B of A to Extend Health Benefits to Unmarried Partners

Bank of America said Monday that it will offer health and dental benefits to gay and heterosexual partners of employees, becoming the first major U.S. bank to provide such coverage.

The new program, which will be offered to most of the bank’s nationwide work force of 80,000, including 25,000 in the Southland, will allow an employee to enroll one domestic partner or another dependent adult relative, such as a parent, grandparent or sibling. The benefit will begin next January.

BofA’s step was partly prompted by San Francisco’s recent ordinance that penalizes city contractors who do not offer domestic partner benefits. BofA, which is based in San Francisco, is a major contractor with the city.

But the bank’s decision, which followed three years of internal study, was seen as extraordinary because of the breadth of its program and the fact that it took shape in a button-down industry.

“This is an indication that providing coverage to nontraditional members is extending to a conservative industry,” said Michael J. Powers, a benefits consultant at William M. Mercer Inc.

Powers, who heads his firm’s national resource group on domestic partner benefits, said about 400 private U.S. businesses now offer the benefits. Academia and the entertainment industry have led the trend, although American Express and IBM are among the most recent to offer the coverage.

Some companies have limited the extension of benefits to same-sex partners, as Disney did more than a year ago, in the process inflaming a number of conservative groups. But relatively few companies have extended the coverage to include adult dependents such as a grandparent or sibling.

Powers, however, said more companies were considering the broader coverage, perhaps partly to defuse the controversial issues raised by the benefits.

“I think it’s a business issue for most corporations,” said Susan Gore, owner of the Mentor Group, a Dallas-based management and diversity consulting company. “It’s not just doing the right thing, but it’s about attracting and retaining the best and the brightest.”

Dennis Wyss, a BofA spokesman in San Francisco, said Monday that the bank was not calling it domestic partner benefits but rather extended family benefits. Enrollment will start this fall, he said, and employees would need to show they have been in a committed relationship for at least six months with the domestic partner seeking the benefit. To sign up other related adults, employees must verify that that person is claimed as a dependent on an IRS form.

“It’s an acknowledgment that our employees are responsible in supporting a number of extended family members,” Wyss said. The new benefits were not announced publicly by BofA, but revealed in an employee newsletter Monday.

Wyss said it was unclear how many people will enroll a domestic partner or dependent in the program. Companies have found that 1% to 3% of employees sign up for domestic partner benefits, although BofA may experience a higher enrollment because its program is broader. Wyss said the bank does not expect the plan to cost it significantly more.

Analysts said they expect other companies, particularly those contracting with San Francisco, to offer the coverage. Other banks were eager Monday to learn what BofA had offered.

“It’s something we’ve been thinking about [for] over a year,” said Kathy Shilkret, a Wells Fargo spokeswoman. “But we’re not ready to announce any program.”

Richard Jennings, executive director at Hollywood Supports, a group that has pushed studios to offer the benefits, said, “We’ve been talking to a lot of banks and financial services companies about it.” He said BofA’s announcement is “recognition that there are lots of gays and lesbians working in the financial services industry.”

Times staff writer Vicki Torres contributed to this report.