Best Companies of 2010: The Case For a Raise
September 21 2010 12:00 AM ET
The bill’s chances remain uncertain after it was scuttled from health care reform, among other controversial provisions. So with a change to the federal tax code an unsure prospect, Solomon says many companies are asking some fundamental questions, primarily, Why is it our job to do anything about the problem? Would it be good for my company?
“If you’re trying to provide equal pay for equal work pending a government fix—which everyone knows is not going to be easy and has been proposed several times—you’re not going to get there without [grossing up],” Solomon says. As for its advantageousness, he says, “It depends. It can be a competitive advantage if you’re in a large industry that depends on recruitment and retention. And Google, after all, has gotten a lot of good press.”
One employee resource group leader at a Fortune 500 company used the Google headline to push for change within his corporate ranks. “I don’t work for a tech company, but when our group approached executives in June, they were immediately interested,” says the group leader, who asked not to be named because he is not authorized to speak to the media on behalf of his company. “We haven’t yet seen a change in policy, though I do expect one to happen.”
Other gay employee resource groups are more circumspect. “I asked around a bit and the gross-up doesn’t seem to be on the to-do list right now,” says a group leader at a large professional services firm, who also asked not to be identified. “My guess is that there would be encouragement to add a gross-up if that became a criterion on the HRC [Corporate Equality Index].”
Moulton of HRC says that isn’t among new measures in the next iteration of the index, which in 2012 will include revised standards regarding transgender health benefits and equal benefits for same-sex spouses. But barring a legislative remedy, Moulton says gross-ups could be considered for the index in the future.
And yet some companies never waited for the practice to become en vogue. Kimpton Hotels, which operates 50 hotels and 54 restaurants in the United States, began offering gross-ups in 2007. The company has a “large LGBT employee base,” says Leslie Lerude, Kimpton vice president of people and culture (otherwise known as human relations).
“We didn’t seek press for it at the time—it just felt natural for us to do,” she says. “Ultimately we love our LGBT employees, and [the practice] speaks to our culture.”
Witeck says the ultimate fix lies in ending a “hodgepodge of relationship laws” in the United States that ultimately lead to unfair tax and benefits treatment.
“I imagine and expect a tipping point will occur in corporate America that would love nothing more than to have uniformity of employee treatment and taxation,” he says. “The more complex and costly it becomes, and the more companies look for ‘fixes,’ it’s clear the best and most permanent fix for all coupled relations is marriage equality. When will that tipping point arrive? Not sure, but to me it seems inevitable.”