On June 15, 2020, the US Supreme Court changed the face of federal workplace anti-discrimination laws. In Bostock v. Clayton County, the Court ruled that Title VII's prohibition against job discrimination on the basis of "sex" includes sexual orientation and gender identity. Though Title VII of the Civil Rights Act of 1964 has long-prohibited employers from discriminating on the basis of color, national origin, race, religion, and sex, the question of whether sexual orientation and gender identity were included in the definition of "sex" went unsettled -- until now.

"An 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," Justice Neil Gorsuch wrote for the court in the 6-3 opinion. "Sex plays a necessary and undisguisable role in the decision, exactly what Title VII forbids." Justice Gorsuch and fellow conservative Chief Justice John Roberts joined liberal Justices Breyer, Ginsburg, Kagan, and Sotomayor in the majority.

Justices Samuel Alito, Brett Kavanaugh and Clarence Thomas dissented, with Justice Alito stating that the concept of discrimination "because of 'sex' is different from discrimination because of 'sexual orientation' or gender identity.'" Justice Kavanaugh wrote in a separate dissent that the court had taken Congress' job by rewriting the law to include gender identity and sexual orientation, but acknowledged that the decision represents an "important victory achieved today by gay and lesbian Americans."

The decision, arising from three consolidated cases filed by two gay men and a transgender woman who each sued for discrimination after they lost their jobs, is expected to have a tremendous immediate impact on almost 4 million LGBTQ workers. Out of an estimated 8.1 million LGBT workers aged 16 or older in the US, nearly half (3.9 million) live in one of the 28 US states that does not provide statewide statutory protections on the basis of one's gender identity or sexual orientation. The new federal mandate now means employers in all 50 states that are covered by Title VII cannot discharge, refuse to hire, or otherwise discriminate against LGBTQ applicants or employees with respect to pay and terms and conditions of employment based on their gender identity and sexual orientation.

The final few paragraphs of the opinion, however, suggests that in certain circumstances, religious liberty claims could supersede Title VII protections. In other words, where the discriminatory conduct in question is motivated by religion, this means that Title VII's protections for LGBTQ workers may be "displace[d]."

Justice Gorsuch suggested that under certain circumstances, the First Amendment's Free Exercise Clause or the Religious Freedom Restoration Act could trump Title VII protections. The former is textbook-familiar for most ("Congress shall make no law…prohibiting the free exercise [of religion]"); the latter is a 1993 federal law exempting individuals from complying with federal law if they can show the law "substantially burden[s] that person's exercise of religion." The Religious Freedom Restoration Act permits the government to burden a person's exercise of religion "only" if the government demonstrates the application of the burden to the person (1) furthers a compelling governmental interest; and (2) is the least restrictive means of furthering that compelling governmental interest. Whether preserving the Title VII rights of an LGBTQ employee meets this standard is not yet clear.

And the Supreme Court has a fairly-recent track record of protecting religious liberty claims. For example:

  • In Town v. Greece of Galloway (2014), the Court allowed public meetings to be opened with prayer;
  • In Trinity Lutheran Church of Columbia Inc. v. Comer (2017), the Court struck down a policy denying taxpayer-funded grants to churches or religious institutions;
  • In The American Legion v. American Humanist Association (2019), the Court ruled that an enormous cross did not have to be removed from government land;
  • In the well-known Burwell v. Hobby Lobby (2014), the Court held that not-for-profit corporations were "persons" with religious rights, allowing businesses with religious objections to covering contraception to be exempt from the Affordable Care Act's requirement; and
  • In Masterpiece Cakeshop v. Colorado Civil Rights Commission (2018), the Court ruled in favor of a baker who claimed his religious beliefs kept him from making a wedding cake for a same-sex couple, after the Colorado Civil Rights Commission ruled that the baker's refusal violated the state's statute prohibiting discrimination against LGBTQ individuals.

 

Practical Considerations

Practically speaking, what does this all actually mean for employers right now? And what challenges can we expect to see in the future as a result? Let's take a look.

  • Which Employers Does This Apply To? Though the decision is a watershed moment, and is a mandate from the highest court of the land, it does not apply to all employers. Title VII only applies to employers with 15 or more employees. Employers with fewer than 15 employees will continue to be governed by applicable state and local anti-discrimination laws-to the extent employers operate in states or municipalities where such laws have been enacted.

  • Does This Apply to Gig Workers Too? Title VII applies to employees, not independent contractors. Gig workers and other independent contractors who are properly classified as independent contractors will not benefit from this ruling. It remains to be seen whether LGBTQ gig workers or independent contractors will challenge their classification more frequently to seek Title VII's protections.

  • Are You Already Covered Under State Law? If you are an employer covered by Title VII and have employees in the 22 states that have already enacted statutory protections on the basis of gender identity and sexual orientation, then this decision will likely not have an impact on your workforce. On the other hand, if you are an employer covered by Title VII and have employees in the 28 states that do not currently provide employment protections on the basis of gender identity or sexual orientation, then the expanded protections will now apply to applicants and your employees (keep reading for what to do next).

