Categorized | Workplace

Work and Family Benefits

Posted on 25 May 2011

Domestic partnership benefits move into the mainstream.

What is a family? Is it a small group of loved ones, bound by time and common experience, or is it a legal and biological construct, meant to draw the line between our “official” and “unofficial” relationships? Most of us prefer the former definition, despite living by the rules of the latter. In some ways, however, those rules are changing.

Certain benefits have always been extended to the spouses and children of employees: medical insurance, relocation expenses, and so on. Those in committed homosexual relationships–lacking the legal sanction of marriage–are left out. Instead of rewarding valuable employees with baseline benefits, the policy tended to further marginalize gays and lesbians.

Now, companies seem to be embracing diversity initiatives, such as domestic partner benefits. “The trend is definitely real,” says Daryl Herrschaft, “and it mirrors broader changes in society.” Herrschaft manages the Worknet project for the Human Rights Campaign (HRC), the largest national gay and lesbian political organization. “Just take a look at the new Census data, for example. The number of unmarried partners has dramatically increased.” Thus, it stands to reason, companies eventually have to reach out to this talent base.

The number of companies offering these kinds of benefits has more than doubled.

Has this change in corporate attitude been driven by competition or compassion? “Probably a little of both,” Herrschaft says. “Competitive benefit packages help companies recruit and retain the best people.” If a benefit package is fair, inclusive, and truly beneficial in real life situations, then people will be interested.

Both Parties Benefit

The Lambda Legal Defense and Education Fund, a national advocacy group devoted to the civil rights of gays, lesbians, and people with HIV/AIDS, goes further than that. It offers a number of convincing arguments for the inclusion of partner benefits in any employment package:

  • The relatively low cost of implementing such a benefit.
  • Fears about HIV-related costs and adverse selection (“less healthy spousal equivalents enrolling at a higher rate than healthy spousal equivalents”) have been proven unwarranted.
  • A fair and equal benefits package promotes morale and company loyalty.
  • Employees are more productive if their families are secure and if they have the full backing and respect of their employer.
  • Companies with such benefits project a positive public image.
  • Employer benefits like this lessen the public burden of health care costs for those who are uninsured.

But there are still a few problems to overcome. Employees who are legally married, for example, must only provide a marriage certificate to qualify their spouse. Domestic partners are routinely required to furnish extensive documentation of their relationship. And, despite avoiding the marriage penalty on federal income tax, domestic partners are swamped in other expenses. According to Lambda: “With domestic partner benefits, employees pay for coverage with post-tax dollars, and then must pay taxes on the employers’ share of payment for the benefits as added income. Married employees pay no taxes on benefits they receive.”

Ahead of the Curve

Which companies have been real pioneers in this area? “IBM is a good example,” Herrschaft says. “They have been moving toward a standard of full spousal equivalency across the board.” Meaning, all rights once reserved for legal spouses (medical, insurance, retirement) are being extended to domestic partners. A move like that–by such a major American player–only helps to prove its real value to employers.

“The number of companies offering these kinds of benefits has more than doubled,” according to the HRC. And companies are doing more than just legitimizing domestic partnerships–they’re fostering corporate diversity in unique ways:

  • Supporting diverse volunteer groups and organizations
  • Donating funds to more inclusive charitable giving programs
  • Supporting federal anti-discrimination law
  • Sponsoring employee resource groups, awareness days, guest speakers, and counseling sessions
  • Training managers and supervisors in diversity issues

There are 3,600 private companies now offering domestic partnership benefits, including more than 120 of the Fortune 500. Besides IBM, the list includes many of the biggest names in corporate America: Coca-Cola, Disney Corporation, Ford Motor Company, Microsoft, RJR Nabisco, and Xerox, to name just a few. You can also find diversity benefits at major labor unions, insurance companies, universities, and state, county, and municipal government offices.

Sometimes, good business also makes good sense. Employers may argue the legitimacy of your family, but fewer and fewer of them are withholding benefits because of it.

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