Alerts and Updates

The Court of Appeals for the Sixth Circuit held in Equal Employment Opportunity Commission v. R.G. &. G.R. Harris Funeral Homes, Inc. that Title VII prohibits employers from discriminating on the basis of transgender and gender transitioning statuses.

Momentum continues to build behind the expansion of protections because of “sex” under Title VII of the Civil Rights Act of 1964. Less than two weeks after the en banc U.S. Court of Appeals for the Second Circuit issued its opinion in Zarda v. Altitude Express, Inc., holding that Title VII prohibits sexual orientation discrimination, the Court of Appeals for the Sixth Circuit (with jurisdiction over Kentucky, Michigan, Ohio and Tennessee) held in Equal Employment Opportunity Commission v. R.G. &. G.R. Harris Funeral Homes, Inc. that Title VII prohibits employers from discriminating on the basis of transgender and gender transitioning statuses.

At present, federal courts in Connecticut, Illinois, Indiana, Kentucky, Michigan, New York, Ohio, Tennessee, Vermont and Wisconsin recognize expanded protections because of “sex” under Title VII. In contrast, federal courts in Alabama, Florida and Georgia do not recognize such protections. This split of authority likely will remain, and may even deepen if other circuit courts address these issues, until the Supreme Court resolves the matter.

Case Background

Aimee Stephens, a transgender woman, was born biologically male and lived and presented as a man while employed as a funeral director at R.G. & G.R. Harris Funeral Homes, Inc. Stephens was fired by the funeral home owner and operator, Thomas Rost, soon after Stephens told Rost that she intended to transition from male to female and would present herself and dress as a woman while at work in the time leading up to her transition.

Rost attempted to defend himself by taking the position that he would be violating his religious beliefs “if [he] were to permit one of [the funeral home’s] funeral directors to deny their sex while acting as a representative of [the] organization.” Rost also stated that he believed he would be “complicit” if he authorized or paid for “a male funeral director to wear the uniform for female funeral directors.”

Stephens filed a complaint with the EEOC, which adopted the case and filed suit. The lawsuit alleged that Stephens’ employment was unlawfully terminated in violation of Title VII because of her refusal to conform to sex-based stereotypes and her transgender or transitioning status.

The Court’s Analysis

As to the EEOC’s gender stereotype discrimination theory, the Sixth Circuit held that Rost’s termination of Stephens fell “squarely within the ambit of sex-based discrimination” forbidden by precedent. Additionally, because the funeral home did not establish a nondiscriminatory basis for the termination (Rost conceded that Stephens’s performance played no role in his decision), the court granted summary judgment outright to the EEOC on the gender stereotype discrimination claim.

The court then held that transgender and transitioning status discrimination violated Title VII for two reasons:

  • “[I]t is analytically impossible to fire an employee based on that employee’s status as a transgender person without being motivated, at least in part, by the employee’s sex”; and
  • “[D]iscrimination against transgender persons necessarily implicates Title VII’s proscriptions against sex stereotyping. … Thus, an employer cannot discriminate on the basis of transgender status without imposing its stereotypical notions of how sexual organs and gender identity ought to align. There is no way to disaggregate discrimination on the basis of transgender status from discrimination on the basis of gender non-conformity[.]”

In so holding, the court relied on the Second Circuit’s decision in Zarda as well as Hively v. Ivy Tech Community College of Indiana, the Seventh Circuit’s 2017 decision extending Title VII protections to sexual orientation.

The Sixth Circuit also rejected the funeral home’s defenses based on its sincerely held religious beliefs. The court rejected any reliance on Title VII’s “ministerial exception,” which precludes application of employment discrimination laws to employment claims between a religious institution and its ministers, because the funeral home was not a religious institution and Stephens was not a ministerial employee.

The court also rebuffed the funeral home’s reliance on the Religious Freedom Restoration Act (RFRA), which precludes the government from “substantially burden[ing] a person’s exercise of religion” under certain circumstances unless the government can make the requisite showings. The court rejected the funeral home’s argument that continuing to employ Stephens would substantially burden Rost’s ability to serve mourners. The court explained that “a religious claimant cannot rely on customers’ presumed biases to establish” a substantial burden under RFRA. Moreover, the court held that “bare compliance with Title VII—without actually assisting or facilitating Stephens’s transition efforts—does not amount to an endorsement of Stephens’s views” and a substantial burden on religious practice. The Sixth Circuit also rejected the argument that the EEOC lacked a “compelling government interest” in taking action because “[f]ailing to enforce Title VII against the Funeral Home means the EEOC would be allowing a particular person—Stephens—to suffer discrimination, and such an outcome is directly contrary to the EEOC’s compelling interest in combating discrimination in the workforce.” Finally, the court ruled that enforcing Title VII was the “least restrictive way to further [the] EEOC’s interest in eradicating discrimination based on sex stereotypes from the workplace.”

What This Means for Employers

R.G. &. G.R. Harris Funeral Homes, Inc. is further evidence that recent decisions extending Title VII protections based on sex are gaining traction. The same considerations addressed in our recent Alert about Zarda apply with equal force in light of the Sixth Circuit’s decision. At a minimum, employers covered by this ruling (those operating in Kentucky, Michigan, Ohio and Tennessee) immediately need to ensure that transgender and transitioning employees are not subject to differential and discriminatory treatment because of such status.

Three additional points are worth noting:

  • The EEOC, even during the Trump administration, is investigating and litigating Title VII sexual orientation/transgender cases at the administrative, district court and appellate court levels. In light of the EEOC’s enforcement priorities, employers that receive notice of a charge of discrimination involving sexual orientation/transgender discrimination claims should consult counsel to develop a defense strategy from the earliest moment.
  • Generally, employers may be very limited in justifying adverse actions against employees based on concerns about their customer biases. Indeed, the Sixth Circuit rejected the funeral home’s RFRA defense because “a religious claimant cannot rely on customers’ presumed biases to establish a substantial burden” to their compliance with anti-discrimination laws.
  • As the courts extend protections to individuals who are in the process of transitioning, employers should review their reasonable accommodation polices and other employee health and welfare benefits to assess whether any modifications or clarifications are necessary to ensure legal compliance.