Google has begun covering the tax that these employees must pay for their partners’ health benefits. The New York Times reports the increase will be retroactive to the beginning of the year, will also cover dependents of the domestic partners, and applies only to workers in the U.S.
Under federal law, employer-provided health benefits for domestic partners are counted as taxable income, if the partner is not considered a dependent. The tax owed is based on the value of the partner’s coverage paid by the employer.
On average, employees with domestic partners will pay about $1,069 more a year in taxes than a married employee with the same coverage, according to a 2007 report by M. V. Lee Badgett, director of the Williams Institute, a research group that studies sexual orientation policy issues, the news report said.
The company began to look at the disparity after a homosexual employee pointed it out, Laszlo Bock, Google’s vice president for people operations (also known as human resources), told the Times. Google says its benefits team seriously considers any suggestions on how to expand its coverage.
Bock said the extra compensation to cover the domestic partner tax will apply only to same-sex domestic partners because heterosexual couples can avoid the added tax by marrying.
After reviewing the fairness of its benefits offerings, the company also decided to make a few other changes that would help homosexual employees, including eliminating a one-year waiting period before qualifying for infertility benefits and including domestic partners in its family leave policy.Bock declined to provide details of what the news benefits would cost the company, but said the decision was less about money and more about equalizing benefits. “If you were to add it all up, it’s not like we are talking hundreds of thousands per employee,” he said. “It will cost some money, but it was more about doing the right thing.”