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EEOC Files Groundbreaking Sexual Orientation Discrimination Suits

A patchwork of US state and federal laws address whether employers may discriminate on the basis of sexual orientation. Twenty-two states and the District of Columbia prohibit sexual orientation discrimination in the workplace (three of those states prohibit only sexual orientation, not gender identity discrimination.) At the federal level, executive orders protect lesbian, gay, bisexual, and transgender (LGBT) employees working for federal agencies and contractors. But LGBT employees at private companies have traditionally not been protected by Title VII, the federal antidiscrimination law which bars sex discrimination but not sexual orientation discrimination. The Equality Act, introduced into Congress last year, would amend Title VII by explicitly adding sexual orientation as a protected characteristic. Although President Obama and both democratic presidential candidates support the Act, as well as several major US employers (e.g., Apple, American Airlines, and Nike), the prospects for the bill's passage in the Republican-controlled Congress are dim.

The Equal Employment Opportunity Commission (EEOC) — the federal agency charged with enforcing Title VII — is not waiting for Congress. EEOC is now bringing suits against private employers alleging sexual orientation discrimination in violation of Title VII. The first two suits are EEOC (Baxley) v. Scott Medical Health Center (W.D. Penn. March 1, 2016) and EEOC (Boone) v. Pallet Companies (D. Md. March 1, 2016).

EEOC (Baxley) v. Scott Medical Health Center and EEOC (Boone) v. Pallet Companies

In the first suit, EEOC claims that a gay male telemarketer (Baxley) at a Pennsylvania medical clinic was harassed by his manager (McClendon) because of his sexual orientation. According to the complaint, McClendon made homophobic and anti-gay slurs to Baxley three to four times per week. McClendon also made other highly offensive comments about Baxley's relationship and sexual relations with his male partner. Baxley complained to the clinic president but the president refused to stop the harassment. Baxley resigned in response to an alleged sexually hostile work environment.

In the second suit, EEOC claims that a gay female forklift operator (Boone) at a Maryland pallet supplier was harassed by her shift supervisor (Lowry) because of her sexual orientation. According to the complaint, Lowry routinely made comments about Boone's sexual orientation and appearance and quoted biblical passages on same-sex behavior. At one point Lowry blew a kiss, stuck out his tongue, and then circled his tongue toward Boone in a sexually suggestive manner. Boone complained to management and HR about Lowry's conduct. A few days after doing so, the company fired Boone allegedly in retaliation for complaining about the harassment.

The two suits are part of EEOC's Strategic Enforcement Plan to expand the Title VII rights of LGBT workers in the private sector. EEOC filed three suits last year challenging discrimination against transgender employees: EEOC (Branson) v. Lakeland Eye Clinic (M.D. Fla. Sept. 2014); EEOC (Stephens) v. R.G. & G.R. Harris Funeral Homes (E.D. Mich. Sept. 2014); EEOC (Austin) v. Deluxe Financial Services (D. Minn. June 2015.) EEOC argued in each case that transgender discrimination is by its very nature sex discrimination because the employee does not conform to gender-based expectations, preferences, or stereotypes.

EEOC now argues in similar fashion that an employer who discriminates on the basis of sexual orientation necessarily discriminates on the basis of sex. EEOC first adopted this position in a June 2015 federal-sector decision and expanded upon it in January 2016 briefs filed with the US Appeals Court for the Eleventh Circuit.

EEOC's position that sexual orientation discrimination is sex discrimination relies on three basic arguments. First, EEOC argues that sexual orientation discrimination necessarily involves sexual stereotyping—which the Supreme Court held impermissible in Price Waterhouse v. Hopkins, 490 US 228 (1989) — because it results in adverse treatment of employees who do not conform to heterosexually defined gender stereotypes and, in particular, the stereotype that people are attracted to members of the opposite sex. Second, EEOC argues that sexual orientation discrimination involves gender-based associational discrimination. Since an employer cannot discriminate against an employee based on the race of the employee's spouse, it should not be able to do so based on the gender of the employee's spouse. Finally, EEOC argues that Title VII prohibits sex-based considerations in employment decisions and sexual orientation discrimination by nature requires consideration of a plaintiff's sex. That is, sexual orientation discrimination cannot be understood without reference to the employee's sex.

Advice for in-house counsel

In 2013 EEOC began recording administrative charges alleging gender identity and sexual orientation discrimination. The number of those charges has steadily increased — through the first quarter of FY2015 EEOC recorded over 1000 such charges. EEOC's recording efforts along with its two recent sexual orientation suits signal that the agency is fully committed to advancing LGBT rights in federal court. Although EEOC takes on a small number of cases, its sexual orientation suits almost certainly will encourage private plaintiffs' attorneys to follow its lead.

The risk of litigation (and the adverse publicity that comes along with it) is not in-house counsel's only concern. The Public Research Institute recently found that about 70 percent of Americans support gender identity and sexual orientation protections in the workplace. That percentage is likely higher for millennials — a critical customer base and hiring pool for most employers. Major corporations increasingly are expressing a clear commitment to diversity by including LGBT non-discrimination language in agreements with their suppliers and business partners. Regardless of the current state of the law, in-house counsel would be well advised to ensure that company policies, codes of conduct and ethics, and workplace training include a commitment to provide equal employment opportunities to all employees regardless of their gender identity or sexual orientation.

About the Authors

Stephen Harrison is corporate counsel at Thomson Reuters and focuses his practice on privacy and general corporate matters.

Stephen Stecker is an attorney in the Dallas office of Thompson & Knight and focuses his practice on employment and labor matters.

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