EEOC Sexual Orientation Ruling Brings Strong Reactions

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By Kevin McGowan and Chris Opfer

July 17 — An Equal Employment Opportunity Commission decision in a federal sector case that discrimination based on sexual orientation violates Title VII of the 1964 Civil Rights Act marks a “historic” step toward workplace protections for lesbian, gay, bisexual and transgender individuals, an LGBT rights advocacy group says.

In a July 16 statement, the Human Rights Campaign hailed the EEOC's ruling that a male air traffic controller who alleges the Department of Transportation denied him a promotion because he is gay can pursue a claim under Title VII's prohibition against sex discrimination.

The commission decision, approved on a 3-2 vote, marks the first time the EEOC formally has ruled Title VII prohibits bias based on sexual orientation.

In a 2012 case, the EEOC ruled a transgender federal employee could pursue a Title VII claim based on the same theory that alleged bias based on failure to conform with gender stereotypes is sex discrimination. The EEOC administrative decisions don't cover private sector employment, but they indicate the agency's interpretation of Title VII and can have persuasive effect when courts consider private sector claims.

EEOC Chair Jenny Yang and Commissioners Chai Feldblum and Charlotte Burrows, all Democrats, approved the agency's decision. Commissioners Constance Barker and Victoria Lipnic, both Republicans, voted against the decision but didn't issue a written dissent, the EEOC said.

The EEOC ruling was drafted by the commission's Office of Federal Operations, then circulated among the five commissioners for revisions and ultimately a vote on a final version.

“Sexual orientation discrimination is sex discrimination because it necessarily entails treating an employee less favorably because of the employee's sex,” the EEOC said.

Bill Expected Soon 

“This historic ruling by the EEOC makes clear they agree workplace discrimination on the basis of sexual orientation, much like gender identity, is illegal,” said Chad Griffin, president of the Human Rights Campaign in Washington. “While an important step, it also highlights the need for a comprehensive federal law permanently and clearly banning LGBT discrimination beyond employment to all areas of American life.”

The EEOC's ruling “sends a clear message that discrimination based on sexual orientation or gender identity has no place in a civilized society,” Rep. David Cicilline (D-R.I.) said in a July 17 statement. “It’s important that Congress pass comprehensive anti-discrimination legislation that protects LGBT individuals in employment, housing, credit, jury service, and other core areas of daily life. I look forward to leading this fight in the House of Representatives.”

Cicilline is among a group of congressional Democrats working on proposed legislation that would ban sexual orientation discrimination in employment and other areas, including housing and credit. The bill is expected to be unveiled soon.

Ruling Not a Surprise 

The EEOC's ruling “wasn't a surprise” in that the commission has been accepting discrimination charges from private sector and public sector employees “for some time,” said Greg Nevins, counsel for Lambda Legal's southern regional office in Atlanta.

“It seemed like it was only a matter of time that they would have to issue a decision on the merits that lays out what their thinking was in full detail,” Nevins told Bloomberg BNA July 17. Since the EEOC's 2012 ruling that Title VII covers discrimination against transgender workers, “people have been waiting to see when the other shoe would drop,” Nevins said.

Title VII doesn't mention sexual orientation and courts historically have ruled the statute's ban on sex discrimination doesn't cover bias based on sexual orientation. For more than 20 years, the Employment Non-Discrimination Act, which would amend Title VII to ban employment discrimination based on sexual orientation and gender identity, has been introduced but it has never been approved by both chambers in the same Congress.

ENDA has yet to be introduced in the current Congress, as gay rights supporters are lining up behind the broader bill not limited to the workplace.

In Macy v. Holder, the EEOC in 2012 ruled a federal agency's alleged discrimination against a transgender employee might violate Title VII. Some federal appeals courts have allowed Title VII claims by transgender individuals to proceed, based on the theory that federal law prohibits discrimination based on failure to conform with gender stereotypes. The EEOC in 2014 filed its first two Title VII lawsuits alleging unlawful discrimination against transgender workers in the private sector.

The courts' rationale for denying sexual orientation bias coverage under Title VII largely “has been ‘look at all these old cases,’ and really not a lot beyond that,” Nevins said. “To have that kind of a counterweight where courts have to at least wrestle with this and take it into account is a game-changer.”

The EEOC's decision “is going to put an end to the vapid superficial treatment that this legal question has been getting for so long,” he said.

Many employers over the past few years have settled EEOC charges filed by workers alleging sexual orientation discrimination, Nevins said. “I think there will be some employers that want to fight this, but there are already a lot who have said ‘we’re not going to be the ones arguing that employers can discriminate against gay and lesbian men and women,' ” he said.

Advocates for LGBT rights still want to see ENDA or similar federal legislation enacted, Nevins said. “The gold standard is to have explicit legislation barring this form of discrimination,” he said.

More Litigation Predicted 

There was “some inevitability” to the EEOC's decision that Title VII covers sexual orientation discrimination given the commission's public statements and positions over the last 18 months or so, said Don Livingston, a partner with Akin Gump Strauss Hauer & Feld in Washington.

The “next phase” probably will be the EEOC filing Title VII lawsuits against employers, alleging sexual orientation bias, Livingston told Bloomberg BNA July 17.

As shown in its decision, the EEOC now is “taking this issue straight on” rather than making “nuanced” arguments, said Livingston, a former EEOC general counsel who now represents employers.

Everyone involved with the issue believes at some point Congress will address sexual orientation bias in employment, but the issue is what happens in the interim, Livingston said.

Livingston said he personally “abhors the idea of discrimination based on sexual orientation” but thinks the EEOC would have noticed sometime sooner during the past 50 years if Title VII actually prohibited it.

