In a growing trend in employment law across the country, regulatory agencies are engaging in efforts to eliminate transgender discrimination. Employers should be aware of these developments and sensitive to issues that affect transgender employees.

EEOC Efforts to Protect Transgender Employees 

The Equal Employment Opportunity Commission (the “EEOC”) began focusing its agenda on transgender discrimination issues in 2012. In Macy v. Dep’t of Justice, EEOC Appeal No. 0120120821 (April 20, 2012), the EEOC ruled that employers who discriminate against employees on the basis of their transgender status violate Title VII. In April 2015, in Lusardi v. McHugh, EEOC Appeal No. 0120133395 (April 1, 2015), the agency ruled that denying employees use of the bathroom aligned with their gender identities and refusing to address transgender employees by their preferred gender pronouns constitute discrimination on the basis of sex, and thus also violate Title VII. Although both addressed employees of the federal government, these landmark rulings serve as the foundation of the EEOC’s plan to weed out transgender discrimination in the workplace.

The EEOC subsequently filed three lawsuits in three different states, two of which (in Florida and Minnesota) were settled. In April 2015, a Florida eye clinic paid a $150,000 settlement to a transitioning employee (i.e., an individual transitioning from one gender to another). In January 2016, the EEOC settled a case with wide-ranging implications for the treatment of transgender employees. Britney Austin, a transgender employee, was denied access to the bathroom consistent with her gender identity and purposefully addressed with the incorrect gender pronoun. Pursuant to the consent decree resolving the case, Deluxe Financial Services Corp. (“Deluxe”) must revise its equal employment opportunity policies to include a clear prohibition against discrimination based on an employee’s transgender status. Deluxe also must comply with requests to change an employee’s name and gender and cannot prevent an employee from using the bathroom aligned with the individual’s gender identity. Additionally, Deluxe will conduct annual training for all employees that must address the prohibition of discrimination on the basis of transgender status and gender identity. Deluxe also must submit annual reports to the EEOC for the next three years demonstrating its compliance with these requirements. Consent Decree, EEOC v. Deluxe Financial Services, Inc., 15-cv-2646(ADM/SER) (D. Minn. Jan. 20, 2016).

The EEOC shows no signs of stopping. In a press release following the settlement against Deluxe, acting District Director Elizabeth Cadle said, “EEOC considers protecting transgender, lesbian, gay, and bisexual employees to be a strategic enforcement priority. We will continue to assure that transgender employees receive the full benefit of federal anti-discrimination laws in all industries.”

New York City Promulgates Guidelines

The EEOC is not the only entity focusing on transgender discrimination. On December 21, 2015, the New York City Human Rights Commission (the “Commission”) issued strict guidelines prohibiting gender identity discrimination in the workplace. The guidelines mirror concerns of the EEOC, recognizing potential violations when an employer fails to use an employee’s preferred name or pronoun or refuses to allow employees to use the restrooms aligned with their gender identities. The Commission’s guidelines also prohibit sex stereotyping, imposing grooming standards based on gender, and providing discriminatory gender-based employee benefits. Further, employers are barred from considering gender when assessing accommodation requests (such as for gender reassignment surgery) and from engaging in harassment and retaliation based upon gender identity or expression. Violators face harsh financial penalties (up to $250,000) in addition to unlimited compensatory damages.

Employer Guidance

Given the increased scrutiny regarding the treatment of transgender employees, it is essential that employers familiarize themselves and their human resources professionals and managers with these developments. Below are several easy tips for employers to avoid being swept up in this relatively new and attractive area of litigation.

Use Preferred Pronouns

  • Use trans employees’ preferred gender pronoun.
  • On employment applications and similar documents, consider leaving a blank space to be filled in for the employee’s gender rather than providing only “male” and “female” options.
  • Note that some trans individuals prefer nontraditional pronouns, such as “they” or “ze.”
  • Update all internal records to reflect the employee’s self-identified gender.
  • Educate managers and co-workers to use an individual’s chosen pronoun.

Bathroom Facilities

  • Allow trans employees to use the restroom corresponding to their gender identities, unless all facilities are single-occupancy bathrooms.
  • Employers may not require trans employees to use single-occupancy restrooms, while preventing them from using the shared bathrooms corresponding to their gender identities.
  • Where available, employers should permit a trans employee to use a single-occupancy restroom if that is the employee’s expressed preference.

Employment Policies

  • Nondiscrimination policies must include gender identity in the list of protected categories.
  • Leave policies must reflect the needs of transgender employees, treating transgender employees’ requests for leave or accommodations as an employer would treat any other medical request, including leave requests to attend to medical needs associated with transition.
  • If a trans employee has adopted a new name, use the new name instead of the employee's birth name. Update employment records to reflect an individual’s identified gender and name.

Training and Education

  • Train human resources professionals regarding the complexities of transgender discrimination and how to properly address issues that may arise between or among employees.