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Benefits

Court Advances Title VII Case Challenging Health Plan’s Exclusion of Same-Sex Spouses

EBIA  

EBIA  

Jimenez v. Laborer’s Welfare Fund, 2020 WL 5979653 (N.D. Ill. 2020)

Available at https://www.govinfo.gov/content/pkg/USCOURTS-ilnd-1_18-cv-07886/pdf/USCOURTS-ilnd-1_18-cv-07886-0.pdf

A participant in a union-sponsored health plan sued her union, and the welfare fund providing coverage, for sex discrimination, alleging that both violated Title VII by refusing to enroll her same-sex spouse in the plan. In this early proceeding, the court has refused the union’s motion to dismiss and has allowed the case to continue. While much of the court’s opinion focused on whether the union and the fund were appropriate parties for the participant to sue, the court nevertheless offered its view on Title VII’s applicability to the provision of benefits to same-sex spouses. The court stated that in light of the U. S. Supreme Court’s Bostock decision (see our Checkpoint article), there can no longer be any dispute that the conduct alleged constitutes sex discrimination, so long as the other requirements of a Title VII claim are met. The court elaborated that, “had [the participant] been a man seeking spousal coverage for a wife, coverage would not have been denied.” Instead, she did not receive the coverage because “she was a woman seeking coverage for her wife.” Explaining that Title VII requires a “but-for causation test which directs us to change one thing at a time and see if the outcome changes,” the court concluded that the participant’s sex was a but-for cause of the denial of spousal coverage. The case will proceed to trial to determine whether the participant can seek a remedy under Title VII against her union and the welfare fund.

EBIA Comment: While this case was brought against a labor union and welfare fund, the underlying principles apply equally to employers and employer-sponsored health plans, which are clearly subject to Title VII. As this case illustrates, the full implications of Bostock—including its application to employee benefit plans—are evolving in the courts. Plan sponsors considering eligibility and benefit provisions that could be construed as discriminating on the basis of sex should consult their advisors before implementation. For more information, see EBIA’s Employee Benefits for Domestic Partners at Section IV.G (“Impact of Title VII on Plan Design”) and EBIA’s Group Health Plan Mandates manual at Sections XXI.C (“EEOC’s Position on Title VII and Health Coverage”) and XXI.D (“Court Decisions Applying Title VII to Health Coverage”). See also EBIA’s Cafeteria Plans manual at Section XI.B (“Who Is a Spouse for Purposes of Obtaining Tax-Free Health Coverage?”), EBIA’s Consumer-Driven Health Care manual at Section XXII.B.4 (“Who Can Be Provided Tax-Free Benefits?: Spouses and Domestic Partners”), EBIA’s ERISA Compliance manual at Section IX.J (“Spouse and Dependent Child Eligibility”), EBIA’s HIPAA Portability, Privacy & Security manual at Section X.E.2 (“Special Enrollment Rights of Same-Sex Spouses, Domestic Partners, and Their Children”), and EBIA’s Self-Insured Health Plans manual at Section XIV.E (“Beneficiary Eligibility”).

Contributing Editors: EBIA Staff.

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