TD Bank, based in Cherry Hill, N. J., announced this week that it will begin offsetting the tax burden that its LGBT employees pay for domestic-partner benefits.
The bank said Wednesday that it would begin implementing the new pricing Jan. 1.
TD is the latest in a series of corporations that has moved to “gross up” their domestic-partner benefits. Fewer than 50 companies nationwide offer such a program.
Because of the federal and state Defense of Marriage Act, which prevents recognition of same-sex unions, people who have a same-sex partner on their health-insurance plan must pay additional taxes on the value of the benefits — taxes that married heterosexual couples are not subjected to.
“TD Bank is committed to building an inclusive, barrier-free workplace where every employee feels valued, respected and supported,” said TD Bank head of Commercial Management Administration Robert Pompey, who co-chairs the company’s LGBT and Allies Committee. “Offsetting these extra taxes for our LGBT employees makes us more competitive in the hunt for great talent, and it’s the right thing to do.”
Employees with a domestic partner on their plans will receive a one-time, year-end payment equivalent to the taxes the employee pays throughout the year because of the discriminatory law.
Pompey said the payment will be dispersed at the end of 2013 or at the end of the staffer’s employment, whichever comes first.
The program will be open to both full- and part-time employees.
The bank employs more than 28,000 people from Maine to Florida, and Pompey expects the offset program to up the number of those who take advantage of the domestic-partner plan.
“More than 400 employees have a domestic partner enrolled on their plan, but keep in mind that this is before the new policy takes effect,” he said. “The number could very well go up now that we have communicated the policy and informed our employees about it for 2013.”
The bank’s domestic-partner plan has been in place since at least 2008, when TD Banknorth merged with Commerce. The parent company, TD Bank Group, instituted a domestic-partner policy in 1994.
Last month, TD earned a 100 rating from the Human Rights Campaign on the agency’s annual Corporate Equality Index, marking the fourth consecutive year the bank got the top mark.
Pompey said the bank’s customer-service culture, coupled with initiatives like the new offest program, are effective tools to attract and retain the best of the best employees.
“We strongly believe the bank’s new tax-equalization policy for our LGBT employees — along with other policies we already have in place — strengthens TD’s position as an employer of choice in all the markets we serve, including in Philadelphia,” he said. “Our entire bank leadership believes we will ensure the TD of tomorrow is even stronger than the TD of today by attracting employees of all backgrounds regardless of race, gender, sexual orientation, physical ability or religion. People want to work for growing companies that offer a great experience, competitive compensation and benefit packages, opportunities for professional development and companies that have inclusive cultures that welcome people of all backgrounds. TD Bank offers all of this, which we believe strengthens our position to retain and attract the best talent in all the markets we serve.”