Employment Law Daily Justices will rule on Title VII reach to sexual orientation and gender identity
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Monday, April 22, 2019

Justices will rule on Title VII reach to sexual orientation and gender identity

By Pamela Wolf, J.D.

Certiorari was granted in three separate petitions involving a transgender funeral home employee, a gay skydiving instructor, and a gay child welfare services coordinator, all allegedly fired in violation of Title VII.

On April 22, the Supreme Court agreed to take on three cases that put the outer reaches of Title VII to the test when it comes to protections available to LGBTQ applicants and employees. Together, Bostock v. Clayton County, Georgia (17-1618), Altitude Express, Inc. v. Zarda (17-1623), and R.G. & G.R Harris Funeral Homes v. EEOC (18-107) ask the court to determine whether Title VII protects against employment discrimination based on sexual orientation and gender identity.

The Court’s order consolidates Bostock and Altitude Express for one hour of oral argument on the question of whether Title VII’s prohibition against discrimination “because of . . . sex” encompasses discrimination based on sexual orientation.

R.G. & G.R. Harris Funeral Homes will be argued separately on the question whether Title VII prohibits discrimination against transgender people based on their status as transgender, or sex stereotyping under the Court’s 1989 decision in Price Waterhouse v. Hopkins.

Sharp divides. The questions presented in the three petitions for certiorari are so controversial that it’s not just the courts that are split on the answers. Under the Trump Administration, the EEOC and the Department of Justice stand in opposition to one another on these important questions. The EEOC has long maintained that discrimination “against an individual because of gender identity, including transgender status, or because of sexual orientation is discrimination because of sex in violation of Title VII” in both sub-regulatory guidance and administrative and court adjudications.

Notably, the EEOC is an independent federal agency; it publicly has not changed its position.

Policy flip-flops. The Trump Administration, however, has withdrawn Obama-era guidance that gave Title VII broad reach. On October 4, 2017, Attorney General Jeff Sessions issued a memorandum to U.S. Attorneys, stating, “Title VII’s prohibition on sex discrimination encompasses discrimination between men and women but does not encompass discrimination based on gender identity per se, including transgender status.”

The Sessions memo was a reversal of earlier policy: he withdrew the December 15, 2014, memorandum issued by Attorney General Eric Holder under the Obama Administration. Holder’s policy at the time also had reversed then-current DOJ policy; it stated that the DOJ “will no longer assert that Title VII’s prohibition against discrimination based on sex does not encompass gender identity per se (including transgender discrimination).

In a July 26, 2017, Second Circuit amicus brief filed in the en banc hearing of the Altitude Express case, the DOJ asserted that Title VII does not include protection against discrimination based on sexual orientation. This of course is directly contrary to the EEOC’s position.

Transgender presentation. Below in R.G. & G.R. Harris Funeral Homes, the employee, who intervened in the case after the EEOC filed suit on her behalf, is a transgender woman who was “assigned male at birth.” She was hired in 2007 and presented as a man until July 2013, when she informed her employer that she “decided to become the person that [her] mind already is.” She explained that she intended to have sex reassignment surgery and, as the first step, would live and work full-time as a woman for one year.

The funeral home fired her about two weeks later because she would no longer dress like a man under the funeral home’s dress code, which required all public-facing male employees to wear suits and ties, and its public-facing female employees to wear skirts and jackets. The funeral home provided all male employees who interacted with clients with free suits and ties, but until October 2014—after the EEOC filed this suit—did not provide its female employees with any sort of clothing or clothing allowance.

In a memorable victory for the EEOC, the Sixth Circuit ruled in March 2018 that discrimination against employees, either because of their failure to conform to sex stereotypes or because of their transgender and transitioning status, is illegal sex discrimination under Title VII.

Sexual orientation. In Altitude Express, an en banc divided Second Circuit opinion upended its own precedent to hold that Title VII prohibits sexual orientation discrimination—in this case, against a skydiving instructor who was allegedly fired because he was gay. The termination followed a complaint by a customer’s boyfriend that the instructor had touched the woman inappropriately and told her he was gay to excuse it.

After the employee sued over his termination, the district court found he had enough evidence to support his state-law claim for sexual orientation discrimination, but he failed to show he was discriminated against based on his sex for purposes of his Title VII claim, which failed on summary judgment. A Second Circuit panel affirmed, refusing to revisit Second Circuit precedent upon which the lower court’s ruling relied, explaining that it could only be overturned by the appeals court sitting en banc.

Precedent flipped. Doing exactly that, the full Second Circuit (13 judges) reversed its precedent and held that “sexual orientation discrimination is motivated, at least in part, by sex and is thus a subset of sex discrimination.” Among other things, the appeals court found that the most natural reading of Title VII’s prohibition on discrimination “because of … sex” is that it extends to sexual orientation—because sex is necessarily a factor in sexual orientation. For example, amici argued the employee was fired because he is “gay” and not because he is “a man,” but the “word choice” does not change the fact that a gay employee is a man attracted to men, and the termination was based in part on the employee’s sex. Intent matters, not semantics.

