US Supreme Court: Federal Law Prohibits Discrimination Against Gay, Lesbian, and Transgender Employees

The US Supreme Court on June 15 issued its long-anticipated ruling in Bostock v. Clayton County, which raised the question of whether Title VII’s anti-discrimination provisions protect applicants and employees who experience discrimination based on their sexual orientation or gender identity. In a 6-3 decision, the Court answered that question in the affirmative, holding that Title VII as currently enacted prohibits workplace discrimination against gay, lesbian, and transgender individuals. This LawFlash covers the landmark decision and key takeaways for employers.

The underlying controversy arrived at the Supreme Court in the form of a trio of cases from three different US courts of appeals:

1. The Eleventh Circuit in Bostock v. Clayton County had held that Title VII does not prohibit employers from firing employees for being gay.
2. The Second Circuit in Altitude Express v. Zarda had held the opposite, concluding that sexual-orientation discrimination did violate Title VII.
3. The Sixth Circuit in R.G. & G.R. Harris Funeral Homes v. EEOC had reached a similar holding as the Second Circuit, ruling that Title VII bars employers from firing employees based on transgender status.

The Supreme Court granted certiorari in all three cases last April and heard consolidated arguments at the beginning of its current term on October 8, 2019.

THE DECISION: ‘THE ANSWER IS CLEAR’

In a 6-3 decision authored by Justice Neil Gorsuch—joined by Chief Justice John Roberts and Justices Ruth Bader Ginsburg, Stephen Breyer, Sonia Sotomayor, and Elena Kagan—the Court held that Title VII’s ban on discrimination extends to gay, lesbian, and transgender individuals.

As Justice Gorsuch framed the issue, the Court was asked to decide “whether an employer can fire someone simply for being homosexual or transgender” and concluded that “the answer is clear.” According to the Court, “an employer who fires an individual merely for being gay or transgender defies the law” and runs afoul of Title VII’s broad prohibition rendering it illegal to rely on an individual’s sex in deciding to take adverse action against the employee.

The Court’s Reasoning

The Court’s analysis was straightforward. Focusing on the relevant text of the statute, it began by recognizing that Title VII renders it “unlawful … for an employer to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual … because of such individual’s … sex.” In the Court’s view, this language creates a “straightforward rule”: “An employer violates Title VII when it intentionally fires an individual employee based in part on sex.”

From there, the Court concluded that Title VII, by its terms, naturally prohibits discrimination against gay, lesbian, and transgender individuals because “it is impossible to discriminate against a person for being homosexual or transgender without discriminating against that individual based on sex.” Said another way, “for an employer to discriminate against employees for being homosexual or transgender, the employer must intentionally discriminate against individual men and women in part because of sex. That has always been prohibited by Title VII’s plain terms.”

Rejection of Opposing Arguments

In reaching its holding, the Court considered and rejected several arguments to the contrary:

• The Court dismissed any attempt to reframe the inquiry by focusing on different labels. Discrimination based on “homosexuality” or “transgender status” is discrimination based on sex in the same way as would be a policy based on “motherhood,” or a policy requiring women to pay more into a pension fund because of a “life expectancy” adjustment, both of which the Court previously struck down as prohibited by Title VII.
• Because an employee’s sex “need not be the sole or primary cause of the employer’s adverse action,” an employer cannot defend its decision by claiming that it was also motivated by the “sex the plaintiff is attracted to or presents as” (i.e., sexual orientation or gender identity) rather than simply the plaintiff’s sex.
• The Court also concluded that an employer cannot escape liability on the basis that it treats male and female employees comparably as groups. In other words, “an employer who intentionally fires an individual homosexual or transgender employee in part because of that individual’s sex violates the law even if the employer is willing to subject all male and female homosexual or transgender employees to the same rule.”

Finally, responding to some of these contrary arguments—and the Court’s dissenting members—the Court’s majority recognized that those who adopted Title VII in 1964 “might not have anticipated their work would lead to this particular result,” but “the limits of the drafters’ imagination supply no reason to ignore the law’s demands.” The letter of the statute governs, and “Title VII’s prohibition of sex discrimination … is written in starkly broad terms,” which virtually “guaranteed that unexpected applications would emerge over time.”

