Supreme Court Arguments on Discrimination Based on Sexual Orientation and Identity

Three Cases Consolidated for Oral Argument

In Zarda v. Altitude Express, the plaintiff alleged that his employer violated Title VII for terminating his employment due to his being gay. Reviewing the matter en banc, the Second Circuit ruled for the plaintiff and held that Title VII’s prohibition against discrimination on the basis of sex necessarily prohibited discrimination on the basis of sexual orientation. In so ruling, it overturned prior Circuit precedent. In reaching this holding, the Second Circuit joined the Seventh Circuit in finding sexual orientation discrimination to be prohibited by Title VII.

Three months later, the Eleventh Circuit in Bostock v. Clayton County in a similar case reaffirmed that circuit’s precedent holding sexual orientation is not protected by Title VII’s prohibition against discrimination on the basis of sex.

R.G. & G.R. Funeral Homes v EEOC involves a transgender woman terminated from her job after transitioning from male to female. Her employment ended after telling her long-time employer that she intended to transition to dressing as a woman and planned to have sex-affirmation surgery. The Sixth Circuit found that a termination based on an employee’s gender identity falls squarely within Title VII’s prohibition against discrimination on the basis of sex and sex-based stereotypes. Accordingly, the Sixth Circuit held that Title VII prohibits discrimination on the basis of gender identity.

Background

To better understand the issues before the Court, it is important to review two prior Supreme Court cases as to how these cases have been applied to questions of LGBT discrimination by lower courts and federal agencies.

First, in Price Waterhouse v. Hopkins, 490 U.S. 228 (1989), the Court found that a female employee, who was passed over for the position of partner because she did not fit the employer’s stereotype of how a woman should present in dress or demeanor, could state a claim of sex discrimination. Second, in Oncale v. Sundowner Offshore Services, 523 U.S. 75, 79 (1998), the Court unanimously held in an opinion authored by Justice Scalia that Title VII’s protections extended to a claim of same-sex harassment. Of note, in issuing this decision, Justice Scalia held that while same-sex harassment was:

assuredly not the principal evil Congress was concerned with when it enacted Title VII . . . statutory prohibitions often go beyond the principal evil [they were passed to combat] 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. Title VII prohibits “discriminat[ion] . . . because of . . . sex.” [This] . . . must extend to [sex-based] discrimination of any kind that meets the statutory requirements.

Subsequent to these rulings, an increasing number of lower courts have read these cases together to find that LGBT employees cannot be discriminated against on the basis of their expression of their sex under Title VII. With respect to transgender employees, courts reason that just as Ms. Hopkins defiance of gender norms was protected so too are transgender employees protected for not meeting gender expectations. Likewise, courts have found that discrimination against an employee who expresses him or herself as gay or lesbian is nothing more than discrimination based on sex stereotypes as to one’s attraction to persons of the opposite sex, and thus also is protected under Title VII’s prohibition. In coming to this reading of Title VII, at least one Court, the Seventh Circuit, has noted that such a reading of Title VII was necessary in order to give meaning to Oncale and Price Waterhouse. Otherwise, the Court reasoned there would be an untenable situation whereas an effeminate male employee could be protected under Title VII’s because of sex language but only if this individual is perceived as being straight. Kimberly Hively v. Ivy Tech Community College, 830 F.3d 698 (2016) (7th Cir. 2016), aff’d, 853 F.3d 339 (7th Cir. 2017) (en banc).

Some courts have adopted this reasoning but far from all. Lower courts continue to find that a plaintiff cannot state a claim of discrimination based on sexual orientation or gender identity. The rationale of those decisions is that gender identity and sexual orientation are separate classifications, not encompassed in the word sex. Courts reaching such rulings also note that a broadening of the scope of the word sex is an act that must be taken by Congress.

In fact, every Congress since 1992 has included a bill that would expressly extend employment protections to some or all members of the LGBT community. No such bill ever has passed both houses of Congress. In the wake of this legislative inaction, all agencies in the executive branch under the Obama administration took the position that the sex protections of Title VII extended to claims of sexual orientation and gender identity discrimination. The Trump administration takes the opposite position, and presently no executive branch agency, apart from the EEOC, continues to advocate for this broad reading of “on the basis of sex” in Title VII.

Oral Argument

The Supreme Court’s review of the scope of Title VII comes at a pivotal point in history. The legislative branch seems unable to pass LGBT legislation despite broad popular support, and the executive branch currently has an opposite view of the issue versus the prior administration. Given the stakes, it is not surprising that oral argument was heated and underscored the judicial divide on this issue.

