It’s been a busy month for those keeping an eye on one of the most pressing questions in employment law:  whether Title VII, which prohibits sex discrimination in employment, also inherently prohibits discrimination on the basis of gender identity.

Last week, the US Department of Justice argued to the Supreme Court that workplace discrimination on the basis of gender identity is legal.  However, the Department requested the Court delay deciding whether to hear an appeal on this issue until it decides a similar question: whether Title VII prohibits discrimination on the basis of sexual orientation.

In contrast, Victoria Lipnic, Chair of the Equal Employment Opportunity Commission, has said she hopes the Supreme Court takes up a case on the issue of whether Title VII’s prohibition of sex discrimination forbids discrimination on the basis of an employee’s gender identity.  This position diverges from the position articulated by the Department of Justice:

“There’s a lot of litigation going on on this, we have lots of people who have filed charges with the EEOC that we have taken in,” Lipnic said. “I’m always in favor of clarity.”

The DOJ’s brief argued against the Sixth Circuit’s March ruling that Title VII’s bar on discrimination “because of … sex” blocks employers from firing workers based on their gender identities. The ruling revived a suit the EEOC filed for former Harris funeral director Aimee Stephens alleging the company violated the law by firing her after she started living as a woman.

The brief reversed the EEOC’s lower court stance that Title VII protects transgender workers from discrimination. Although the EEOC argues its cases at the district and circuit courts, the DOJ speaks for the agency at the Supreme Court . . .

The EEOC voted unanimously in 2012 to adopt its stance that Title VII covers gender identity. Lipnic, who voted for coverage, told Law360 that she doesn’t know whether the EEOC will revisit its interpretation of the statute if President Donald Trump’s nominees to two commission vacancies are confirmed. She had earlier said she’ll be keeping a close eye on what the high court says . . .

The DOJ’s brief urges the high court to wait on the funeral home’s petition until it decides whether to answer a related question about whether Title VII covers sexual orientation. If it opts to take up that issue, the justices should grant cert to Harris, the DOJ said. If it doesn’t, the justices should not, it said.

Meanwhile, congressional leaders speaking on behalf of over 200 members of the United States House of Representatives have strongly signaled a desire to move forward with the Equality Act in the next Congress.  The Equality Act seeks to expressly add sexual orientation and gender identity to Title VII’s protected characteristics.

Watch this space: these developments have been happening quickly, and we will continue to cover what this all means for employers as more information becomes available.

The Michigan Civil Rights Commission has taken significant action to clarify that its state statute prohibiting discrimination in employment on the basis of sex (among other characteristics) extends to prohibit employment discrimination based on orientation and gender identity:

The Michigan Civil Rights Commission voted 5-0 to approve a statement legally interpreting the Elliott-Larsen Civil Rights Act’s ban on “discrimination because of . . . sex” to include discrimination against sexual orientation or gender identity . . .

The idea of an interpretive statement from the commission, initially requested by Equality Michigan last year, was revived after the 6th Circuit Court of Appeals ruled in favor of a transgender woman who said she was illegally fired by a funeral home in Garden City while transitioning from male to female . . .

The [Michigan Department of Civil Rights] will begin taking complaints related to sexual orientation or gender-based discrimination.

Regular readers of our blog will be familiar with this particular legal issue, as we have previously discussed the question of whether bans on sex discrimination necessarily also ban discrimination on the basis of sexual orientation and/or gender identity in the context of federal law.  This legal question is a hot topic in employment litigation in federal courts across the country.  Because of widely divergent outcomes in federal district and circuit courts across the country in addressing this question, we will likely have to wait until the U.S. Supreme Court weighs in to have a definitive interpretation of federal law.

Irrespective of the federal question, however, there appears to be a trend toward states considering this issue in the context of their own non-discrimination laws.  The Michigan Civil Rights Commission’s decision is similar to proposed guidance announced by the Pennsylvania Human Relations Commission from late 2017.  This development is important because a Supreme Court decision on this issue under federal law may not necessarily prove binding on states’ interpretations of state law.

We will, of course, continue to monitor this issue as it develops around the country.

Query: a longtime employee, who has previously identified in your workplace as female, begins dressing for work like a man, grooming according to male standards, and identifying as male.  He begins to make arrangements to have his name formally changed, and a number of other legal documents changed as well.  He also begins using the men’s room at work.  Other coworkers complain about “a woman using the men’s bathroom at work.”  What do you do?

According to the U.S. District Court for the District of Nevada, what you do not do is: 1) ban him from the men’s bathroom for being biologically female, 2) ban him from the women’s bathroom for identifying as male, and 3) require him to use only gender-neutral bathrooms.  Last week, the court made headlines when it granted summary judgment against a school district, on a Title VII sex discrimination claim brought by one of the district’s police officers.  (Roberts v. Clark County School District, No 2:15-cv-00388-JAD-PAL, ECF No. 147).

While the court denied summary judgment as to the officer’s retaliation and hostile workplace claims, it noted that established case law holds that sex stereotyping is prohibited sex discrimination under Title VII.  In this case, the court noted that the district banning the officer from using the women’s bathroom “because he no longer behaved like a woman” was direct evidence of impermissible sex stereotyping.