The court also found support for its conclusion through the lens of gender stereotyping “because sexual orientation discrimination is almost invariably rooted in stereotypes about men and women.”

Old precedent stands. But in Bostock, the appeals court decided not to disturb precedent. Eleventh Circuit Judge Rosenbaum, joined by Circuit Judge Pryor, dissented from the decision to deny rehearing en banc of a panel decision affirming dismissal. Emphasizing the number of people affected by the issue and the importance of giving it full review, Rosenbaum expressed disappointment that the Eleventh Circuit instead chose to rely on “39-year-old precedent” that she asserted was the equivalent of “an Edsel with a missing engine” and had been abrogated by the Supreme Court in Price Waterhouse.

The employee, who is gay, worked for the county as a child welfare services coordinator in the Juvenile Court. For more than 10 years he received good performance reviews and accolades, but this changed after he became involved with a gay recreational softball league in January 2013. He alleged that his participation in the league and sexual orientation were openly criticized, he was subjected to an internal audit, and he was ultimately terminated because of his sexual orientation and identity. The employee’s subsequent Title VII suit was dismissed, and he appealed.

With little review of the background facts other than to say that the employee alleged that the county discriminated against him based on his sexual orientation, a panel of the Eleventh Circuit, in a three-page decision, affirmed dismissal of his Title VII claims. The panel explained that it was foreclosed by the Circuit’s divided 2017 ruling in Evans v. Georgia Regional Hospital that Title VII’s prohibition against discrimination “because of sex” does not encompass discrimination based on sexual orientation. The panel explained that “under our prior panel precedent rule, we cannot overrule a prior panel’s holding, regardless of whether we think it was wrong, unless an intervening Supreme Court or Eleventh Circuit en banc decision is issued.”

Everyone will be eagerly anticipating the Supreme Court’s decision on the question.

What’s at stake? There is much at stake in the three cases, particularly for the growing number of LGBTQ individuals in the United States who have either self-identified or been “outed” at work. And employers will certainly welcome any clarity and certainty that the High Court provides in its much-anticipated opinions.

There is the obvious question of what exactly Title VII’s prohibition against discrimination in employment on the basis of sex means. Here, the Court will consider whether Congress was required to spell out in the statute that its protections include both discrimination based on sexual orientation and gender identity in order for those prohibitions to be real and effective.

The Justices also may contemplate whether the EEOC, as the agency charged with implementing regulations and enforcing the statute, in light of existing ambiguity, properly made the determination that these protections are included.

But even more may be at stake. At least some stakeholders have suggested that the arguably more conservative current Court could take this as an opportunity to revisit Price Waterhouse v. Hopkins, and perhaps undermine or obliterate its sex-stereotyping theory of discrimination, causing a major sea change.

A long time coming. As Dorsey & Whitney partner JoLynn Markison, sees it, “This shift in the Supreme Court’s willingness to rule on the issue of whether Title VII’s prohibition on sex discrimination extends to gender identity and sexual orientation—which are quintessential expressions of ‘sex’—has been a long time coming.”

She pointed to the Court’s denial of certiorari in Jameka Evans v. Georgia Regional Hospital less than a year-and-a-half ago. “At that time, Justice Anthony Kennedy, a crucial swing vote and author of the famous Obergefell opinion extending marriage rights to same-sex couples, remained on the bench,” Markison noted. “His replacement, Justice Brett Kavanaugh, does not have a clear judicial record on LGBTQ issues, but has previously been heavily promoted by the Family Research Council—a known anti-LGBTQ organization that has described LGBTQ people as ‘harmful’ and ‘unnatural,’”

Is there a swing vote? As to whether there is a currently a potential swing vote on this issue, or the outcome is already as good as decided, Markison said, “The balance could lie with Chief Justice John Roberts, who notably did not join the conservative dissenters in Pavan v. Smith, in which the Supreme Court held that married same-sex couples are entitled to be listed on their children’s birth certificates the same as married heterosexual couples.”

Employer tip. Markison also offered an important tip for employers. “Regardless of how the Supreme Court ultimately rules, for employers the best course remains to ensure equal treatment of LGBTQ employees,” she said. “Many states already have laws that prohibit discrimination on the basis of sexual orientation. Even if the Supreme Court declines to recognize LGBTQ discrimination as a form of sex discrimination under Title VII, employers must still comply with state laws relating to employment discrimination.”

“More importantly, Markison continued, “treating people fairly and equally—regardless of sexual orientation or gender identity—is just the right thing to do.”

The cases are Nos. 17-1618, 17-1623, and 18-107.

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