Referendum 74, passed in November 2012, updated state law—specifically Chapter 26.60 RCW, State Registered Domestic Partnerships—so that any state registered same-sex domestic partnership in Washington State where neither party is 62 years of age or older, was automatically converted into a marriage as of June 30, 2014, unless dissolved or converted to marriage prior to that date. (More information about civil unions and domestic partnership statutes nationwide can be found on the website of the National Conference of State Legislatures.)
According to an alert from law firm Davis Wright Tremaine, this will impact retirement plans, beneficiary designations and health care plans.
When it comes to retirement plans, same-sex spouses now have the same rights as opposite-sex spouses in Washington State, so that, for example, a same-sex spouse:
- Must consent to any beneficiary designation other than for the same-sex spouse;
- Has spousal rights under the annuity rules;
- Must consent to loans under plans subject to the annuity rules;
- Has more favorable treatment under the required minimum distribution rules regarding timing and value of benefits;
- May roll over benefits to the same-sex spouse’s own individual retirement account (IRA) or another retirement plan;
- Has alternate payee status under a qualified domestic relations order (QDRO) without being a participant’s dependent; and
- May experience an event that qualifies the participant for hardship distributions from a defined contribution retirement plan.
With existing beneficiary designations under retirement plans, the alert explains that as of June 30, existing non-spouse beneficiary designations made by affected employees will no longer be valid. To preserve those non-spouse designations, the employee must complete a new designation form, with the same-sex spouse’s consent to the non-spouse beneficiary.
For example, if an employee named his or her child as primary beneficiary under his or her employer’s qualified retirement plans, and as of June 30 his or her Washington State registered domestic partnership converted to marriage, the new spouse automatically becomes his or her beneficiary, and the former designation of his or her child as primary beneficiary is no longer valid. To reinstate the former beneficiary designation, the employee must re-submit the form with his or her child named as primary beneficiary, and have his or her new spouse provide the appropriate consent.
For health care and welfare plans, this new provision of Washington State law means the same-sex spouse may receive health benefits on a pre-tax basis and will be eligible for special enrollment rights under the employer’s group health plans.
In terms of whether employers are required to provide health and welfare benefits to same-sex spouses, the alert says yes, if it is an insured plan. More information about this aspect of the law, as well as related information about self-insured plans, can be found on the website of the Washington State Attorney General’s Office.