Ernst & Young and its affiliates have begun reimbursing lesbian, gay, bisexual and transgender employees for any additional federal and state taxes they incur for their same-sex domestic partners’ medical benefits in the U.S., starting Jan. 1, 2012.
E&Y is joining a small but growing number of employers around the country in offering this benefit to their LGBT employees. However, E&Y said Monday it is the first of the Big Four accounting firms to offer the perk, which is meant to underscore the firm’s commitment to LGBT inclusiveness and perhaps serve as a recruiting tool.
Under federal law and many states’ laws, same-sex couples face extra taxes when their partners are covered by health insurance, as many states do not recognize same-sex partnerships. The extra taxes are mandated even for married same-sex couples, costing lesbian and gay employees an average of $1,500 in extra taxes annually. Married heterosexual couples are exempt from such taxes, prompting E&Y and other companies to provide equitable benefits.
According to the Human Rights Campaign, one of the largest civil rights organizations for LGBT people, only 30 for-profit employers provided these tax equalization benefits as of December 2011.
“Ernst & Young strives to promote an equitable work culture in every way possible,” said E&Y Americas inclusiveness officer Karyn Twaronite in a statement. “Our decision to provide this tax gross-up reinforces our long-standing pledge to foster a work environment that is inclusive for all of our people and signals our ongoing efforts to remain a leader in providing equitable benefits.”