Also of note: in granting partial summary judgment, the court held that Title VII’s prohibition against sex discrimination includes both sex and gender.  At this point, some of our readers might be somewhat confused at the difference between sex and gender. Citing language from the Ninth Circuit, the court noted the difference between these key terms, in recounting the case law history in this area:

These early cases distinguished between the term ‘sex’, which referred to an individual’s distinguishing biological or anatomical characteristics and the term ‘gender’, [which] refers to an individual’s sexual identity, or socially-constructed characteristics.

The court’s language is significant because it simultaneously rejected the school district’s argument to draw legal distinctions based on these terms:

Although [the district] contends it discriminated . . . based on his genitalia, not his status as a transgender person, this is a distinction without a difference here. [The officer] was clearly treated differently than persons of both his biological sex and the gender he identifies as–in sum, because of his transgender status.

Moreover, the court held that the bathroom action alone was a sufficiently adverse employment action — in that “access to restrooms is a significant, basic condition of employment” — to involve Title VII protections.

We have previously discussed two separate theories that the EEOC and plaintiffs have used to argue sexual orientation and/or gender identity are incorporated into Title VII’s ban on sex discrimination.  These theories have had a mixed track record of success, and there is no certainty in predicting how they will continue to play out in the coming months and years.

Still, a key takeaway from this case is that employers should retain knowledgeable counsel to advise on employee workplace transitions.  Effective transition management can not only help defuse potential workplace tension and avoid litigation, but it can also lead to a more productive workplace, happier employees, and keeping pace with the market’s movement in this direction.

Title VIIAs my colleague Christina Stoneburner posted yesterday and today, North Carolina recently enacted the Public Facilities Privacy & Security Act, which, among other similar state laws that continue cropping up (such as the recently vetoed religious exemption bill in Georgia), curtails protections based on Lesbian, Gay, Bisexual, and/or Transgender (LGBT) status.  These proposed laws have drawn significant media attention and are likely to continue expanding and developing in the foreseeable future.  However, despite these local exceptions, please remember that federal law may still apply.

The Equal Employment Opportunity Commission (EEOC) has taken an aggressive position on sexual orientation and gender identity under federal law, finding they are both protected under Title VII of the Civil Rights Act. Several federal court decisions have found the same, including for example, a recent decision by the federal district court in Arizona, which found with almost no analysis or fanfare, that a transgender prison guard is clearly entitled to protection under Title VII. Doe v. Arizona, No. CV-15-02399-PHX-DGC, 2016 WL 1089743 (D. Ariz. Mar. 21, 2016).  This decision illustrates just how far Title VII jurisprudence has evolved over the past decade.  Many district courts regularly hold that transgender and/or sexual orientation status is protected under federal anti-discrimination laws.

Previously such theories were not readily accepted, and even today remain debatable. Courts have had trouble in the past resolving the dissonance of Congress’ intent, which specifically excluded from the Civil Rights Act sexual orientation and gender identity as protected characteristics.  Indeed, Congress has repeatedly refused to expand Title VII to list sexual orientation and gender identity as protected categories through the Employment Non-Discrimination Act (ENDA).

However, the United States Supreme Court originally opened the door for these gender identity and sexual orientation status protections in Price Waterhouse v. Hopkins, 490 U.S. 228 (1989) and Oncale v. Sundowner Services, 523 U.S. 75 (1998).  To recap, very briefly, Hopkins involved a woman who was “too aggressive” and “not feminine enough,” and was ultimately passed over for partnership. The Court found that discrimination for failing to live up to gender stereotypes was actionable. Oncale similarly found same-sex harassment, in this case men harassing other men on an oil rig, was actionable because the harassment was based on expected gender norms.  Since then, the EEOC and some intermediate federal appellate courts have applied this reasoning and found that Title VII can protect transgender status and/or sexual orientation based on these gender norm theories. Macy v. Holder, App. No. 0120120821, 2012 WL 1435995 (EEOC Apr. 20, 2012); see also Glenn v. Brumby, 663. F.3d 1312 (11th Cir. 2011); Smith v. City of Salem, 378 F.3d 566 (6th Cir. 2004).

As a result, for prudent employers, the question may be moot even in states that may curtail transgender and/or sexual orientation protections.  A body of federal cases protecting against gender identity and/or sexual orientation status discrimination exists and continues to develop.  In addition, many state and local jurisdictions affirmatively provide such protections (e.g., California and New York).  Until further guidance is provided by the Supreme Court or Congress, it would be best to assume discrimination based on these protected characteristics remains prohibited nationwide.

