​In a decision released last week, the U.S. Equal Employment Opportunity Commission (“EEOC”) determined that discrimination based on gender identity, change of sex, or transgender status constitutes sex discrimination under Title VII of the Civil Rights Act of 1964 (“Title VII”).

This case was brought on behalf of Mia Macy, a former police detective, who claimed that she was denied a job at the Bureau of Alcohol, Tobacco, Firearms and Explosives (the “Bureau”) when she informed the Bureau that she was transitioning from male to female. According to Macy, she applied for the job while still presenting as a male and was told that she would receive the job barring any issues with her background check. However, a few days after informing the Bureau that she would be undergoing a sex change operation, she was told that the position had been cut due to federal budgetary constraints. Macy later learned from an EEO representative at the Bureau that the position had not been cut but instead someone else had been hired for the job.

Believing she had been denied the position for discriminatory reasons, Macy filed a formal EEO complaint with the Bureau alleging discrimination on the basis of sex, gender identity (transgender woman), and sex stereotyping. While the Bureau accepted her Complaint, it stated that only her claim “based on sex (female)” would be processed under Title VII and EEOC regulations. While it would investigate the claims based on gender identity and sex stereotyping, it would do so according to the Bureau’s own adjudication process. After some back and forth communications with the Bureau, Macy appealed to the EEOC. 

In the interest of resolving confusion over what constitutes “sex discrimination” under Title VII, the EEOC accepted her appeal. Ultimately, the EEOC determined that claims of discrimination based on transgender status also referred to as claims based on gender identity, are cognizable under Title VII’s sex discrimination prohibition.  Drawing from previous court decisions (including Smith v. City of Salem [1] and Barnes v. City of Cincinnati [2], two decisions from the Sixth Circuit, which governs Ohio), the EEOC explained that the statute’s protections encompass not only a person’s biological sex, but also gender, including the cultural and social aspects associated with masculinity and femininity. Therefore, the Bureau had erred by not processing Macy’s claims of gender identity and sex stereotyping under Title VII and EEOC regulations.

In making its determination, the EEOC relied heavily on Price Waterhouse v. Hopkins [3 , an important U.S. Supreme Court decision holding that Title VII forbids employers from taking gender into account when making employment decisions. In Price Waterhouse, an employer refused partnership to a female senior manager, in part, because she was not viewed as behaving in a sufficiently feminine manner. Just as Hopkins was discriminated against based on sex for failing to conform to stereotypical norms (“sex stereotyping”), so too was Macy discriminated against if she was denied a position due to the perception that her transgender status did not conform with gender stereotypes. The EEOC’s decision went on to clarify that gender-stereotyping is not itself a separate claim, but rather is one theory by which sex discrimination can be proven.

The Macy decision makes clear that intentional discrimination against a transgender individual based on their transgender status is sex discrimination and therefore violates Title VII. The decision is binding on all federal agencies and departments, and is likely to be afforded at least some deference by the federal courts. Therefore, employers in the public and private sectors should be cognizant that the EEOC has determined that transgender employees and job applicants are protected by Title VII. 

In light of this decision, employers should review their current policies to ensure they conform with Macy. For additional information regarding this decision and its potential impact on specific workplace practices, please contact the Ulmer & Berne Labor and Employment Team.