What’s Going on with LGBT Discrimination in the Workplace?

Three years ago, a HuffPost/YouGov poll found that 69% of Americans (incorrectly) believed that firing an employee for being gay was already illegal.  Now, in a post-Obergefell legal regime, those Americans would likely find it even more incredible that the federal government and most states still have not passed anti-discrimination laws, nor has the Supreme Court ruled such discrimination to be illegal.  Unlike the right to interracial marriage, which the Supreme Court upheld after Congress banned race discrimination, gay marriage came with no such analog.  The EEOC has interpreted Title VII to prohibit sexual orientation or transgender (gender identity) discrimination, but EEOC protection alone is inadequate.  This post examines what protections currently exist for LGBT workers and some possible paths forward for more comprehensive anti-discrimination protections.

Summary of Existing Protections for LGBT Workers

Federal/Federal Contract Workers

All federal employees and contract workers are protected from workplace discrimination based on sexual orientation and gender identity, due to a progression of Executive Orders and EEOC decisions spanning almost two decades.  Initially, President Clinton’s 1998 Executive Order prohibited sexual orientation discrimination only.  Then, in 2012, the EEOC expanded the protection to transgender individuals under Title VII in Macy v. Holder, which is binding on all federal agencies.  Two years later, President Obama’s Executive Order extended both protections to workers employed under federal contracts, which impacted about 20% of the American workforce.  Finally, in 2015, the EEOC decided Baldwin v. Foxx, in which it found that discrimination based on sexual orientation, and not just gender identity, categorically violates the Title VII prohibition on sex discrimination.

State Legislation

Currently, 18 states and D.C. have laws that prohibit discrimination based on sexual orientation and gender identity in the private sector.  Four additional states prohibit employment discrimination based on sexual orientation.  But fifty-two percent of LGBT people still live in states that do not prohibit either type of discrimination, and new state laws are preempting local non-discrimination measures.

Private Protections

Some businesses have self-imposed anti-discrimination policies.  The large majority (89%) of Fortune 500 companies prohibit sexual orientation discrimination and two-thirds prohibit gender identity discrimination.  Interestingly, these companies are not only procuring goodwill: having non-discrimination policies has been found to increase corporate profits.  Private corporations have also threatened to boycott states with legalized discrimination (more on this below).

Inadequacy of Existing Protections

Because some protections already exist, some think that additional ones are gratuitous.  For example, John Boehner opposed federal anti-discrimination legislation, contending that it was “unnecessary” because “people are already protected in the workplace.”  (This was before Foxx, so it is unclear what Boehner meant by “already protected.”)  However, these protections are inadequate because federal law only applies to workplaces with 15 employees or more.  Furthermore, EEOC decisions are not binding on federal courts, and the Supreme Court regularly denies deference to EEOC interpretations.

This inadequacy of EEOC protection is felt acutely in the 28 states with no anti-discrimination laws, where employers still openly discriminate against LGBT employees.  And discrimination against transgender employees is especially pronounced.  According to the 2011 National Transgender Discrimination Survey, 90% of transgender people reported harassment on the job and 47% experienced an “adverse job outcome” (such as being fired, not hired, or denied a promotion) because of their gender identity.

Paths Toward Anti-Discrimination

The current efforts towards achieving comprehensive anti-discrimination protections work in conjunction, with varying degrees of success.  Federal and state legislation has mostly stalled for now.  However, recently, there has been momentum building in the arenas of EEOC federal litigation, litigation by activist groups, and advocacy by private companies.

Federal and State Legislation: Stalled for Now

In 2013, we wrote an explainer on the Employment Non-Discrimination Act (ENDA), when the bill had just passed the Senate.  However, ENDA did not make it through the Republican-led House.  Though ENDA was introduced in almost every Congress since 1994, it has not been reintroduced since 2013.

In July 2015, several Democratic Senators and Representatives introduced an even broader bill—the Equality Act.  The Equality Act would amend Title VII to explicitly include sexual orientation and gender identity discrimination in employment, housing, public accommodations, and more.  President Obama has publicly supported the Act.  However, that bill is currently stuck in committee and has “little chance” being approved by a Republican Congress.

On the state level, progress has slowed.  Since 2013, only Maryland, Utah, and New York have passed or amended laws protecting sexual orientation and/or gender identity in private employment.  Conversely, in 2016, 200 anti-LGBT bills, have already been introduced at the state level—about half of which have been defeated.

Federal Litigation: Mixed Success

In early March, the EEOC filed its first-ever federal sex discrimination cases based on sexual orientation.  The complaints, available here and here, allege that the workers were subjected to sexual harassment due to their sexual orientation, which violates the sex discrimination prohibition of Title VII.  These lawsuits are in accord with the EEOC’s Strategic Enforcement Plan, which prioritizes coverage of LGBT workers under Title VII.  Advocacy groups such as the ACLU and Lambda Legal have also been quick to challenge anti-LGBT laws almost as soon as they are passed.  Interestingly, their challenge to the new North Carolina law overturning local protections for LGBT is a Constitutional challenge and is not based on Title VII.

The federal courts have not adopted the EEOC’s interpretation of Title VII; nor have they fully rejected it.  In 2004, the Sixth Circuit became the first federal court to extend protections to transgender employees in Smith v. City of SalemHowever, in a later case, the Sixth Circuit declined to extend the reasoning in Smith to a plaintiff who was perceived by co-workers to be gay.  The Eleventh Circuit recently concluded the same, and further litigation is pending there.  The Seventh Circuit has been similarly ambivalent.  In Muhammad v. Caterpillar Inc., a plaintiff whose claims of sex-based harassment due to sexual orientation were denied, but the court did amend the original decision to delete language stating that such claims were categorically not actionable under Title VII.

Private Action: Gaining Momentum

In addition to instituting their own anti-discrimination policies (see above), big businesses have been making headlines recently by publicly condemning anti-LGBT laws and threatening to boycott states with such laws.  For example, Google, American Airlines, and the NCAA have openly decried the new North Carolina law.  The NBA has also stated that the 2017 All-Star game may be relocated from Charlotte as a result.

Corporate advocacy is gaining traction and has seen some success.  It has undoubtedly increased coverage of the issue in mainstream news sources.  It has also had at least some effect on politicians.  Georgia’s Republican Governor recently vetoed a religious freedom bill that would have allowed employers to use religious beliefs to determine hiring and firing—a measure perceived as targeting LGBT workers.  The veto was largely attributed to pressure from private businesses, including Apple, Coca-Cola, Delta, the NFL, and Hollywood.  A similar story played out in South Dakota.  And yesterday Paypal took concrete action on its threats, announcing that it will rescind its plan to build a global service center in Charlotte.  However, some of the other boycott threats may prove toothless.  For example, ABC announced that, despite the company’s opposition to the law, production will go forward on at least one movie in North Carolina.

Conclusion

It will undoubtedly take some combination of the measures described here to achieve protection for all LGBT workers.  And meanwhile, new creative tactics are constantly emerging—such the New York public employee restrictions on travel to North Carolina and President Obama’s threat to revoke federal funding from the state.  It remains unclear which strategies will prove most effective.  However, what is clear is that, given the recent surge of anti-LGBT laws, the existing patchwork of protections is inadequate and, contrary to what many thought after Obergefell, LGBT anti-discrimination protections are far from “inevitable.