TransMayor Bill de Blasio and the New York City Council have made no secret of their desire to expand the reach and protections offered by the New York City Human Rights Law (“NYCHRL”).  This year saw the expansion of these protections, such as bans on using, or even inquiring about, individuals’ credit and criminal background information in many employment decisions. Given this flurry of recent added protections, one would expect there would be no new regulatory hurdles for employers ushered in as the year winds down.  However, the New York City Commission on Human Rights (“the Commission”) decided to provide one last surprise, issuing new enforcement guidelines under the NYCHRL as we say goodbye to 2015.  Entitled Legal Enforcement Guidance on Discrimination on the Basis of Gender Identity or Expression, these new guidelines set forth various forms of conduct by employers (as well as landlords and businesses in general) that the Commission finds to be discriminatory based upon gender, gender identity, and/or transgender status.

As most employers in New York City are aware, existing law prohibits employers from terminating, refusing to hire or promote, or setting different terms of employment because of an individual’s actual or perceived status as a transgender person. This new guidance, however, targets less obvious forms of harassment and discrimination based on gender, gender identity, and/or transgender status, which now also run afoul of the law, including: (i) refusing to use a transgender employee’s favored name, pronoun and/or prefix; (ii) prohibiting a transgender employee from using a single-sex bathroom or locker room, even if inconsistent with their biological sex; (iii) imposing uniform or grooming standards based on an employee’s biological sex or gender; and/or (iv) considering an employee’s actual or perceived transgender status in employee benefits or when evaluating a request for accommodation.  For example, health benefits and leave must be extended on a non-discriminatory basis for transition-related care and/or gender-affirming care.  For many employers, particularly in the restaurant and hospitality industries, the new limitations on uniform and grooming standards will come as a shock.  Frequently uniform and grooming codes in the restaurant and hospitality industries will specify “neckties required for men” or “earrings allowed for women only,” which now appear to be verboten.

It is critically important for employers to review their employment policies immediately (or at least once the champagne has worn off tomorrow) to ensure compliance with the Commission’s new guidance.  You definitely don’t want to risk the draconian penalties, i.e. up to $250,000 where such conduct is found willful, wanton and/or malicious.  If you have any questions regarding the Commission’s new guidance, please reach out to an attorney in Fox Rothschild’s labor and employment department to assist you.  With that, and most importantly, a happy and healthy New Year to you and your loved ones.

Although Title VII does not prohibit employment discrimination on the basis of sexual identity or orientation, nonetheless same sex discrimination and/or sexual harassment is.  (While Title VII affords no protection against discrimination based upon sexual orientation, an increasing number of states and municipalities have passed such laws, such as NYS and NYC).   See our post of June 27, 2013.

13187338_sThis is illustrated in the EEOC’s press announcement of a $155,000 settlement (which we hope is accurate and not premature, as another such announcement which we relied upon the other day and posted was) with a North Carolina private security and public safety company.

A class of male employees was allegedly subjected to sexual harassment by the company’s male captain and a male lieutenant:   “the captain making offensive sexual comments to his male subordinate employees; soliciting nude pictures from them; asking a male employee to undress in front of him; and soliciting male employees for sex. The captain and lieutenant also allegedly forced male employees to accompany them to a gay strip club while on duty. The complaint further alleged that the captain touched the chests and genitals of some of the male employees and offered promotions to certain male employees in exchange for sex.”

This case is similar to one we wrote about on April 2nd, where a New Mexico car dealership agreed to pay over $2 million, along with “a very strong consent decree,” to settle an EEOC same sex sexual harassment (and retaliation) lawsuit  on behalf of over 50 men.  The complaint there alleged that for ten years company managers “subject[ed] a class of men to egregious forms of sexual harassment, including shocking sexual comments, frequent solicitations for oral sex, and regular touching, grabbing, and biting of male workers on their buttocks and genitals.”

The EEOC’s General Counsel Lopez said then that “This settlement serves to remedy the egregious sexual harassment that the EEOC alleged the men were subjected to … It also raises awareness that all employees, male and female, are entitled to work in an environment free of sexual harassment and retaliation.”

 

On May 27, 2011, the federal Office of Personnel Management issued guidelines to federal agencies regarding transgendered employees, i.e., those who are in transition from one gender to another. They must “all be treated with dignity and respect” consistent with the government’s policy of providing a discrimination-free workplace. 

 

The "guidance" defines and describes "gender identityas "the individual’s internal sense of being male or female.  Gender identity is generally determined in the early years of an individual’s life and, if different from the individual’s physical gender, may result in increasing psychological and emotional discomfort and pain.  The way an individual expresses his or her gender identity is frequently called ‘gender expression,’ and may or may not conform to social stereotypes associated with a particular gender."

 

The "guidance" defines and describes "transgender" as "people with a gender identity that is different from the sex assigned to them at birth.  Someone who was assigned the male sex at birth but who identifies as female is a transgender woman.  Likewise, a person assigned the female sex at birth but who identifies as male is a transgender man.  Some individuals who would fit this definition of transgender do not identify themselves as such, and identify simply as men and women, consistent with their gender identity.  The guidance discussed in this memorandum applies whether or not a particular individual self-identifies as transgender."

 

Federal agencies are required to ensure that their policies and practices forbid discrimination on the basis of gender identity or perceived gender non-conformity, and that dress codes and bathroom access are consistent with the employee’s new gender. The agencies are permitted to allow a “reasonable temporary compromise” where an employee is in transition from one gender to another.