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Same Sex? Same Benefits: Ninth Circuit upholds health benefits for domestic partner of federal employee

The changing political and legal landscape concerning same-sex benefits is an area private employers should monitor closely. A case involving a federal employee provides a recent example. In In re Margaret Fonberg, the Executive Committee of the Ninth Circuit ruled that a federal law clerk in Oregon, who was denied health benefits for her same-sex domestic partner, was discriminated against on the basis of her gender and must be compensated.

Margaret Fonberg and her same-sex partner are registered under the Oregon Family Fairness Act as domestic partners. In 2009, during the annual open enrollment benefits period, Fonberg attempted to enroll her domestic partner in her employer-offered family health plan, but the United States Office of Personnel Management (OPM) denied her request.

Fonberg filed an Employment Dispute Resolution (EDR) Complaint in the U.S. District Court of Oregon, alleging discrimination on the basis of her sex. Initially, Chief Judge Ann Aiken held that the denial of health benefits to Fonberg’s partner on the basis of sex violated the district’s EDR plan. Judge Aiken ordered the district to provide her with a reimbursement allowance for the cost of providing Fonberg’s partner with health insurance coverage comparable to that offered spouses or similarly-situated judicial employees. Chief Judge Aiken also awarded Fonberg retroactive relief for past health insurance costs for her partner.

Almost two years later, Chief Judge Aiken rescinded her order for reimbursement because, as she stated, “no legal method for reimbursement is currently available . . . [and] the law affords Fonberg no remedy in this matter.” Chief Judge Aiken further ruled that, because Fonberg and her partner were not married, there was no authority within the Ninth Circuit to permit her to order reimbursement of the cost of health benefits for Fonberg’s domestic partner.

On appeal, the Executive Committee of the Ninth Circuit Court noted that OPM’s denial had relied on the recent Supreme Court decision in United States v. Windsor, which had held that only married same-sex couples were protected by the Constitution.

The Executive Committee found that Fonberg and her partner were treated differently in two ways. First, they were treated differently from opposite-sex partners who are allowed to marry and thereby gain spousal benefits under federal law. The Executive Committee concluded that this was plainly discrimination based on sexual orientation, which the District of Oregon’s EDR plan prohibits. The Executive Committee also found that they were treated unequally compared to same-sex couples in other states in the circuit, who may marry and, thus, gain benefits under Windsor. According to the Executive Committee, Oregon law suffered from precisely the same deficiency that the Supreme Court identified in Windsor with respect to the Defense of Marriage Act. Therefore, both these forms of discrimination were prohibited under the Oregon EDR plan.

According to the Executive Committee, the distinction drawn by OPM based on the gender of the participants in the union amounted to discrimination on the basis of sex under the District of Oregon’s EDR plan and, under Windsor, constituted a deprivation of due process and equal protection. For those reasons, the Committee overturned Chief Judge Aiken’s order and directed the Clerk of Court to reimburse Fonberg for back pay in the amount of $6,190.90 plus interest.

While this decision only applied to a federal employee in Oregon, private employers should review and consider their options with regard to same-sex partner benefits. In this current litigious environment, it is critical for every employer to understand the significance of state and federal developments and weigh the potential consequences that may result.



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