3 Things HR Pros Need to Know about Upcoming Non-Binary Gender Legislation

Last week Thursday, we set sail on the Empress to enjoy the sights and sounds of the San Francisco Bay.

As part of our Vision 2018 San Francisco tour stop, we had a great night with friends, clients and partners.

But just before we took to the high seas, we sat down for a fireside compliance chat with attendees. The hot topic… California SB-179 – The Gender Recognition Act. (Not all surprising being that we were in San Francisco!)

Unfamiliar with the act, don’t worry you are not alone. When asked at a recent Texas Horizon event, not a single person in the room had heard of the upcoming legislation.

Here’s what you need to know. A new California state law (SB 179), effective in September, allows residents to get a driver’s license and/or birth certificate that indicates their gender as male, female, or non-binary. California joins Oregon as the pioneering states to permit a “third gender,” so to speak, on official identification documents.

To put it simply, this is going to be complicated and there are a few things you need to consider when determining how your organization will respond.

1. State legislation likely is preempted by ERISA, so individual state laws may not affect plan practices. While this doesn’t alleviate participant impact considerations, it may affect compliance.
2. In preparation for the September effective date in California, we’ve been performing outreach to carriers; thus far, most we’ve contacted have indicated they will still be requiring male and female designations only. Many carriers have indicated they are actively reviewing this issue and it would not be surprising to see future changes on this front.
3. Additionally, for clients for whom data is submitted to the Centers for Medicare and Medicaid Services or other federal agencies that do not recognize this third gender option, this complicates the issue as well.

As for Benefitsolver, we will support any clients who wish to provide the non-binary option to their employees. If any client wishes to provide this option, the employee can choose non-binary as their gender option and we will work with the carrier to determine how to send that gender over the file. (For example, anyone with a non-binary could be designated as a Female on the file per the carrier’s direction, as some carriers indicate this would decrease claims delays.)

While September seems far away, employers with populations in California need to start forming their plan of action now. Will you be accepting the new gender option? If not, do you have a communication plan for your affected employee population?

Don’t have any employees in California? This could still affect you soon! According to our compliance panel last week, Washington and New York are both on the “watch list” for states that may be implementing similar legislation soon.

There’s no question that this is a very complex and sensitive topic. Our experts here at Businessolver are ready to help.

Are you ready to start the journey towards a new benefits technology partner that can pivot with changing legislation? Check out our Benefits Technology Buyer’s Guide that can get you started.