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November 01, 2018 Winter 2018

Discrimination in Employment Issues for LGBT Individuals

Employment discrimination is a very real concern to persons in the LGBT community. Nearly 6.5 million employees in the United States identify as LGBT. Nationwide surveys reflect widespread discrimination against LGBT employees.

Congress has failed to pass legislation expressly protec-ting LGBT employees from discrimination, even though polls reflect that American people overwhelmingly support protecting gay and trans people from workplace discrimination. Only 20 states, the District of Columbia and Puerto Rico, have laws  expressly prohibiting discrimination in employment because of sexual orientation and gender identity. Less than one-half of LGBT workers live in the 22 states that explicitly prohibit employment discrimination because of sexual orientation, and only about 40 percent live in states that expressly ban employment discrimination based on gender identity. There are many companies in the U.S. that embrace inclusion and are interested in attracting, retaining, and advancing LGBT employees, regardless of state and local law. The Human Rights Campaign reports that as of 2016, 92 percent of Fortune 500 companies have non-discrimination policies that include sexual orientation, and 82 percent have non-discrimination policies that include gender identity.

Although Title VII of the Civil Rights Act of 1964 (“Title VII”) does not expressly ban employment discrimination against LGBT employees or applicants, recent federal court decisions have acknowledged Title VII’s protection of transgender individuals. This year, the Seventh Circuit Court of Appeals became the first federal appellate court to rule that Title VII prohibits discrimination based on sexual orientation. Another first this year was a ruling by a federal judge in the Eastern District of Pennsylvania that transgender individuals diagnosed with gender dysphoria may be covered under the Americans with Disabilities Act (“ADA”). These breakthroughs were a long time coming, and LGBT advocates are hopeful that other courts will adopt the reasoning of these decisions favorable to LGBT employees.

Title VII provides, in pertinent part, that “[i]t shall be an unlawful employment practice for an employer … to discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual’s … sex.” For the past 50-plus years, the Supreme Court has expanded the interpretation of “because of sex.” In Price Waterhouse v. Hopkins, the Court used the terms “sex” and “gender” interchangeably and noted that “Congress’ intent to forbid employers to take gender into account in making employment decisions appears on the face of the statute.” The Court expressly found that “[i]n forbidding employers to discriminate against individuals because of their sex, Congress intended to strike at the entire spectrum of disparate treatment of men and women resulting from sex stereotypes.” Nine years later, in Oncale v. Sundowner Offshore Servs., the Court ruled that same sex harassment claims are covered by Title VII and noted that, while same sex harassment was “assuredly not” the primary concern of Congress when it enacted Title VII, “statutory prohibitions often go beyond the principal evil to cover reasonably comparable evils, and it is ultimately the provisions of our laws rather than the principal concerns of our legislators by which we are governed.”

In 2004, the Sixth Circuit Court of Appeals was the first federal court to expand the Price Waterhouse sex stereotyping theory to a transgender employee. Three years later, the U.S. Equal Employment Opportunity Commission (“EEOC”) issued an Informal Discussion Letter which included a comment that, “[h]istorically, courts and the EEOC have held that Title VII does not prohibit discrimination against an individual because of transgender status … [i]n the past few years, however, some courts have determined that discrimination against a transgender individual may constitute unlawful gender stereotyping in violation of Title VII’s prohibition against sex discrimination.”

The EEOC issued a landmark ruling in 2012 in Mia Macy v. Eric Holder, Attorney General, Department of Justice (Bureau of Alcohol, Tobacco, Firearms and Explosives) (“Macy”). Macy was “one of thousands of decisions issued by the [EEOC] regarding the rights of federal employees in 2012.” For the first time, the EEOC held that claims of transgender discrimination are cognizable under Title VII. The EEOC determined that when an employer discriminates against an employee because the person is transgender, the employer has engaged in disparate treatment “related to the sex of the victim.” And, this is true whether or not “an employer discriminates against an employee because the individual has expressed his or her gender in a non-stereotypical fashion, because the employer is uncomfortable with the fact that the person has transitioned or is in the process of transitioning from one gender to another, or because the employer simply does not like the person identifying as a trans- gender person. In each of these circumstances, the employer is making a gender-based evaluation and violating the Supreme Court’s admonition that ‘an employer may not take gender into account in making an employment decision.’ Price Waterhouse, 490 U.S. at 244.”

The EEOC’s 2013-2016 Strate- gic Enforcement Plan (“SEP”) was approved by the Commission on December 17, 2012, and included among its priorities the following emerging or developing issues: “coverage of lesbian, gay, bisexual and transgender individuals under Title VII’s sex discrimination provi- sions, as they may apply.” In 2014, for the first time in its history, the EEOC filed lawsuits challenging discrimination against transgender employees as violating Title VII. Equal Employment Opportunity Commission v. R.G. & G.R Harris Funeral Homes, Inc. is currently pending before the Sixth Circuit.