In the sexual orientation cases, Justice Gorsuch seemed to accept that discrimination based on sexual orientation was a form of sex discrimination (a position that Justice Alito expressly disputed), but nevertheless he made clear that he was concerned with the Court overreaching by extending Title VII when Congress had refused to do so. Justice Roberts echoed these concerns, noting that when Congress expands a statute they are able to add in exceptions and limitations that the Court cannot do as readily. He expressed specific concern about the ability to protect religious employers. Justice Roberts also was concerned that expanding Title VII to cover sexual orientation discrimination would open the door to erasing all gender differences in the work place, including separate bathrooms. Note that this same argument was raised successfully over forty years ago by opponents of the proposed Equal Rights Amendment to the Constitution.

Counsel for the Plaintiffs, buoyed by the questions of the more historically liberal Justices, attempted to rebut these concerns. Counsel noted that Title VII does not preclude gender-specific rules and it only prohibits those rules that cause injury. Having separate bathrooms is unlikely to cause an adverse employment injury. Counsel further argued that extending Title VII to sexual orientation was not an expansion of Title VII but, instead, a right found in the plain text of the statute. Sexual orientation discrimination is sex discrimination, in their words, as it is treating a male employee worse for failing to conform to the expectation that he should love only women.

In the gender identity case, counsel for the plaintiff noted that just as the employer of the plaintiff in Price Waterhouse unlawfully discriminated against her for not walking and talking more femininely, so too was the plaintiff unlawfully terminated for failing to meet her employer’s stated stereotypes about men and women. Counsel also noted that in firing her for “identifying as a woman only because she was assigned a male sex at birth . . . it fired her for contravening a sex-specific expectation that applies only to people assigned male sex at birth; namely, that they live and identify as a man for their entire lives. That is disparate treatment on the basis of sex.” Finally, counsel argued that in firing her for “changing her sex” she was discriminated in the same way as someone terminated for changing their religion.

Justice Roberts and Justice Alito were skeptical that discrimination based on gender identity was a form of sex discrimination, repeatedly querying why this was not instead a separate category of discrimination based on transgender status. Justice Roberts again voiced concern that in issuing an expansive reading of Title VII the courts would violate the principle of judicial modesty.

Counsel for the plaintiff argued in response that it did not make sense to interpret Title VII to say that the plaintiff in Price Waterhouse “can’t be fired for being insufficiently feminine, but my client can be fired for being insufficiently masculine? There’s no textual basis for drawing that distinction whatsoever.”

This (Funeral Homes) lawsuit was brought by the EEOC, an agency that continues to argue that Title VII extends to gender identity discrimination, but at oral argument the Solicitor General argued on behalf of the Trump administration’s perspective that Title VII did not extend to gender identity. He argued that gender identity was a trait separate from sex. In assessing a claim of sex discrimination by a transgender male, the correct comparator is thus not a “cisgender” man (a non trans-man) but rather a trans woman. Thus, if you treat a transgender male exactly the same as a transgender female then you have not engaged in prohibited sex discrimination. He further argued that Title VII could not be read to include gender identity discrimination as the drafters of the statute had not considered it covered when Title VII passed.

Justice Ginsburg vociferously objected to this last point, noting that in 1964 the concept of sexual harassment was not recognized, but now everyone accepts that it is covered by the plain language of Title VII. Building on this, Justice Sotomayor argued that if a statute is potentially vague it is the role of the Court to interpret it in a way that protects individuals who are suffering from discrimination.

Uncertain Future

it is unclear how the court will rule in its first gay rights ruling in a generation without the voice of Justice Kennedy, Oral argument suggests that Justice Gorsuch is the somewhat unlikely swing vote. It is unknown how he will balance his judicial philosophy of textualism, a philosophy that supports the plaintiffs theory of the case, with his concerns of judicial overreach that support the position of the defendant-employers.

The Supreme Court’s decision may create a federal right of action for individuals who suffer discrimination on the basis of sexual orientation or gender identity, or the Court may rule that no such right exists under current law, or the Court may find that a right exists but must be balanced against an employer’s religious liberty interest.

A finding that results in an expansive reading of Title VII would end the current hodgepodge of state and municipal employment protections for the LGBT community and instead create a single Federal standard of protection. In contrast, a holding that excludes the LGBT community from the protections of Title VII will mean that whether an individual in this community has legal recourse in the event of an adverse employment action rests on state law. Further, as employee benefits law is in almost all circumstances governed solely by federal law, a ruling that reads Title VII narrowly may mean that participants in employer sponsored benefit plans who suffer benefit discrimination based on their LGBT status will no longer be able to argue that Title VII bars this conduct. Finally, to the extent the Court issues a split decision or creates a religious liberty balancing test, there will likely be a great deal of subsequent litigation to determine the exact confines of what is, and what is not, prohibited sex discrimination under Title VII.