U.S.

Supreme
Court
Recognizes
Fundamental Right To Same-Sex
Marriage; And Also Holds That The
Fair Housing Act Protects Against
Disparate Impact - Unintentional
Discrimination
By: Lawrence P. Postol, Vice President For Legislative Affairs
Lpostol@seyfarth.com
U.S. Supreme Court Recognizes Fundamental Right To Same-Sex Marriage
In a landmark decision on June 26, the U.S. Supreme Court recognized a fundamental
right for same-sex couples to marry throughout the country. In a 5-4 opinion authored by Justice
Anthony Kennedy, the Court held that the Due Process and Equal Protection Clauses of the
Fourteenth Amendment require the states to license a marriage between two people of the same
sex.
In Obergefell et al. v. Hodges, No. 14-556, the Court decided four consolidated cases that
presented two questions: first, whether the Constitution requires states to issue marriage licenses
to same-sex couples; and second, whether states must recognize same-sex marriages performed
elsewhere. The Court answered both questions in the affirmative. On Due Process grounds, the
Court stated four reasons why the Constitution guarantees same-sex couples the right to marry:
(1) the right to personal choice regarding marriage is inherent in the concept of individual
autonomy; (2) the right to marry supports a two-person union unlike any other in its
importance to the committed individuals; (3) the right to marry safeguards children and
families and thus draws meaning from related rights of childrearing, procreation, and education;

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and (4) marriage is a keystone of [the Nations] social order for which there is no difference
between same-sex and opposite-sex couples.
The Court also relied on the Equal Protection Clause to reach its decision, but with
substantially less analysis. This is relevant because while previous Court decisions on LGBT
issues had relied on the Equal Protection Clause, they had not articulated what standard of
review (i.e., rational basis or heightened scrutiny) applies to classifications based on sexual
orientation. Todays decision likewise did not explain what standard of review applies to such
classifications, and therefore the precedential impact of this decision on other issues may be
difficult to gauge.
Furthermore, the opinion expressly recognized the First Amendment rights of religious
organizations and individuals to oppose same-sex marriage. Thus, there may be a latent conflict
between the fundamental right to marry laid out in this opinion, and the expansive view of
religious liberty laid out in opinions like Burwell v. Hobby Lobby Stores, Inc.
Impact on Employers
With todays ruling, same-sex couples may now legally marry throughout the country.
For multi-state employers that had previously been subject to a non-uniform mixture of state and
federal laws regarding the recognition of their employees same-sex marriages, todays ruling
should provide administrative simplicity, as same-sex marriages are now legally valid in all 50
states.
Employers should be aware that compliance with various federal laws (such as the
Family Medical Leave Act and its state counterparts), same-sex spouses will now have to be
treated the same as opposite-sex spouses.

Likewise, compliance with any state laws that

implicate marital status will also require treating same-sex spouses the same as opposite-sex

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spouses. However, there is one curious result that will occur in states that do not extend antidiscrimination protections to LGBT individuals in employment: gay or lesbian individuals are
now able to lawfully wed, but employers in some states may still be able to fire them because
their LGBT status is not explicitly protected under state or federal law. However, the Justice
Department has opined the LGBT status is protected under Title VII, and of course some state
and city laws protect LGBT status, and thus it is likely that any adverse action by employers
based on LGBT status would be very risky.
Although the tone of todays decision was sweeping, the reach of it will remain to be felt.
For example, although it is clear that the states must recognize same-sex marriage, it is not clear
that private employers are required to do so where policies do not flow from federal or state law.
However, policies that treat opposite-sex spouses differently from same-sex spouses may become
subject to legal challenge, as todays decision will likely become a basis for litigation to further
expand the reach of laws such as Title VII.
Benefits Implications
The primary impact of this decision from the employer benefit plan perspective will be
on health and welfare benefits. This decision does not result in a change for employers qualified
retirement plans because after the United States v. Windsor decision in 2013 (which struck down
part of the federal Defense of Marriage Act), the IRS issued guidance providing that for federal
tax purposes the IRS applied a state of celebration rule. As a result, qualified retirement plans,
which rely on the Internal Revenue Code definition of spouse, have already been considering
same-sex spouses as spouses for purposes of those plans. Todays ruling may impact the
number of people who are considered spouses, but should not require a qualified retirement plan
change.

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The Supreme Courts decision will impact, however, some employers health and welfare
benefits design and administration. After the Windsor decision, employers who offered same-sex
spouses health and welfare benefits were able to treat those benefits as non-taxable for federal
tax purposes. In those states that did not previously recognize same-sex marriage, however,
those benefits may have been subject to state taxes. This created a disconnect in that some samesex spousal welfare benefits were taxable for state tax purposes but not for federal tax purposes
resulting in the potential for participant confusion and administrative burden for the plan sponsor.
With the Supreme Courts ruling upholding same sex marriage, those benefits should no longer
be taxable for federal or state tax purposes which should ease administration for employers.
In addition, employers who had previously defined spouse for purposes of their welfare
plans based on a state definition, should revisit those definitions to see if changes in
administration are necessary. Employer welfare plans that continue to define spouse for
purposes of welfare benefits to exclude same-sex marriages may have an increased chance of
facing legal challenge in light of todays ruling, such as through an attempted expansion of the
reach of Title VII noted above.
With this change in the law, employers should undertake a review of their offered
employee benefit plans, including a review of the definition of spouse in plan documents.
They should also reevaluate their own internal policies and training materials to ensure that they
adequately address new employee leave rights, and application of existing law protecting
employees based on marital status.

