Mass. Businesses Argue DOMA Hurts Profits, Company Culture

Dozens have been camping out for days in front of the U.S. Supreme Court for a seat to watch oral arguments in a same-sex marriage case that start Tuesday. (Jacquelyn Martin/AP)

Dozens have been camping out for days in front of the U.S. Supreme Court for a seat to watch oral arguments in a same-sex marriage case that start Tuesday. (Jacquelyn Martin/AP)

BOSTON — The U.S. Supreme Court will hear a challenge to the Defense of Marriage Act this week. And 34 Massachusetts businesses and organizations are joining nearly 300 companies across the country in asking the justices to strike down the law, saying it hurts their bottom lines.

‘Bad For Business’

The number of companies and business organizations filing the brief is so high that the appendix of their names is longer than the written argument. When Sabin Willett, of the Boston law firm Bingham McCutchen, was done writing the brief, he sent it to a printing shop in New York.

“The printer, he said, ‘All these pages and pages of corporations, you know what that’s gonna cost? My God,’ he says, ‘Do you have to list them all?’ I said, ‘That’s the whole point!’ ”

Mass. businesses are among the 278 organizations that argue DOMA is bad for business. Click for a PDF of the brief. (Curt Nickisch/WBUR)

Mass. businesses are among the 278 organizations that argue DOMA is bad for business. Click for a PDF of the brief. (Curt Nickisch/WBUR)

The list of 278 organizations covers a broad cross-section of corporate America. On the list is Johnson & Johnson, Facebook, Starbucks and Citigroup. There’s Apple, Nike, Morgan Stanley and Levi Strauss. And among the Massachusetts companies are Boston Scientific, Shawmut Construction, Bain & Co. and Eastern Bank. They’re all asking the U.S. Supreme Court to throw out the Defense of Marriage Act. Willett says the argument is pretty simple.

“In five words,” Willett said, “what this brief says is: DOMA is bad for business.”

The Defense of Marriage Act prevents same-sex couples from getting medical coverage and other tax and retirement benefits that straight employees get for their spouses. And that complicates matters for employers such as MassMutual Financial Group, says Mark Roellig, the general counsel of the Springfield company.

“So when you start dealing with issues of tax withholding or payroll taxes or workplace benefits, we’re basically treating people differently,” Roellig said.

Roellig says MassMutual does not want to discriminate. But when his company gives same-sex employees the same spousal benefits that any other employee gets, DOMA forces the company to report that as income. It’s not tax-deductible. So same-sex couples pay more in taxes. And MassMutual pays more in FICA taxes. That’s not only expensive and unfair, Roellig says, keeping track of this dual system also costs his company time and money.

“You have to keep separate sets of books,” Roellig said. “You have to be continually adjusting those books and those plans. And then also picking up the potential legal risk if you make a mistake. So it’s ongoing administrative costs that are pretty significant.”

Creating A Diverse Workforce 

That’s not the only business reason that MassMutual and other local companies oppose DOMA.

“In order to compete in today’s global competitive environment, we believe at State Street the sort of secret sauce is to have a diverse workforce,” said Hannah Grove, an executive at the Boston financial services firm.

Grove says DOMA damages her company’s ability to create the inclusive, equitable work environment that State Street needs to succeed in the marketplace.

“You know, our employees are one of our greatest assets,” Grove said. “And engaged workforce begets that innovation, that collaboration. That benefits our shareholders; it benefits our clients.”

Corporate Acceptance 

“Cultural change takes time, and I think this is the time,” said Paul Guzzi, the head of the Greater Boston Chamber of Commerce, which also signed the brief opposing DOMA.

Guzzi admits it hasn’t even been 10 years since Massachusetts legalized same-sex marriage, but he says the change in corporate acceptance is clear.

“So the actual track record, if you will, of major companies that have long recognized now gay marriage, who have provided benefits independent of sexual preference. It has worked!” Guzzi said.

So, nearly 300 companies and business groups, including the 34 in Massachusetts, are asking the court to strike down DOMA. They say it hurts their bottom lines. The number of companies that filed a brief arguing DOMA is good for business? That number is zero.

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  • http://www.facebook.com/bkort Barry Kort

    I have posted a link to this story on Volokh Conspiracy, where the issue is being discussed by top academics in the legal professions.

  • LianeSperoni

    Businesses don’t support or oppose gay marriage, people do. Within any business there are employees who are entitled to their own opinion- as a gay person, I am highly skeptical of these claims. I don’t think businesses should speak for all their employees, even if I disagee with their opinions.

  • http://www.facebook.com/lakebrat Lee Ann Tavares

    As always it is always about the Benjamin’s. At least this time it is a win-win. We are all created equal!! It makes no sense to me why people oppose gay marriage. Two people who love each other should have the right to get married. Key word PEOPLE!!!

  • Argentus

    Why do we need “top academics”, Barry? (btw, long time no see). This is a simple issue that needs to be realized by the people, academics be damned. Business will lead the way because it needs to. Morality evolves afterward, when people realize their own beliefs aren’t necessarily the best thing for everybody. BTW: Barq’s root beer does have a Q. :)

  • crescentfang

    If DOMA is bad for business than any special treatment for married people would have to be also. Why should two guys sharing an apartment be discriminated against because they aren’t gay. And what about live in lovers with kids who don’t want to marry and pay the “marriage tax”? If these businesses don’t think families are worth supporting, they should admit it. They are just greedy SOB’s who care only about their bottom line. Keeping them under control is why we have laws in the first place.

  • http://www.facebook.com/walter.ziobro.5 Walter Ziobro

    Businesses ought to be free to construct their own benefit plans without government interference. They should not be compelled (as under the health care laws) or prohibited (as under DOMA) from offering specific types of benefits to their employees.

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