In a landmark ruling on July 15, 2015 in _____ [name of charging party kept secret] v. Foxx, EEOC Appeal No. 2012-24738–FAA-03 (July 15, 2015), the U.S. Equal Employment Opportunity Commission (“EEOC’) held for the first time that Title VII extends to claims of employment discrimination based on sexual orientation. Specifically, the EEOC determined that sexual orientation discrimination is per se sex discrimination, stating that: “We …conclude that allegations of discrimination on the basis of sexual orientation necessarily state a claim of discrimination on the basis of sex.” Foxx at 14.

While not surprising, the EEOC’s action is nothing short of controversial. It opined on a legal issue where the relevant statute and case law have offered an opposite conclusion. Critics no doubt will complain that the ruling manifests an activist agenda by the Commission in seeking to regulate through enforcement litigation.

Background

While the EEOC has yet to rule on the merits of the sexual orientation discrimination alleged in the Charge, its ruling is significant because it forcefully articulates an expansive view of Title VII that protects employees (both homosexual and heterosexual) from workplace discrimination, and relies on existing Title VII authority to do so. To date, federal courts have been largely reluctant to apply Title VII to claims of sexual orientation discrimination. In the administrative context, and if courts begin to adopt the reasoning of the EEOC, the ruling can significantly bolster the workplace protections of LGB (Lesbian, Gay and Bisexual) employees because federal law does not explicitly protect workers based on sexual orientation, and an overwhelming number of states do not include sexual orientation as a protected class in state anti-discrimination statutes.

EEOC Administrative Decision

Complainant in the case is a temporary worker for the Federal Aviation Agency (the “FAA”). He alleges that he was not selected for a permanent position at the FAA because he is gay. He further alleges that his supervisor repeatedly made homophobic comments about him. His name was kept confidential in the ruling.

Complainant’s EEO complaint was first evaluated through the FAA’s administrative EEO process, resulting in a Final Agency Decision from the EEOC denying the claim.  Complainant appealed, and the administrative decision addressed two issues, one relevant here:  (1) whether the charge was filed timely (the EEOC determined it was); and (2) whether the EEOC had jurisdiction over a claim of sexual orientation discrimination.

Traditionally, it has been excepted that Title VII does not extend to claims of sexual orientation discrimination as “sexual orientation” is not listed anywhere in the statute or its underlying legislative history.  However, the EEOC held differently here.  In holding that allegations of sexual orientation state an actionable claim under Title VII, the EEOC opined that while Title VII does not expressly list “sexual orientation” as a prohibited bases for discrimination, such discrimination was prohibited as a form of sex discrimination.

The EEOC had several bases for the decision. First, it noted that sexual orientation discrimination is sex-based because it is “premised on sex-based preferences, assumptions, expectations, stereotypes, or norms.”  Second, the EEOC opined that sexual orientation discrimination is sex-discrimination because it is “relational discrimination,” in that it involves treating a male employee who loves a man differently than a male employee who loves a woman, noting that courts regularly have applied this notion of relation discrimination in the race discrimination context. Third, the EEOC determined that discrimination based on sexual orientation was sex discrimination because it relies on gender stereotypes as to how “real men” and “real women” should behave, and in so doing seeks to “enforce heterosexuality defined gender norms.”

The EEOC also attempted to pre-empt the anticipated criticism of its expansive view of Title VII. It cites the Supreme Court’s decision in Oncale v. Sundowner Offshore Services, Inc., 523 U.S. 75 (1998), for the proposition that even if Congress did not intend Title VII to apply to this type of claim “statutory prohibitions often go beyond the principal evil [they were passed to combat] to cover reasonably comparable evils.” The EEOC goes on to note that it is no matter that since the dawn of the Clinton administration in the early 1990s, Congress has been debating the extension of federal anti-discrimination legislation to LGB individuals through the oft-proposed, but never passed, Employment Non-Discrimination Act (“ENDA”). The EEOC reasoned that this Congressional inaction may simply be the result of a recognition that Federal law already covers such claims. For support, the EEOC noted that the creation of a new protected class is not required to extend protections to individuals claiming sexual orientation discrimination, given that in its view claims of sexual orientation discrimination were simply claims of sex discrimination– a category expressly found in Title VII.

Implications

While the EEOC had been pushing toward this decision with administrative guidance addressing coverage under Title VII for LGB individuals, the significance of this new ruling from the EEOC cannot be understated. In ruling that employees may state a claim for sexual orientation discrimination as a form of “sex” discrimination under Title VII, the EEOC explicitly issued a holding that is contrary to certain federal court rulings interpreting Title VII.  Going forward, it is expected that the EEOC’s decision will result in an increased number of charges of discrimination filed and investigated based on sexual orientation. Moreover, given the EEOC’s key objectives in its Strategic Plan for 2012-2016 to ensure that members of the public understand their rights as well as the recourse available to them, employers can expect that the EEOC will take additional measures to educate future and potential claimants regarding this ruling.

While the EEOC’s ruling is not binding on federal courts, employers should be mindful that any allegations concerning sexual orientation discrimination – to the extent they can be interpreted to fall within the EEOC’s interpretation of “sex” – may expose them to liability, in addition to any protections that may exist under state or local laws. Certainly, the extensive rationale provided by the EEOC in this decision was clearly intended to serve as a road map for individuals hoping to press their claims of sexual orientation discrimination at the administrative level, and in Federal Court. The decision sets forth extensive references to case law that individuals can cite in support of this expansive view of Title VII. Whether, the line of argument advanced by the EEOC will be adopted by Federal Courts remains an open question. To date, Federal Courts have by an overwhelming margin been unwilling to allow such claims to survive the motion to dismiss stage. However, given that the EEOC’s decision comes just weeks after the seminal gay-marriage victory in Obergefell v Hodges, courts may be more open to revisiting this issue and more generally the question of using courts, not the legislature, to advance LGB rights.

Based on these developments, and this evolving area of law, employers must familiarize themselves with issues related to sexual orientation to avoid potential liability. Employers may wish consider the following:

  • Revisit Non-Discrimination Policies: Although the EEOC’s decision is not binding and there is no federal law which explicitly protects LGB employees from discrimination, employers should consider revising internal equal employment, non-discrimination and anti-harassment policies to include sexual orientation as protected categories.
  • Conduct Training: Employers should also make their managers and employees more sensitive to sexual orientation by incorporating these topics in EEO and harassment training programs.
  • Health Insurance and Benefits: Employers may also consider whether changes can be made to its health benefits to extend such coverage to same-sex spouses and/or domestic partners.

In sum, employers should increase their awareness of and sensitivity to issues related to sexual orientation in the workplace. Employers must be aware that LGB individuals may be protected under federal law in addition to relevant state or local laws, and that any allegations concerning sexual orientation discrimination require the same analysis, investigation and response as a traditional sex discrimination complaint. Finally, employers must evaluate their internal policies, practices and procedures with an eye toward sexual orientation issues to avoid potential complaints and liability.