“I do not find the EEOC’s arguments compelling,” he said. “While it may be good social policy, I don’t believe it’s a correct interpretation” of Title VII.

Most large employers already ban sexual orientation bias in their internal anti-discrimination policies, so the EEOC decision won’t be “transformational” in the sense it would require changes in such policies, Livingston said.

But the EEOC’s action “likely will drive more litigation” and place more disputes alleging sexual orientation bias before the courts, he said.

EEOC Cites Plain Language 

The issue of whether Title VII covers sexual orientation discrimination isn't really new, as the EEOC previously considered the issue in the 1970s and found no statutory coverage, Feldblum said.

But given the subsequent U.S. Supreme Court decisions interpreting Title VII, the EEOC in its latest decision is “applying the words of the law precisely in the way that we should,” Feldblum told Bloomberg BNA July 17.

Title VII's ban on sex discrimination “means that employers may not ‘rely upon sex-based considerations' or take gender into account when making employment decisions,' ” the EEOC said in the decision. “This applies equally in claims brought by lesbian, gay, and bisexual individuals under Title VII.”

While the EEOC's 2012 ruling that Title VII protects transgender individuals relied solely on the gender stereotyping theory, the current decision uses “more of a textual basis” to find Title VII's sex discrimination ban prohibits sexual orientation bias, Feldblum said.

“When an employee raises a claim of sexual orientation discrimination as sex discrimination under Title VII, the question is not whether sexual orientation is explicitly listed in Title VII as a prohibited basis for employment actions,” the EEOC said in its decision. “It is not.”

“Rather, the question for purposes of Title VII coverage of a sexual orientation claim is the same as any other Title VII case involving allegations of sex discrimination—whether the [federal employing] agency has ‘relied on sex-based considerations' or ‘take[n] gender into account' when taking the challenged employment action.' ”

The Transportation Department complainant, whose name is redacted in the EEOC's decision, alleged the department “relied on sex-based considerations” and “took his sex into account” when it didn't promote him to a permanent front-line manager position at the Miami airport, the EEOC said.

The complainant therefore stated a sex discrimination claim, the EEOC said.

“Indeed, we conclude that sexual orientation is inherently a “sex-based consideration,” and an allegation of discrimination based on sexual orientation is necessarily an allegation of sex discrimination under Title VII,” the EEOC said. “A complainant urging that an agency took his or her sexual orientation into account in an employment action necessarily argues that the agency took his or her sex into account.”

The decision represents “the cleanest, clearest explication of a common-sense application” of Title VII’s sex discrimination ban to sexual orientation bias claims, Feldblum said.

Although the EEOC’s ruling is a “hugely important decision,” the best way to ensure “actual certainty” for protecting gays in the workplace is passage of federal legislation, Feldblum said.

Feldblum said she hopes one outcome of the EEOC’s decision is “purely educational” in that employers and workers understand the commission considers sexual orientation discrimination illegal under Title VII.

The EEOC has received about 1,600 charges alleging sexual orientation discrimination since January 2013, Feldblum said. She said the commission's decision could spur more charges but said she hopes many can be settled without litigation.

It remains to be seen how the courts will react to the EEOC's interpretation of Title VII, Feldblum said.

“I think it's likely a significant number of courts will agree because it's a common-sense interpretation,” she said.

Associational Bias, Gender Stereotyping 

Sexual orientation discrimination also is “associational discrimination” on the basis of sex, the EEOC said in its decision. The commission analogized to cases in which courts have held white or black employees penalized for being in interracial marriages or for associating with people of a different race state race discrimination claims under Title VII.

“Title VII similarly prohibits employers from treating an employee or applicant differently than other employees or applicants based on the fact that such individuals are in a same-sex marriage or because the employee has a personal association with someone of a particular sex,” the EEOC said. “Adverse action on that basis is, ‘by definition,' discrimination because of the employee's or applicant's sex.”

Sexual orientation discrimination also is sex discrimination because “it necessarily involves discrimination based on gender stereotypes,” the EEOC said. In the wake of Price Waterhouse v. Hopkins, 490 U.S. 228, 49 FEP Cases 954 (1989), federal courts and the EEOC itself “have recognized that lesbian, gay, and bisexual individuals can bring claims of gender stereotyping under Title VII if such individuals demonstrate that they were treated adversely because they were viewed—based on their appearance, mannerisms or conduct—as insufficiently ‘masculine' or ‘feminine,' ” the commission said.

Discrimination based on failure to conform with the gender stereotype of attraction to people of the opposite sex also violates Title VII, the EEOC said.

“Congress may not have envisioned the application of Title VII to these situations,” the EEOC said. But the commission cited Oncale v. Sundowner Offshore Servs., Inc., 523 U.S. 75, 76 FEP Cases 221 (1998), in which the Supreme Court recognized same-sex harassment as a Title VII claim, for the principle that “statutory prohibitions often go beyond the principal evil” they were enacted to combat “to cover reasonably comparable evils.”

“Interpreting the sex discrimination prohibition of Title VII to exclude coverage of lesbian, gay or bisexual individuals who have experienced discrimination on the basis of sex inserts a limitation into the text that Congress has not included,” the EEOC said. “Nothing in the text of Title VII ‘suggests that Congress intended to confine the benefits of [the] statute to heterosexual employees alone.”

To contact the reporters on this story: Kevin McGowan in Washington at kmcgowan@bna.com; Chris Opfer in Washington at copfer@bna.com

To contact the editor responsible for this story: Karen Ertel at kertel@bna.com

Text of the EEOC decision is available at http://op.bna.com/dlrcases.nsf/r?Open=kmgn-9yhkj7.