Indeed, in one of the opinion’s more colorful passages, the Court rejected the notion that it was pulling “elephants” out of “mouseholes.” The Court did not deny that its specific holding could be characterized as an “elephant” given its importance, but it rejected the idea that Title VII’s prohibition on sex discrimination was a “mousehole.” As the Court put it, then, “this elephant has never hidden in a mousehole; it has been standing before us all along.”

The Dissent

Three Justices dissented. Justice Samuel Alito, in an opinion joined by Justice Clarence Thomas, accused the majority of engaging in “legislation” rather than issuing a “judicial opinion interpreting a statute.” In Justice Alito’s view, Congress did not intend to outlaw discrimination because of sexual orientation or gender identity when it passed Title VII in 1964. He would have started from the proposition that Title VII prohibits discrimination on five specified grounds: “race, color, religion, sex, [and] national origin”; and “neither sexual orientation nor gender identity appears on that list.” Because there have been repeated, unsuccessful attempts in Congress to add those terms to Title VII’s list, in his view, “Title VII’s prohibition of discrimination because of ‘sex’ still means what it has always meant.”

Justice Brett Kavanaugh chose to dissent separately from Justice Alito, but his takeaway was much the same. He framed the question as whether “Title VII should be expanded to prohibit employment discrimination because of sexual orientation.” Nominally, at least, he agreed with the notion that “gay and lesbian Americans cannot be treated as social outcasts or as inferior in dignity or worth,” and he recognized that “the policy arguments for amending Title VII are very weighty.” But he believed that, “[a]s written, Title VII does not prohibit employment discrimination because of sexual orientation.”

TAKEAWAYS FOR EMPLOYERS

The Supreme Court’s landmark ruling will have a sweeping impact on federal anti-discrimination law, and the Court’s interpretation of Title VII is effective immediately.

Despite the previous uncertainty surrounding Title VII’s application to discrimination based on sexual orientation and gender identity, many employers already have employment policies that prohibit such discrimination, including to ensure compliance with more expansive state and local laws. Going forward, however, all employers covered by Title VII (those with 15 or more employees) will need to ensure that their policies and practices are consistent with the Supreme Court’s interpretation of the statute.

To that end, we recommend that employers do the following:

• Review and modify, as necessary, their anti-discrimination and anti-harassment policies to ensure that they prohibit discrimination and harassment against gay, lesbian, and transgender employees.
• Conduct training on their anti-discrimination policies, to ensure that their workforce—and management and supervisory employees, in particular—understand the need to make employment decisions without regard to the sexual orientation or gender identity (actual or perceived) of employees and applicants.
• Conduct training on their anti-harassment policies, to ensure that their workforce—and management and supervisory employees, in particular—understand that harassment on the basis of sexual orientation or gender identity is illegal and must not be tolerated.
• Review employment benefits to ensure that gay, lesbian, and transgender employees are not treated differently when it comes to healthcare coverage, parental leave, and other employment benefits and perquisites.

OTHER IMPLICATIONS

The Court’s decision comes on the heels of a recent US Department of Health and Human Services (HHS) announcement rolling back certain healthcare protections that had been extended to LGBT individuals as part of the Affordable Care Act (ACA). Although Bostock only interpreted the relevant language of Title VII, courts have interpreted Title IX’s protections to be coextensive with those under Title VII, and the ACA, in turn, looks to Title IX for purposes of its non-discrimination provisions.

Therefore, regardless of any changes that HHS may make at this point, the statutory language of ACA that prohibits discrimination in healthcare on the basis of sex will control. One can presume that the Supreme Court’s interpretation of sex discrimination under Title VII will be applied by courts in interpreting other statutes that prohibit sex discrimination. A list of those statutes can be found in Appendix C of Justice Alito’s dissent.

Contacts

If you have any questions or would like more information on the issues discussed in this LawFlash, please contact any of the following Morgan Lewis lawyers:

Washington, DC
Sharon P. Masling
David B. Salmons
Grace E. Speights

Philadelphia
Michael S. Burkhardt
W. John Lee

Princeton
Michelle Seldin Silverman

Silicon Valley
Michael D. Schlemmer