The U.S. Supreme Court has ruled 6-3 that federal law prohibits employers from discriminating against applicants and employees because they are gay or transgender.
Title VII of the Civil Rights Act prohibits employers with 15 or more employees from discriminating against individuals because of sex and certain other protected characteristics. Title VII doesn't specifically address sexual orientation or transgender status.
In recent years, though, the U.S. Equal Employment Opportunity Commission, which is the agency that enforces Title VII, took the position that protections on the basis of sex extend to sexual orientation and gender identity (a person's gender-related identity, appearance, or behavior, regardless of whether it is different from that traditionally associated with the person's physiology or assigned sex at birth).
Meanwhile, federal courts have generally been split on the question of whether Title VII bars discrimination because of sexual orientation and transgender status. The Supreme Court was asked to resolve the issue.
Supreme Court Case:
The U.S. Supreme Court heard arguments from three cases. In two of the cases, gay men said they were fired because of their sexual orientation. In the third case, an employee alleged that she was fired because she notified her employer that she planned to live and work as a woman after previously presenting as a man. In all three cases, the employers argued that Title VII doesn't protect individuals from discrimination based on sexual orientation or transgender status.
In ruling in favor of the employees, the U.S. Supreme Court held that sexual orientation and transgender status are inextricably bound up with sex, because to discriminate on these grounds requires an employer to intentionally treat individual employees differently because of their sex, which is forbidden by Title VII.
The court concluded its ruling by stating: "In Title VII, Congress adopted broad language making it illegal for an employer to rely on an employee's sex when deciding to fire that employee. We do not hesitate to recognize today a necessary consequence of that legislative choice: An employer who fires an individual merely for being gay or transgender defies the law."
Employers with 15 or more employees should review their policies, practices, and supervisor trainings to determine if they need to make updates in light of the Supreme Court decision. Please contact your dedicated service professional with any questions.
Note: While Title VII applies to employers with 15 or more employees, many states and local jurisdictions have enacted laws that expressly prohibit employers from discriminating against applicants and employees on the basis of their sexual orientation and gender identity and may cover smaller employers. Therefore, all employers should check their state and local laws to ensure compliance.