Seyfarth Synopsis: The passage of “Bathroom” or “Religious Freedom” bills raises issues for employers operating in impacted states. Employers in these states may wish to consider taking proactive and affirmative steps in the wake of these laws.

The belief of many pundits that the issue of LGBT rights was settled following the Supreme Court’s June, 2015 same-sex marriage ruling, has proved false. Indeed, in the nine months since the Supreme Court’s ruling nearly 200 bills have been introduced in state legislatures that limit LGBT rights. Recently, two of these bills have been signed into law, one in North Carolina and one in Mississippi. These bills have far reaching implications for employers, both in these states and nationwide, as more states look to enact copycat bills.

In a special one-day session on March 23, 2016, the North Carolina legislature proposed, drafted, passed, and enacted the Public Facilities Privacy and Security Act. The Act directly restricts restroom and locker room usage in public facilities to individuals based on the sex listed on that individual’s birth certificate. In addition, the Act provides that no city or municipality in North Carolina may enact any ordinance or regulation that would prohibit discrimination in employment or public accommodation on the basis of sexual orientation or gender identity. The Act further expressly repeals all local anti-discrimination ordinances that extended protection on the basis of gender identity or sexual orientation. The Act thus invalidated Charlotte’s discrimination ordinance, an ordinance which previously covered places of public accommodation rather than employment generally. The ACLU has already filed a suit challenging North Carolina’s statute, including a Title IX employment claim against the University of North Carolina. The Attorney General of North Carolina has stated he will not defend the Act as he considers it unconstitutional.

On April 4, 2016, the state of Mississippi enacted an even more restrictive law, titled the “Protecting Freedom of Conscience from Government Discrimination Act.” The Mississippi Act states that it seeks to protect the “religious beliefs” that same-sex marriage is impermissible and that gender is immutable and determined at birth. To effectuate this goal, the Mississippi Act protects employment decisions whose effect is to discriminate against LGBT individuals. In addition, the Act provides a cause of action to any person against any “third party” that attempts to enforce a rule of the state, or any division thereof, that would grant protection on the basis of sexual orientation or gender identity.

Importantly, prior to these bills being passed, neither Mississippi nor North Carolina extended anti-discrimination protections to LGBT individuals. Indeed, it remains the case that state anti-discrimination laws cover LGBT individuals in only 20 states and the District of Columbia. Nevertheless, the decision to expressly exclude LGBT individuals from the law is sure to encourage and even incentivize discrimination against members of the LGBT community.

In addition, the express state attempts to limit the protections of the LGBT community, are in sharp contrast to the efforts by the federal government to interpret existing anti-discrimination laws as extending protections on the basis of gender identity and sexual orientation. Indeed, in previous blogs we have detailed the positions of the EEOC and the Department of Education that respectively Titles VII and IX, prohibit discrimination on the basis of both gender identity and sexual orientation. In addition, OSHA has issued employer guidelines providing that employers are to provide restroom accommodations based upon gender identity. Similarly, the Department of Health and Human Services is drafting forthcoming regulations under the Affordable Care Act barring transgender discrimination in healthcare plans by entities that receive federal funds.