New ordinance has a number of provisions that may impact employers doing business in the city.

On May 9, Philadelphia Mayor Michael Nutter signed into law a bill that steps up the city's efforts to become what the mayor has described as the "most LGBT-friendly city in the world."[1] Bill No. 130224—the "LGBT Equality Bill"—passed on April 25 with a 14-3 vote and has a number of provisions that may impact employers doing business in Philadelphia.

With the passage of this law, Philadelphia joins an increasing number of states and municipalities that are strengthening legal protections for lesbian, gay, bisexual, and transgendered (LGBT) individuals. Already this year, Delaware and Rhode Island have enacted same-sex marriage laws, and Colorado has adopted civil unions.[2] Moreover, just a few weeks ago, a bipartisan coalition of U.S. senators and congressmembers reintroduced the Employment Non-Discrimination Act (ENDA), a federal law that would ban discrimination on the basis of sexual orientation and gender identity. ENDA has percolated in Congress for years but gained traction recently, and many predict it will pass this year.

The Philadelphia "LGBT Equality Bill"

Specifically, the new Philadelphia law does the following:

  • Amends the city code's general definition of "family" to include those who are not legally married but who have formed a "life partnership," which the bill defines as a same-gender couple that lives together and has "agree[d] to share the common necessities of life and to be responsible for each other's common welfare."
  • Prohibits employers from "fail[ing] to permit employees to dress consistently in accordance with their gender identity" and from "fail[ing], upon the request of an individual, to change that individual's name or gender on any forms or records" to the extent permitted by law.
  • Provides tax credits to employers that make health benefits available to its employees' life partners and their children.
  • Provides tax credits to employers that make health coverage available for the medical costs associated with undergoing a gender transition.

Employers should note that these tax incentives are meant for employers that do not already offer such benefits. Employers do not qualify for a credit if they offered similar benefits in the three tax years immediately prior to the application for credit.

What Employers Can Do to Address These Changes

As a general matter, private employers are ahead of this legislative tide toward employment protections for individuals in the LGBT community. Reports estimate that approximately 88% of Fortune 500 companies include sexual orientation in their nondiscrimination policies, and 57% protect gender identity. Nevertheless, employers doing business in Philadelphia should make certain that both sexual orientation and gender identity are included in their antidiscrimination policies and should include sexual orientation, gender identity, and gender stereotyping in their antiharassment training programs.

Likewise, employers around the country—even those outside of jurisdictions that explicitly protect sexual orientation and gender identity—may want to consider making these changes since the Equal Employment Opportunity Commission is now taking the position that discrimination against LGBT employees can be a form of "gender stereotyping" in violation of Title VII of the Civil Rights Act of 1964. See Macy v. Holder, No. 0120120821, 2012 WL 1435995 (E.E.O.C. Apr. 20, 2012) (discrimination against a transgender applicant falls within the scope of Title VII's prohibition of unlawful gender stereotyping).

Finally, notwithstanding that many private employers already protect against discrimination on the basis of gender identity, employers are encouraged to think carefully through issues relating to the protection of transgendered individuals.  A 2011 survey published by the National Center for Transgender Equality found that 47% of study participants reported experiencing an adverse job outcome—such as being fired, not hired, or denied a promotion—as a result of being transgender or as a result of gender nonconformity, and 50% claimed to have been harassed at work.