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“Because of Sex” - U.S. Supreme Court to Hear LGBT Employee Discrimination Cases
Tuesday, 14 May 2019
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“Because of Sex” - U.S. Supreme Court to Hear LGBT Employee Discrimination Cases

On April 22, 2019, the United States Supreme Court announced it would hear arguments on three high-profile employment-related cases next term, all involving the issue of whether sexual orientation and transgender status are considered protected under federal anti-discrimination laws.

Under the federal law, Title VII of the Civil Rights Act of 1964, it is an unlawful employment practice to discriminate against applicants or employees “because of” someone’s sex, among other protected classifications. The statute does not specifically mention sexual orientation, transgender status or gender identity in the actual text. Lower federal courts across the country have been split on the issue of whether Title VII actually bars discrimination based on sexual orientation or gender identity.

This question about the interpretation of Title VII and its applicability to sexual orientation and gender identity has been a large, looming question for the past several years, and the time is ripe for this issue to be settled. The petitions received from three different cases were presented to the U.S. Supreme Court justices, who will hear the arguments in October 2019. The cases are not expected to be decided until sometime in 2020. Currently, the U.S. Supreme Court has a conservative majority, with the relatively recent additions of associate justices Brett Kavanaugh and Neil Gorsuch, who were nominated by President Donald Trump.

Of note, the Equal Employment Opportunity Commission (“EEOC”), the federal agency responsible for enforcing federal anti-discrimination laws, takes the position that it is a violation of Title VII to discriminate against workers on the basis of their sexual orientation or on the basis of gender identity, including transgender status. The EEOC supports its position as consistent with applicable Supreme Court cases, such as Price Waterhouse v. Hopkins from 1989, which hold that employment actions motivated by gender stereotyping constitute unlawful sex discrimination. However, the federal Department of Justice opposes the EEOC’s stance. It states that the EEOC’s position about the scope and applicability of Title VII to categories not mentioned in the statute does not have the force and effect of law and is entitled to no deference beyond that agency’s power to persuade.

Two of the three cases up for review deal with the question of whether sexual orientation discrimination constitutes a form of discrimination "because of . . . sex," in violation of Title VII of the Civil Rights Act. One of those two cases is Altitude Express, Inc. v. Zarda, out of the 2nd Circuit Court of Appeals, involving a claim by a former employee, Zarda, against his former employer, Altitude Express, alleging that he was terminated from his position as a skydiving instructor based on his sexual orientation. In that in that case the court adopted the EEOC’s view and held that Title VII prohibits sexual orientation discrimination. The second of the three cases up for review is Bostock v. Clayton County, Ga., out of the 11th Circuit Court of Appeals, which dealt with Bostock, a gay man and county employee, who became involved with a local gay recreational softball league, and was fired several months later on the basis of “conduct unbecoming of a county employee.” In that case, the court held that Title VII does not ban sexual orientation discrimination. As one can see, these two lower courts reached opposite conclusions on the issue.

The third case, R.G. & G.R. Harris Funeral Homes v. EEOC, out of the 6th Circuit Court of Appeals, involves the question of whether Title VII prohibits discrimination against transgender people based on either (1) their status as transgender; or (2) sex stereotyping under Price Waterhouse v. Hopkins. The Harris case dealt with a funeral director (formerly known as Anthony Stephens) who worked for the funeral home employer for six years before making the announcement about transitioning from male to female. She was fired several weeks after she informed her boss of her transition. The 6th Circuit Court of Appeals ruled that the word “sex” in Title VII includes “gender identity” and held that discrimination of the basis of transgender violates Title VII. Of note, the EEOC considers the term “transgender” to refer generally to gender nonconforming individuals, especially those whose gender identity (i.e., inner sense of being male or female) or gender expression (i.e., outward appearance, behavior, and other such characteristics that are culturally associated with masculinity and femininity) is different from the sex assigned to the person at birth.

Another recent development is that the EEOC has a new chair, Janet Dhillon, who was appointed by President Trump and approved by the U.S. Senate on May 8, 2019, after a several year impasse over her nomination due to concerns that she would seek to change the EEOC’s position on LGBT issues and rights. Many business groups backed Dhillon, who has worked as an in-house lawyer for JCPenney, Burlington Stores, and US Airways.

Employer Takeaway
It is clear that the current state of the law regarding LGBT rights is disjointed, and eyes are on the U.S. Supreme Court this fall to resolve the outstanding issue of whether sexual orientation and transgender status are protected by Title VII’s prohibition of employment discrimination on the basis of sex. While the EEOC’s current view that Title VII does prohibit discrimination on the basis of sexual orientation and transgender status/gender identity is considered guidance, it is not followed by all courts in the nation hearing these types of issues in employment cases. Therefore, it is still a best practice for employers to include a prohibition of sexual orientation and/or transgender discrimination and harassment against applicants or employees in its policies, procedures and employment-related practices. In addition, anti-harassment and anti-discrimination training for all managers and supervisors can help to raise awareness of sexual harassment and sex discrimination generally, and ultimately, this can help to prevent employment-based claims of discrimination and harassment overall. Within the next year, employers will certainly have more clarity and direction, but until then, employers should continue to follow best practices.

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