  • Are Your Policies Explicit? If Not, Update Them. If you are an employer covered by Title VII and your employment policies do not already include anti-discrimination and anti-harassment provisions specifically prohibiting discrimination and harassment on the basis of sexual orientation or gender identity, update your policies to explicitly include both categories. Provide the updated policies to employees and require them to sign an acknowledgement that they have received and understand the policy.
  • Are Your Managers and Supervisors Trained? Have you trained your managers and supervisors regarding anti-discrimination and anti-harassment policies specific to sexual orientation and gender identity issues, and to keep an eye out for any such discrimination and harassment in the workplace? If not, do so as soon as possible, and keep a record of who has received the training.

  • What About Bathrooms for Transgender People? This decision does not address bathrooms for transgender people. Certain state and local laws might, though, so check your specific jurisdiction. Several states (such as California, Illinois and Vermont) and municipalities (including Denver, Washington, DC and Hoboken, NJ) have laws requiring single occupancy public bathrooms to be gender neutral, and some extend the laws to business establishments, which could include the workplace. OSHA has issued guidance on best practices for restroom access for transgender workers, but there is no federal law specifically addressing restrooms for transgender workers. With Bostock, challenges to employers' failure to provide appropriate restroom options for transgender employees--brought as claims of discrimination on the basis of gender identity regarding a term or condition of employment-are likely in the works.

  • What About Work Attire Requirements? Though the Court's decision did not specifically address work attire requirements or dress codes (or gender expression generally), the decision can likely be interpreted to mean that Title VII, in prohibiting discrimination based on gender identity, prohibits work attire requirements that would not allow an individual to present as their preferred gender. The employer's dress code in one of the consolidated cases, R.G. & G.R. Harris Funeral Homes, Inc. v. EEOC, was an issue. Aimee Stephens, the plaintiff, presented as a male when she was hired and wore slacks as required by the company's dress code for men. When she disclosed to the company six years later that she intended to live and work as a woman for a year, coming to work wearing a skirt as required of female employees, and would then have sex-reassignment surgery, the company fired her. The owner of the company testified he fired her because Stephens "was no longer going to represent himself as a man. He wanted to dress as a woman." How the decision will play out in the workplace and what it means for other dress code issues (such as whether employers can have dress codes segregated by sex) is not yet settled. In the meantime, companies should permit employees to dress in accordance with the dress code based on their gender identity.

  • What Should Employers Do if Supervisors Refuse to Follow the Law Based on Religious Beliefs? Companies should require supervisors to follow the law (and company policies). Though the Court's opinion signaled that, in certain situations, religious liberty claims could override Title VII protections, that issue has not yet been decided. Employers can be held vicariously liable for supervisors' discriminatory behavior under Title VII, including creation of a hostile work environment, if the employer has empowered the supervisor to take tangible employment actions against the victim (hiring, firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing a significant change in benefits). Even when supervisors aren't empowered with those duties, an employer can still be vicariously liable when the hostile work environment was created by a co-worker (including a supervisor or manager), and the employer knew or reasonably should have known about the harassment, but failed to stop it. In addition, several states have laws with a lower bar for finding an employer liable for an employee's discriminatory actions against a co-worker. Regardless of the outcome, those fact-intensive issues can be costly for employers to litigate, and employee morale will likely take a dive if a supervisor is discriminating against a protected employee and is permitted to continue without employer intervention. Employers who have supervisors who refuse to follow the law-regardless of the reason-should consider whether keeping the supervisor around is worth the cost of lowered employee morale and the expense of defending a lawsuit.

  • What if Employees are Vocal in the Workplace about their Religious-Based Disagreement with Bostock or the Company's Support for LGBTQ Rights? Employees are not all going to be of the same mindset or have the same beliefs. Companies may have employees who disagree with the Court's opinion, or who don't agree with the Company's support for LGBTQ rights. Employees are entitled to their beliefs, and are entitled to discuss them privately with others, but they are not entitled to discriminate against or harass co-workers. In addition, employees are not entitled to make statements about the company that are egregiously offensive or publicly disparage the company (or otherwise violate the company's code of conduct and/or social media policies).

  • With that being said, non-supervisory employees do have the right to engage in "protected, concerted activity" under the National Labor Relations Act, which allows them to take action such as:
  • talking with co-workers about wages, benefits, or other working conditions;
  • participating in a concerted refusal to work in unsafe conditions; and
  • joining with co-workers to talk directly to management, a government agency, or the media about problems in the workplace.

Making a public statement to the news media, on social media, or on a Company website or intranet that disparages the Company for its support of LGBTQ rights would likely not constitute such "protected, concerted activity." Neither would public speech that discriminates against or is harassing towards co-workers. To avoid claims of vicarious liability for discrimination/ harassment, to avoid flattened employee morale, and to preserve the Company culture, employees exhibiting such non-protected behavior should be immediately disciplined in accordance with Company policy. However, it goes without saying that employers may not discipline or terminate an employee for merely holding religious beliefs that may go against supporting LGBTQ rights.

What's Next?

How the courts will balance religious liberty claims with Title VII's new protection of LGBTQ employees remains to be seen, but challenges are certain to come - and quickly, especially from conservative or faith-based groups, who were less-than-thrilled with the Bostock decision. We will be monitoring developments resulting from this landmark decision, and will keep you updated as we do. For help navigating these and other employment issues, contact your Baker McKenzie employment attorney.

Explore More Insight