United States Supreme Court Rules that Title VII Bars Workplace Discrimination Based Upon Sexuality and Gender Identity

In a highly anticipated decision, the United States Supreme Court ruled that Title VII applies to claims of discrimination based upon sexuality and gender identity. In addressing this question, the Supreme Court consolidated three separate cases and heard oral argument on October 8, 2019.

In Bostock v. Clayton County, Gerald Bostock, who had worked for Clayton County, Georgia filed suit after he was terminated from his job alleging that he was terminated after it was revealed that he was playing in a recreational gay softball league. The District Court granted the County’s motion to dismiss on the grounds that Title VII did not prohibit discrimination based on sexual orientation. The Eleventh Circuit affirmed the District Court’s ruling.

In the case of Zarda v. Altitude Express, Inc., Donald Zarda was a skydiving instructor for Altitude Express, Inc. and he alleged that he was terminated shortly after he advised a customer of his sexual orientation. At the District Court, the Court granted the employer’s motion for summary judgment on Mr. Zarda’s Title VII claim. However, on appeal, the Second Circuit reversed that ruling holding that “sexual orientation discrimination is properly understood as a subset of actions taken on the basis of sex” and allowed Mr. Zarda’s Title VII case to proceed.

Lastly, in the case of EEOC v. R.G. &. G.R. Harris Funeral Homes, Inc., Aimee Stephens who worked as a funeral director and embalmer for R.G & G.R. Harris Funeral Homes (“Harris Funeral Homes”) brought a claim with the EEOC alleging that Harris Funeral Homes violated Title VII when it terminated her shortly after she advised Harris Funeral Homes that upon her return to work from a vacation that she was going to live and work full-time as a woman. Ms. Stephens filed a charge of discrimination with the Equal Employment Opportunity Commission. The EEOC filed a complaint on her behalf in federal court, alleging Harris Funeral Homes violated Title VII by terminating her employment because she is transgender. The district court ultimately granted summary judgment in favor of Harris Funeral Homes based upon the Religious Freedom Restoration Act’s exemption from Title VII. The EEOC appealed the decision, and Ms. Stephens also intervened on appeal. The Sixth Circuit reversed, holding Harris Funeral Homes violated Title VII by firing Ms. Stephens because of her transgender status and sex stereotyping and in so ruling also rejected the Religious Freedom Restoration Act defense.

In their arguments before the Supreme Court, the employees relied on the text of Title VII arguing that discrimination based on sexuality and gender identity was discrimination “because of sex.” The employees also argued discrimination based on sexual orientation and gender identity constitutes impermissible sex stereotyping under Price Waterhouse v. Hopkins, 490 U.S. 228 (1989). Under this argument, the employees argued that their employers terminated them because they failed to conform to their employer’s sex-based stereotypes. On the other hand, the employers argued Title VII only prohibits an employer from treating one sex less favorably than the other, which is consistent with the original meaning of “sex” under Title VII. Moreover, the employers argued that Congress could have passed laws prohibiting discrimination on the basis of sexuality or gender identity if it meant to prohibit it.

In ruling that Title VII prohibits discrimination based on sexuality and gender identity, the Supreme Court concluded, “it is impossible to discriminate against a person for being homosexual or transgender without discriminating against that individual based on sex.” The Court reasoned that “[a]n employer who fires an individual for being homosexual or transgender fires that person for traits or actions it would not have questioned in members of a different sex.” Accordingly, the Court found, “[s]ex plays a necessary and undisguisable role in the decision, exactly what Title VII forbids.” Turning to the language of Title VII, the Court found that the statute prohibits employers from discriminating against the individual “because of sex,” which encompasses actions taken by employers against employees who display attributes that it would tolerate if they were exhibited by an individual of the other sex. Therefore, under Title VII, employers cannot discriminate on the basis of sexuality or gender identity.

Going forward, employers covered by Title VII should update their policies and handbooks to include sexuality and gender identity under their anti-discrimination and anti-harassment policies. While many states have previously prohibited such discrimination, now that the Supreme Court has ruled that discrimination based upon sexuality and gender is prohibited by Title VII, this is the law throughout the country. We also point out that in states such as Pennsylvania, which do not specifically prohibit discrimination on the basis of sexuality or gender identity, the ruling should also impact the interpretation of the states’ statutes that prohibit discrimination “on the basis” or “because of sex.” This is so since state courts have often followed the Federal Courts’ interpretation of “because of sex” under Title VII when addressing their own state statutes. Moreover, the Federal Courts themselves have utilized the Federal Court standards for Title VII when they are addressing state law claims. Therefore, there is a strong argument that even though a state statute does not explicitly prohibit discrimination based upon sexuality or gender identity, the Supreme Court’s interpretation of that phrase would apply to a state court interpreting similar language under a state statute.

One question left unanswered by the Court is how to reconcile this ruling addressing discrimination based upon sexuality and gender identity with the Religious Freedom Restoration Act of 1993 and other protections for religious beliefs. The majority opinion specifically indicates that the prohibition against discrimination based upon sexuality or gender identity could be displaced where the conduct in question was religiously motivated. Therefore, this issue will be subject of much more litigation going forward as the Courts have to balance the prohibitions against discrimination with the protections for religious beliefs.

If you have any questions about the impact of this decision on your business or how to update your policies, please contact Russ Massey at Wright & O’Donnell, P.C., directly at 610-940-4092.