The workplace is a daily convergence of individuals with different races, ethnicities, genders, values, beliefs, etc. It is only expected then that issues would arise and require certain actions on the employer’s behalf including warnings, demotions, and terminations. Even so, when employment actions are carried out, they must be permitted by law. One such law that employers must follow is Title VII of the Civil Rights Act of 1964.

Title VII prohibits employers from failing or refusing to hire or terminating an individual, “or otherwise [discriminating] against any individual…because of [said] individual’s race, color, religion, sex, or national origin.” 42 U.S.C. § 2000e–2(a)(1). While the language of this statute is relatively straightforward many questions have arisen over who or what classes fall under its scope.

In mid-June, the Supreme Court handed down Bostock v. Clayton County, Georgia (U.S., June 15, 2020, No. 17-1618) answering the question of whether Title VII protects transgender and gay or lesbian employees from discrimination in the workplace on the “basis of sex.” Three separate cases in various jurisdictions alleged that employees had been terminated based on their sexual orientation or gender identity:

Bostock v. Clayton County, Georgia: Gerald Bostock alleged he was fired from his job after the County learned of his participation in a gay softball league.
Altitude Express, Inc. v. Zarda: Donald Zarda alleged he was fired after the employer learned that he was gay through a complaint from a customer who Zarda had informed.
R.G. & G.R. Harris Funeral Homes, Inc. v. EEOC: Aimee Stephens alleged she was fired after she informed her employer about her plans to transition from male to female.

Breaking Down the Court’s Opinion

The employees’ assertion of workplace discrimination based on Title VII was countered by the employers, who claimed, that these employees were not covered under the statute because the statute’s use of the term “sex” only covered discrimination based on the employee’s status as a female or male.

However, the Supreme Court disagreed and held that Title VII of the Civil Rights Act prohibits employers from firing an individual merely because they are gay or transgender. The Court’s analysis concentrated on the public meaning of the statute at the time it was enacted. Although the majority opinion acknowledged that sexual orientation and gender identity were “distinct concepts from sex,” it ultimately found that it is impossible to discriminate against an employee for being transgender or homosexual without also discriminating against the individual based on sex.

Specifically, the Court concluded that an employer that takes an adverse employment action against an individual while relying, in whole or in part, on that individual’s sex violates Title VII. Consequently, the Court found that an employer cannot consider an individual’s transgender status or sexual orientation without taking into account that individual’s own sex. Therefore, according to the Court “sex plays a necessary and undisguisable role in the decision” to fire a transgender or homosexual employee which is forbidden by Title VII.

To determine whether a statutory violation has occurred the question becomes: would a different decision have been made by the employer if the employee’s sex was changed? For example, if an employer fires a man because he is sexually attracted to men, Title VII has been violated because if the employee’s sex was changed to a woman, who is sexually attracted to men, the outcome would be different because he would not have been fired.

While this ruling does change how discrimination on the “basis of sex” is interpreted for Title VII purposes, employers should keep in mind the legal obligations imposed on them by the states in which they have employees.

Looking Back

The Bostock decision is not the first time that workplace discrimination protections have been contemplated for transgender or homosexual employees. Since 1994, Congress has attempted to pass the Employment Non-Discrimination Act which would have, if passed, prohibited discrimination in hiring and employment on the basis of sexual orientation or gender identity.

At the state level, around 22 states currently provide protections for transgender or gay employees. Some states prohibit discrimination based on sexual orientation and gender identity of public employees. California was among one of the first states to prohibit employment discrimination based on sexual orientation and gender identity. Through various bills including the Gender Nondiscrimination Act, California amended the Fair Employment and Housing Act (FEHA) to explicitly prohibit harassment and/or discrimination based on sex to include “sexual orientation” and “gender identity.”

As the law stands today, FEHA prohibits any employer for discriminating on the basis of “sex, gender, gender identity, gender expression, age, [or] sexual orientation.” Cal. Govt. Code § 12940. This means that an employer cannot refuse to hire, refuse to promote, or terminate based on an individual’s gender identity or sexual orientation. The Supreme Court’s decision should serve as a reminder for California employers to be cognizant of what a court looks for when determining whether discrimination has occurred or not.

While there are employers who need to change their policies because of the Court’s decision, most California employers are already compliant and will not need to make huge changes to their policy. However, in light of the ruling, employers should review their policies to ensure compliance with all legal obligations.

Moving Forward

Although the implications of the Bostock decision are unlikely to significantly change the current practices and policies of California employers, there is no doubt that employers should prepare for additional litigation to clarify when discrimination “because of sex” is prohibited by other federal statutes. The danger of not maintaining harassment and discrimination free workplaces is a costly and lengthy lawsuit.

Moving forward, employers should keep the following in mind regarding their employment practices:

First, review your policies, handbooks, and benefit plans and revise as necessary to ensure compliance with the law and limit liability for claims of employment discrimination.

Second, have employees remain up-to-date on required training, such as, revising sexual harassment prevention training to cover harassment based on sexual orientation or gender identity.

Third, supervisory employees, including managers or Human Resources personnel, should be informed of this development to understand how employment actions, particularly adverse ones, must be made.

Compliance with and enforcement of the legal obligations imposed by statutes is an employer’s first defense against claims for workplace discrimination.