The EEOC is appealing the trial court’s decision that the defendant is entitled to an exemption under the Religious Freedom Restoration Act (“RFRA”) “from Title VII and the body of sex-stereotyping case law that has developed under it, under the facts and circumstances of this unique case.” A consent judgment was entered in the second case, U.S. Equal Employment Opportunity Commission v. Lakeland Eye Clinic, about six months after it was filed.

The EEOC and private plaintiffs in transgender discrimination lawsuits are working toward pushing past the sex stereotyping theory to achieve judicial decisions that transgender discrimination is sex discrimination. One recent decision of note is Fabian v. Hospital of Central Connecticut, where the court, in denying the employer’s motion for summary judgment, held that “[e]mployment discrimination on the basis of transgender identity is employment discrimina tion ‘because of sex’ and constitutes a violation of Title VII of the Civil Rights Act.”

In July 2015, in ruling on a federal sector matter, the EEOC determined for the first time that “sexual orientation is inherently a ‘sexbased consideration,’ and an allegation of discrimination based on sexual orientation is necessarily an allegation of sex discrimination under Title VII.” Subsequently, on March 1, 2016, the EEOC filed its first lawsuits challenging sexual orientation discrimination as sex discrimination under Title VII. U.S. Equal Employment Opportunity Commission v. Pallet Companies, involved a lesbian woman who was harassed and then terminated in retaliation for objecting to the harassment. A consent decree was entered on June 28, 2016. The other case, U.S. Equal Employment Opportunity Commission v. Scott Medical Health Center, involves a gay man who was harassed at work and who claims that he was constructively discharged. Trial in this matter is scheduled for December 11, 2017.

As noted by the Seventh Circuit in Hively v. Ivy Tech Community College of Indiana, “[f]or many years, the courts of appeals of this country understood [Title VII’s] prohibition against sex discrimination to exclude discrimination on the basis of a person’s sexual orientation. The Supreme Court, however, has never spoken to that question” In Hively, the Seventh Circuit ruled that sexual orientation discrimination is sex discrimination under Ti- tle VII. Ivy Tech did not appeal. Two other circuit courts have recently ruled that sexual orientation discrimination claims are not covered by Title VII. The Second Circuit has recently voted in favor of rehearing the appeal in Zarda v. Altitude Express. The Eleventh Circuit has recently denied en banc review in Evans v. Georgia Reg’l Hosp., and and it is expected that the employee’s attorneys at Lambda Legal will appeal to the Supreme Court.

To briefly address discrimination in employment benefits, Section 1557 of the Affordable Care Act (“ACA”) prohibits healthcare providers and health insurance issuers from discriminating on the basis of sexual orientation and gender identity, among other protections. The U.S. Department of Health and Human Services is currently enjoined from enforcing Section 1557’s regulations prohibiting discrimination on the basis of gender identity. Regardless of what happens to the ACA, the EEOC has taken the position that employers who fail to provide healthcare coverage for their transgender employees engage in sex discrimination in violation of Title VII. In the agency’s amicus brief filed in Josef Robinson v. Dignity Health d/b/a/ Chandler Reg’l Medical Center, the EEOC noted that Title VII makes it unlawful for an employer to “’discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual’s … sex.’ 42 U.S.C. § 2000e-2(a)(i). ‘Health insurance and other fringe benefits are ‘compensation, terms, condi- tions, or privileges of employment.’ Newport News Shipbldg. & Drydock v. EEOC, 462 U.S. 669, 682.” 

Providing transgender employees the rights and protections afforded under the ADA is important, even though the disability label is currently controversial for some. There are a number of reasons why transgender individuals need or could benefit from accommodations during transitioning. The Family and Medical Leave Act allows for some leave taking but only covers employers of 50 or more employees. The ADA only requires 15 employees and there is no requirement that the employee be with a company a full year before being covered. The ADA requires employers to provide reasonable accommodations to a broad range of covered employees. Reasonable accommodations that would be beneficial to many transgender employees include the ability to work from home a few days each month in preparation for electrolysis and laser removal of facial hair, which requires at least a couple days of beard growth before treatment. ADA coverage should permit time off or working remotely so that transgender women do not have to appear at work with noticeable beards. Additionally, transgender employees should be afforded reasonable amounts of time off as ADA accommodations to attend counseling, endocrinologist appointments, and after surgery recovery, if that is in their plan.

The Equality Act was reintroduced in both the U.S. House of Representatives (H.R. 2282) and the Senate (S. 1006) on May 2, 2017. The Act would, among other things, amend Title VII to expressly prohibit discrimination because of sexual orientation and gender identity. Although there have been important victories in the fight for equal employment opportunity for LGBT individuals, there is much more work to be done to ensure that all gay, lesbian, bisexual, transgender, and genderqueer people are legally protected from employment discrimination.

This article was originally printed in the Young Lawyers Division
Publication, TYL.  Link to original article.
TYL is available quarterly in print to members of the
ABA Young Lawyers Division (YLD).

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