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In a 6-3 decision, the U.S. Supreme Court ruled in June that federal law protects gay and transgender workers from workplace discrimination. In the majority opinion authored by Justice Neil Gorsuch in Bostock v. Clayton County, Georgia, the court held that Title VII of the Civil Rights Act of 1964 prohibits employers from firing workers on the basis of sexual orientation or gender identity. In light of this landmark ruling, employers should take some key steps to comply with the law.
Before the court’s June 15 decision, 21 states already explicitly mentioned sexual orientation and/or gender identity in their anti-discrimination statutes. Now, all employers with 15 or more employees must understand that Title VII protections from sex discrimination also ban discrimination against LGBTQ employees. Title VII prohibits employers from discriminating “against any individual with respect to his compensation, terms, conditions, or privileges of employment,” on the basis of race, color, religion, sex or national origin.
Many employers already have workplace policies prohibiting discrimination and harassment based on sexual orientation, gender identity and transgender or gender-transitioning status. As more transgender people come out and undergo gender transition while employed, all companies should make sure they have nondiscriminatory policies and practices in place.
Companies without such standards should update their policies immediately to explicitly include those now-protected groups, as well as workers in any other groups protected by federal, state and local laws.
Employers should train managers and all employees on anti-discrimination and anti-harassment policies, with a particular focus on LGBTQ bias. Some companies may consider implementing a diversity program and/or bringing in diversity and inclusion consultants to lead training sessions.
Employers should promptly investigate any allegations of harassment based on sexual orientation or gender identity, much as they approach investigations of sexual harassment or discrimination claims. Companies should be aware of other claims, including incorrect pronoun use for transgender workers or the exclusion of spouses and significant others in LGBTQ relationships from company events (when heterosexual couples are included at those events).
Beyond hiring, promotions and termination, the law’s protections also extend to salary and employee benefits, including health care, insurance and retirement plan eligibility. Employers may also be required to modify employee benefits plans and any other offerings that might affect LGBTQ employees differently from other employees.
Employers should also review their group health insurance plans for medical coverage issues that might subject them to sex-discrimination claims. For example, companies that exclude same-sex spouses or domestic partners from plan coverage that would otherwise cover opposite-sex spouses or domestic partners might need to expand coverage to same-sex spouses.
Additionally, employers may need to check for exclusions in group health insurance plans of services for transgender-specific needs, including services related to gender dysphoria as well as restrictions on mental health services related to gender dysphoria.
Until the decision, more than half of U.S. states offered no laws protecting workers from being fired for being gay, bisexual or transgender. Now, millions more who say their employers discriminated against them because of their LGBTQ status have the right under Title VII to sue them—the same right that employees who claim racial and gender discrimination have.
Employers accused in discrimination cases have the opportunity to show nondiscriminatory reasons for their actions, so they should document their employee-related actions, conduct accurate performance evaluations and maintain anti-discrimination policies.
Employers with fewer than 15 workers will continue to be governed by applicable state and local anti-discrimination laws. Workers who are classified as independent contractors generally aren’t covered by anti-discrimination and other laws that protect employees.
Employers should also be aware of labor and employment issues the decision left unresolved. In a guidance document issued June 30, 2020, the Equal Employment Opportunity Commission noted that the Supreme Court’s ruling doesn’t address related issues under Title VII such as dress codes, bathroom access or locker room access.
Workplace religious liberties issues also remain unresolved. The court noted that the cases addressed in its LGBTQ discrimination ruling don’t address how Title VII protections might clash with an employer’s religious liberties—a conflict that will likely arise in future employment litigation related to sexual orientation and gender identity.
Separately, the U.S. Department of Health and Human Services announced a final rule three days before the Bostock decision that eliminated anti-discrimination protections based on gender identity in health care and health insurance. A group of state attorneys general and a coalition of LGBTQ organizations are suing the Trump administration to block the HHS rule. While the Bostock decision doesn’t directly affect the health care rule, opponents of the rule hope it might bolster those efforts.
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