Dissent

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For followers of the Supreme Court, the four dissenting opinions, particularly of Justices
Roberts and Scalia were interesting. Throwing the usual decorum of the Court out the window,
Justices Roberts and Scalia attacked the majority Justices in a rather vicious and somewhat
personal rebuke. Justice Scalia in particularly argued that the Constitution cannot protect gay
marriage, because it was unheard of when the Constitution and Bill of Rights were written. Of
course, if that logic were accepted, slavery would still be legal, because it was permitted when
the Constitution was written. As smart as Justice Scalia is, he seems to have missed (or ignored)
the point that the principles of Due Process and Equal Rights Under The Law were intended to
expand and adapt to new issues that develop over time. That is why the U.S., unlike many other
countries, does not need to rewrite its Constitution repeatedly over time.
Justice Scalia also argued that the Supreme Court cannot decide issues because the Court
is not elected, and is not representative of the people, arguing the Court is a group of highly
educated group smart lawyers, and as such, they are not representative of the people. Again,
Justice Scalia ignores, no doubt intentionally, the fact that the Constitution and Bill of Rights
protects certain unalienable rights, which the majority cannot take away, no matter what the
popular sentiment is. Lest we forget, these include freedom of speech and freedom of religion.
So the question cannot be that the Supreme Court is not permitted to protect the minority from
the majority, indeed that is one of the fundamental purposes of the Supreme Court (who by the
way, while appointed, are appointed by elected officials - the President with the Senates
consent). Rather the issue is whether the right to marry is a fundamental right, which the
Supreme Court today found it is, and given how strong the opinions are on both sides of the
issue, one has to say they got it right by finding it is indeed a fundamental right.

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Fair Housing Act Protects Against Disparate Impact - Unintentional Discrimination

The U.S. Supreme Court also on June 26, and again in a 5 - 4 decision, ruled that the Fair
Housing Act (FHA) permits the use of a major antidiscrimination tool, the legal theory of
disparate impact. A disparate impact claim is based on what is sometimes called unintentional
discrimination. The fundamental allegation is that a policy or practice, which is
nondiscriminatory on its face, is unlawful if it has a disparate impact on a legally protected group
and does not serve a substantial legitimate nondiscriminatory interest, or that interest is otherwise
attainable with lesser adverse impact.The far more common discrimination theory is disparate
treatment, which requires proof of intentional discrimination.
The Supreme Court first approved the disparate impact theory in 1971, in employment
discrimination cases under Title VII of the 1964 Civil Rights Act. Every federal appellate court
that has decided the issue since then has held that disparate impact claims also are permitted in
housing discrimination cases under the FHA, a part of the 1968 Civil Rights Act. The Supreme
Court in Texas Department of Housing and Community Affairs v. The Inclusive Community
Project, Inc., Case No. 13-1371 upheld that view.
The main question for the Court was whether the antidiscrimination text of the FHA was
written broadly enough to prohibit disparate impact claims. Justice Anthony Kennedy, writing for
the Court majority, favorably compared the FHA text to both the 1964 Civil Rights Act and the
Age Discrimination in Employment Act of 1967, both of which the Court had previously held
permitted disparate impact claims.
The key in all three statutes, according to Kennedy, was their reference to the
consequence of actions (the essence of a disparate impact claim) and not just to the mindset of
actors or an actors intent (i.e. intentional discrimination). He also found that the 1988 Fair

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Housing Amendments Act trumped any contrary interpretation by specifically barring disparate
impact claims in a few narrow circumstances, which served to legitimize it for others.
Required Elements
Justice Kennedy also reiterated multiple Supreme Court pronouncements from previous
disparate impact cases concerning the inherent limitations on such claims. Each of the required
critical elements has to be established: that there is an actual policy or practice; that there is a
disparate impact on a protected group; that the policy or practice actually causes the disparate
impact; that the policy or practice does not serve a valid interest; or that the valid interest is
otherwise attainable with lesser adverse impact. Justice Kennedy maintained that these
requirements would circumscribe the array of potential disparate impact claims.
Recommendations
This decision confirms that the disparate impact theory remains a viable fair housing tool.
So businesses and other entities in the housing industry must redouble their efforts to ensure that
any policies or practices which have a disparate impact on a protected group also serve a
substantial legitimate nondiscriminatory interest, not otherwise attainable with lesser adverse
impact. It is also a remainder that in all employment areas, employers must be aware of policies
or practices which have a disparate impact on protected groups, e.g. requiring all police officers
to be over 6 feet tall would have a disparate impact on women, who generally are shorter than
men. Thus, when protected classes are underrepresented in the work force, employers need to
make sure that a policy or practice, which cannot be justified as having a legitimate purpose, is
not the cause of the underrepresentation.

2015 by Lawrence Postol

Mr. Postol is the Vice President for Legislative Affairs on the NOVA SHRM
Board, and a partner in the Washington, D.C. office of Seyfarth Shaw LLP. If you
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have any questions about the information in this article, you may e-mail Mr. Postol
at Lpostol@seyfarth.com or call him at 202-828-5385.
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