Whether you agree or disagree with the June 26 decision by the Supreme Court declaring same-sex marriage a Constitutional right, there are important ramifications for your small business.
Here’s what you need to know.
If You Have a Same-Sex Spouse and One or Both of You Own a Business:
You won’t have to worry about estate struggles related to your business. Legally, your business is now considered a family business, even if you and your spouse are not technically business partners.
Your state’s laws regarding businesses, estates, and prenuptial agreements will determine exactly what this means.
However, the major benefit is that if the business owner or one of the business owners dies, his or her percentage of ownership will transfer to the surviving same-sex spouse, just as it would in a husband-and-wife marriage.
If You Offer Employee Benefits:
Any benefits you currently offer to opposite-sex married couples must now be offered to same-sex married couples.
Small Business Deals
In addition to the obvious, such as health insurance, you’d be surprised how many employee benefits and workplace policies relate to marital status in some way, including:
- Bereavement leave
- Family and Medical Leave Act (FMLA)
- Retirement plans
- Life insurance policies
Go over your employee handbook, benefits enrollment forms, and distribution forms carefully for any mention of spouse or immediate family. These definitions have now changed.
According to Aon Hewitt:
- You may need to make administrative changes to cover same-sex spouses if they weren’t previously covered in your state. This might include changing your consent and/or eligibility forms or adjusting your benefits enrollment processes.
- State income tax treatment of employer-provided benefits could change for employees with same-sex spouses, requiring you to update how you calculate and report taxes. Further guidance on this will be forthcoming from the states.
If You Offer Domestic Partner Benefits to Same-Sex Couples:
Aon Hewitt reports that before the Supreme Court decision, some 77 percent of U.S. companies offered same-sex domestic partner benefits. If you currently do this, the good news is that the Supreme Court decision allows you to streamline your benefits administration (and probably save some money) by eliminating these benefits.
Now that same-sex couples can legally marry in all states, you won’t be discriminating against anyone by removing the domestic partner coverage.
If You Have Employees in More Than One State:
If you were dealing with the administrative headaches of having employees in one state that recognized same-sex marriage and another state that didn’t, your life will be a lot easier.
Benefits, taxes and administrative issues will be handled the same way across all states. Aon Hewitt says this increased administrative consistency will likely be a major benefit for employers.
As always, it’s a good idea to consult your attorney and accountant if you have any questions about how the same-sex marriage ruling affects your business.
In the short run, the Supreme Court’s decision will require making some changes to your benefits plans and redoing some paperwork, which can be a hassle.
However, in the long run, the decision is likely to streamline and simplify benefits management for small businesses. That’s always a good thing, right?
Gay Pride Assembly Photo via Shutterstock