counsel, Bloomberg, The National Law Journal, Financial Times, Business Insurance, HR Magazine and NPR, as well as the ABA Journal, The American Lawyer, Law360, Bender’s Labor and Employment Bulletin, the Australian Privacy Law Bulletin and the Privacy, and Data Security Law Journal.

Joe served as a judicial law clerk for the Honorable Laura Denvir Stith on the Missouri Court of Appeals.