U.S. Supreme Court: Title VII Prohibits Discrimination Based on Sexual Orientation and Transgender Status

Last week, the United States Supreme Court held that individuals whose employment was terminated because of their sexual orientation or transgender status have standing to sue under Title VII of the Civil Rights Act of 1964. Although nearly half of the states had already expressly prohibited discrimination based on sexual orientation or transgender status in their state anti-discrimination laws, the Supreme Court’s decision in Bostock v. Clayton County, Georgia now recognizes such protections universally throughout the country under existing federal law.

Title VII bars discrimination against workers because of race, color, religion, national origin, and sex. For decades, courts throughout the country held that “because of … sex” did not include sexual orientation or gender identity. Recently, however, two federal appellate courts en banc held that claims of discrimination based on sexual orientation were actionable under Title VII, and another appellate court held that transgender status was prohibited as a form of sex discrimination. This term, the Supreme Court considered and combined three cases—Bostock, Altitude Express Inc. v. Zarda, and R.G. & G.R. Harris Funeral Homes, Inc. v. Equal Employment Opportunity Commission—to decide whether “because of … sex” also included sexual orientation and transgender status.

In a 6-3 decision, the Supreme Court ruled that discrimination on account of sexual orientation and transgender status is discrimination “because of … sex.” The Court focused its analysis on the terms of the statute, reasoning that employers violate Title VII when they intentionally rely in part on an individual’s sex when taking an adverse employment action against an employee. Because one cannot consider an individual’s sexual orientation or transgender status without taking into account that individual’s own sex, the Court concluded, “sex plays a necessary and undisguisable role in the decision” to fire a gay, lesbian, or transgender employee, which is “exactly what Title VII forbids.” According to the Court, the fact that an individual employee’s sex is not the sole cause of the adverse employment action against a gay, lesbian, or transgender employee is irrelevant, stating in its ruling that, “If an employer would not have discharged an employee but for that individual’s sex, the statute’s causation standard is met, and liability may attach.”

The Supreme Court rejected the argument that discrimination based on sexual orientation or transgender status is not sex discrimination because there is no harm intended for one particular sex or the other as a class. In other words, the argument went, if an employer discriminated against gay and lesbian employees equally, there could be no intentional discrimination based on sex. But, the Court explained, Title VII focuses on individuals, not groups, noting, “Title VII’s plain terms and our precedents don’t care if an employer treats men and women comparably as other groups; an employer who fires both lesbians and gay men equally doesn’t diminish but doubles its liability.”

The Supreme Court’s decision leaves unanswered a number of important questions for employers. For instance, employers must consider how to address questions regarding workplace bathrooms, locker rooms, and dress codes in light of this new interpretation of long-existing federal law. Further, the Court expressly limited its holding to Title VII, leaving unaddressed whether its reasoning applies to other federal statutes like the Equal Pay Act or the Affordable Care Act. The Court also specifically left open questions regarding religious exceptions or objections, such as whether the First Amendment bars application of this opinion to the “employment relationship between a religious institution and its ministers,” or whether an employer’s religious convictions “might supersede Title VII’s commands in appropriate cases” under the Religious Freedom Restoration Act.

In light of this opinion, employers will want to review their policies on discrimination, harassment, and retaliation to ensure compliance with federal law. Our Labor and Employment Practice Group has significant experience assisting employers facing these issues. If you have questions about this case or need assistance in this area, contact an attorney above.