Chuck Burton/Associated PressBank of America’s corporate headquarters in Charlotte, N.C.
A look at the financial realities of same-sex partnerships.
Bank of America’s new monthly debit card feehas been roundly criticized in recent weeks. But a new change in corporate policy change is likely to receive a much warmer reception.
Starting next year, the nation’s largest bank will begin reimbursing its employees with same-sex partners for the extra taxes they pay for health insurance — something that their married heterosexual co-workers don’t have to worry about because the federal government recognizes them as an economic unit.
A growing number of companies have begun to adopt the policy. Google was one of the earlier adopters, and several other technology companies, law firms, consultancies and others followed suit. But there are still only a handful of big financial services firms that have begun reimbursing their employees with same-sex partners. Last we checked, that group includedBarclays, Goldman Sachs, Credit Suisse and BNP Paribas.
Why is there even a need for such a policy?
Under federal law, employer-provided health benefits for domestic partners are counted as taxable income, if the partner is not considered a dependent. On top of that, the employees cannot use pretax dollars to pay for their premiums — unlike their opposite-sex married counterparts.
So while many big companies offer health insurance coverage for domestic partners, it costs employees more money to use it. To level the playing field among gay and heterosexual employees, many companies are covering the extra costs.
Like several other firms, Bank of America is only covering the costs for same-sex partners and their dependents. Many companies choose only to cover same-sex couples since heterosexual domestic partners have the option to marry and avoid the extra taxes.
The banking giant will provide the reimbursement once a year, and it will be calculated for each employee on an individual basis. “We regularly review our benefits plans to ensure they meet the diverse needs of our employees,” said Ferris Morrison, a spokeswoman for the bank.
Do you think Bank of America’s move will pressure other big financial firms to follow suit? If you know of any other companies that recently adopted the policy, please drop their names in the comment section below, so we can track them down and add them to our chart tracking companies’ progress.
