On July 2, Governor Jack Markell signed legislation prohibiting sexual orientation discrimination in Delaware. Many employers already have policies in employee handbooks prohibiting discrimination based upon sexual orientation. Given the change in this critical employment law, all employers in the State should review their policies and procedures to ensure that their handbooks and employment practices comply with these new prohibitions on sexual orientation discrimination.

Among other things, the law amends Delaware's Discrimination in Employment Act so as to prohibit discrimination based on sexual orientation in employment. Under the new law, employers may not discriminate based on sexual orientation with respect to compensation, terms, conditions, or privileges of employment.

Under the law, which is effective immediately, the term "sexual orientation" is defined to include heterosexuality, homosexuality, and bisexuality. The new law does not provide additional protection to an individual based on transgendered status.

The law imposes no affirmative obligation upon employers to recruit or hire job candidates based on their sexual orientation. Nor does it require employers to extend employee benefits to employees' same-sex partners, even if employers give benefits to employees' marital spouses.

Religious organizations and associations are exempt from the new law even if those organizations receive State government funding. This exemption does not apply "where the duties of the employment or employment opportunity pertain solely to activities of the organization that generate unrelated business taxable income subject to taxation under § 511(a) of the Internal Revenue Code of 1986." The law does not affect federal antidiscrimination statutes, such as Title VII, which do not prohibit sexual-orientation discrimination.

In addition to the prohibitions on discrimination in employment, the new law prohibits discrimination based on sexual orientation with respect to public accommodations, insurance, and public works contracts. For instance, under the new law, places of public accommodation cannot withhold or refuse to provide accommodations, facilities, advantages, or privileges from people based on sexual orientation.