Google takes an extra step on same-sex benefits

July 2, 2010 6:49:40 PM PDT
A Google employee pointed it out, and the company responded. As of today, the search engine giant is going to provide its employees additional pay to offset the tax liability for same-sex benefits.

It's a tax that heterosexual couples don't pay and averages about $1,069 for gay and lesbian couples. Experts in the tax and legal field we've surveyed say Google isn't the first to do this, although no one could name any others.

There is a national business coalition seeking to reform the tax law to eliminate the inequity. The coalition includes Charles Schwab, HP, Intel, Levi Strauss and PG&E. Google is not listed as a member.

"We are working with Google right now in their exploring their ability to join the coalition," Daryl Herschaft from the Human Right's Campaign said. The Washington, D.C. based company tracks company benefits for same-sex couples, and its extensive database indicates that a majority of the Fortune 500 publicly traded companies have been providing benefits to same-sex partners over the past four years. A cursory review of the database indicates that Adobe Systems, Apple, Cisco, Electronic Arts, HP and Yahoo are among them.

"I think it's really significant that Google wants to be known as a company that treats all of its employees fairly and in this case, that includes picking up the slack when the federal government doesn't recognize the diversity in today's work force," Daryl Herschaft from the Human Right's Campaign said.

Google turned down a request to do an interview about its new policy. While the change is effective today, the additional pay, known as a "gross-up," will be retroactive to January 1. It is not known how many employees will benefit.

"If you get coverage for your partner and let's say it's worth $10,000, that's $10,000 in extra income. If you're in the 30 percent bracket, you'd be paying $3,000 of income tax on that, but you also pay payroll taxes on that," Santa Clara University Law School Professor Patricia Cain, PhD., said.

Google already is well-known for providing generous benefits to its work force, such as free gourmet food and on-site laundry facilities. Silicon Valley companies are fiercely competitive in recruiting and retaining talented employees, and Google's new benefit may spur other tech firms to do the same.


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