On April 4, 2017, the Seventh Circuit Court of Appeals became the first federal appellate court to hold that discrimination on the basis of sexual orientation is a form of sex discrimination prohibited under Title VII in Kimberly Hively v. Ivy Tech Community College of Indiana. The ruling creates a circuit split that is not only ripe for Supreme Court review, but may affect the rights of both employees and employers under Title VII.

History of Title VII and discrimination on the basis of sexual orientation

Prior to Hively, the Seventh Circuit had held on multiple occasions that Title VII did not apply to discrimination on the basis of sexual orientation. The basis for these holdings was the idea that Title VII’s prohibition against sex discrimination “implies that it is unlawful to discriminate against women because they are women and against men because they are men … Congress had nothing more than the traditional notion of ‘sex’ in mind when it voted to outlaw sex discrimination.” This holding was well-established law in not only the Seventh Circuit, but in almost every circuit in the country. Indeed, a panel of the Eleventh Circuit, recognizing that it was bound by Fifth Circuit precedent, reaffirmed on March 10, 2017, that it could not recognize sexual orientation discrimination claims under Title VII. More recently, on March 27, 2017, the Second Circuit held that one panel lacked the power to reconsider precedent holding that sexual orientation discrimination claims were not cognizable under Title VII.

The Seventh Circuit’s holding

In Hively, the plaintiff, who is openly lesbian, began teaching as a part-time, adjunct professor at Ivy Tech Community College. Between 2009 and 2014, the plaintiff applied for at least six full-time positions, but was not hired for any of those positions. Then, in 2014, her part-time contract was not renewed. Believing that these actions were the result of her sexual orientation, the plaintiff filed suit in the district court alleging discrimination on the basis of sex under Title VII. However, the district court dismissed her action on the basis that sexual orientation is not a protected class under Title VII. The Seventh Circuit affirmed the district court’s decision based on Seventh Circuit and sister circuit precedent, but additionally noted that such an interpretation creates “bizarre results” in “a paradoxical legal landscape in which a person can be married on Saturday and then fired on Monday for just that act.”

Subsequently, the full panel of the Seventh Circuit reversed, reasoning that “it is actually impossible to discriminate on the basis of sexual orientation without discriminating on the basis of sex.” In addition, the court rejected the commonly used, previously successful argument that Congress had frequently considered amending Title VII to add the words “sexual orientation” to its list, but had actively chosen not do so, stating that “it is simply too difficult to draw a reliance inference from these truncated legislative initiatives to rest our opinion on them. The goalposts have been moving over the years, as the Supreme Court has shed more light on the scope of the language that already is in the statute: no sex discrimination.”

The future of Title VII

The Seventh Circuit’s decision in Hively may signal the beginning of shifting legal interpretation with respect to the meaning of “discrimination on the basis of sex.” As circuits have heavily relied on prior existing precedent to decline to include sexual orientation as a form of sex discrimination under Title VII, the Seventh Circuit’s new interpretation may allow other circuits to choose to interpret Title VII’s prohibition on sex discrimination as including sexual orientation.

More broadly, the currently competing interpretations of Title VII created by Hively may become a case to be heard by the Supreme Court, a currently uncharted territory pending the nomination of Judge Gorsuch. Regardless, employers should be prepared to adapt to the changing landscape of Title VII with respect to their policies and procedures, and ensure that they are complying with its mandates.