Benefit Discrimination based on Marital Status

There have been more than a few situations in which spouses who are both employed within the same organization have been declined access to benefits because an employer “thought” they need only offer benefits to one or the other, but not both.

This is just one example of a liability which could lead to a lawsuit.

When a corporation decides to offer an employee group benefit plan, they do so through a signed contract. In this, an employer is agreeing to follow the terms of the contract and this means offering the package, in many cases, on a mandatory condition of employment to ALL ELIGIBLE employees.

Discriminating between employees, their dependents, beneficiaries, or survivors with regard to their age, sex, or marital status is prohibited. This rule of anti-discrimination applies to almost every employee benefits plan.

Another area where marital discrimination occur is within common-law, same-sex unions. In some situations this is not made problematic by the employer not allowing coverage, but more a matter of improper communication. The employee never informed the employer because the timeline to when a common-law partner would be eligible hadn’t been clearly defined and so by the time the common-law partner was added to the plan, they were considered a late applicant. Whereas had proper communication taken place, the partner would have been added without medical evidence being required and in some cases benefits declined as a result of the medical.

Employee benefits apply for all employees equally except in very few cases. Even companies with the best intentions can make discrimination mistakes. In addition to marital status, some common discrimination mis-steps include:

• Age – If full-time active employees who meet the criteria of coverage are at least 18 to aged 65 they are the same.
• Sex – Benefits are gender irrelevant and are not distinguished for being, or not being, the primary wage earner.

Because insurance is designed to minimize risk, don’t let benefits become a liability. Attention to detail and proper documentation are critical in your interactions with plan members to avoid putting your company at risk

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