Many nonprofit employers may need to take a hard look at their workplace restroom policies for transgender employees. Earlier this year, the U.S. Equal Employment Opportunity Commission (EEOC) obtained an $115,000 settlement payment on behalf of a transgender employee who had been barred from using an employer's women's restroom. In an effort to accommodate the transgender employee in that case, the employer had previously provided the employee with access to a gender-neutral single-occupancy restroom. That was not enough, however. According to the EEOC, transgender employees have a right to use multi-occupancy workplace restrooms that correspond to the gender with which they identify.

The EEOC's position raises several issues for employers. In addition, at least 19 states, the District of Columbia, and Puerto Rico now have laws that prohibit employers from discriminating against employees based upon their status as transgender. Here are a few questions nonprofit employers may be asking themselves, as well as suggestions for how to avoid costly litigation.

When Is an Employee Considered Transgender?

Picture this: an employee notifies an employer's human resources department that the employee is transgender. But has the employee had gender reassignment surgery? Has the employee legally changed his or her name? Has the employee begun hormonal therapy, and, if so, when will the therapy be complete? While these are common questions, they are largely irrelevant and, in some cases, illegal to ask an employee. The definition of transgender for most jurisdictions is simple: An employee is considered transgender when he or she identifies with a gender that is different from the one he or she was assigned at birth.

This means nonprofit employers should not require that an employee undergo medical procedures, legally change his or her name, or submit other "proof" before being considered transgender. Once the employee informs the employer that he or she identifies with a gender different from the one he or she was assigned at birth, the employer should consider the employee transgender.

What Restroom Access Must an Employer Provide to Transgender Employees?

Although the laws vary slightly across different jurisdictions, most transgender anti-discrimination laws require employers to provide transgender employees with the same level of restroom access as other employees. Accordingly, employers should permit a transgender employee to access worksite restrooms based upon the gender with which he or she identifies. Simply providing access to single-occupancy restrooms will not do.

What about Complaints from Other Employees?

Some nonprofit employers may find themselves caught between two or more employees' competing views about transgender employees' rights. It is not uncommon for an employer to receive a complaint from a non-transgender (also sometimes referred to as "cisgender") employee regarding the shared use of a worksite restroom with a transgender employee. However, such complaints do not excuse an employer's failure to provide transgender employees with equal restroom access, now that more and more jurisdictions consider transgender status to be akin to an employee's race, age, disability, or any other protected characteristic.

This rule highlights the importance of regular workplace training regarding anti-harassment, transgender sensitivity, and an employer's restroom policies. Among other things, proper training can prepare supervisors to respond to transgender employees' requests for restroom access. A supervisor's initial response is often a big factor in whether a discrimination claim will follow.

What about Single-Occupancy Restrooms?

Single-occupancy restrooms are a potential solution for many nonprofit employers. Such restrooms help provide a more private space for transgender and cisgender employees alike. As discussed above, however, access to single-occupancy restrooms is not sufficient to comply with most transgender anti-discrimination laws. If an employer does provide access to single-occupancy restrooms, the employer should post a sign that clearly informs employees that the single-occupancy restroom is available to any gender. At a minimum, the employer should not have signs indicating that a single-occupancy restroom is available to only one gender and not the other.

What about Multi-Occupancy Restrooms?

The harder questions often involve access to an employer's multi-occupancy restrooms. If an employer has multi-occupancy restrooms at its workplace, there is usually a potential access issue for transgender employees. There is at least one easy solution – make all workplace restrooms unisex. If an employer's restrooms are completely unisex, the potential discrimination issue typically disappears because anyone may access any restroom. The employer must simply ensure there is a private space available within the restrooms, such as a lockable stall, which most multi-occupancy restrooms already have.

In the alternative, employers must take other steps to ensure that transgender employees may access the single-sex multi-occupancy restrooms for the gender with which they identify. This often requires a discussion between the employer and transgender employee. Employers also should have a policy in place for how their managers will respond to a transgender employee's request for restroom access, as well as specific procedures for addressing other employees' requests or comments regarding transgender employees. Jokes, insults, or thinly veiled criticisms of an employee's transgender status, even if made by non-managerial employees, may support a hostile-work-environment claim against an employer.

What Are the Penalties for Not Providing Equal Restroom Access to Transgender Employees?

Not complying with the transgender anti-discrimination laws is often an expensive proposition. In the case referenced above, the $115,000 settlement included money for lost wages, emotional distress, and attorneys' fees. That case involved just a single employee. Larger employers with a higher proportion of transgender employees could face more costly class-action lawsuits. The potential awards for emotional distress damages can be particularly expensive because of the psychological harm transgender employees often suffer when they are denied access to the restroom of their choosing. Some laws also carry significant civil penalties. Employers in New York City, for example, may face a maximum penalty of $250,000 if they do not provide adequate restroom access to transgender employees.

Employers also may face non-monetary consequences. The settlement agreement for the case noted above included a long list of non-monetary obligations for the employer, including regular transgender employee rights training for its workforce, the implementation of new bathroom-access policies, posting new bathroom signs at worksites, and annual reporting requirements regarding internal complaints of discrimination against or harassment of transgender employees.

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As the laws regarding transgender employees continue to evolve, nonprofit employers should proactively take steps to ensure that they are ready to respond to requests and comments regarding restroom access for transgender employees. Employers also should be mindful that different jurisdictions may have different requirements. Accordingly, it always is recommended that nonprofit employers consult with legal counsel about complying with anti-discrimination requirements for transgender employees.