Executive Summary: Whether Title VII of the Civil Rights Act of 1964 prohibits discrimination on the basis of sexual orientation, gender identity, transgender status and/or gender expression remains a heated debate in the courts and between government agencies. In the latest development, on October 4, 2017, Attorney General Jeffrey Sessions announced that under his interpretation of Title VII, gender identity and transgender status are not protected. The Justice Department made the same argument with respect to sexual orientation last week at oral argument before the Second Circuit in Zarda v. Altitude Express. This represents a significant departure from the position of the Obama Administration and the current position of the Equal Employment Opportunity Commission, both of which interpreted Title VII to prohibit such discrimination. It is clear that absent Congressional action, or a decision by the U.S. Supreme Court, the issue will continue to be intensely debated.

Background

Title VII prohibits, inter alia, discrimination and harassment “because of…sex.” Title VII does not, however, explicitly prohibit discrimination based on sexual orientation, gender identity, transgender status or gender expression. Despite opportunities to amend the language of Title VII, Congress has not done so. In addition, until recently, Circuit Courts of Appeal unanimously interpreted the term “sex” to mean biological sex, and held Title VII does not prohibit discrimination based on sexual orientation.

This began to change under the Obama Administration. On December 15, 2014, former Attorney General Eric Holder issued a memorandum in which he concluded that “sex” is not limited to biological sex, and that Title VII does prohibit gender identity discrimination. Exactly seven months later, on July 15, 2015, the EEOC held in Baldwin v. Foxx that the term “sex” in Title VII also includes a prohibition against sexual orientation discrimination, albeit in the context of the federal sector. This set off a string of litigation asking the courts to more clearly define the meaning of “sex” in both Title VII and, in the case of students, Title IX of the Education Amendments Act of 1972. Earlier this year, in Hively v. Ivy Tech Comm. College and Whitaker v. Kenosha Unified Sch. Dist. No. 1 Bd. of Educ., the Seventh Circuit became the first to hold that “sex” encompasses sexual orientation and gender identity/transgender status under Title VII and Title IX, respectively.

However, the Trump Administration has taken an increasingly narrow view of the issue. Shortly after President Trump’s inauguration, in February 2017, the Departments of Justice and Education jointly issued a memorandum undoing Obama-era guidance requiring all public schools to allow transgender students to use the bathroom corresponding to their gender identity, as opposed to biological sex, pursuant to Title IX. In July 2017, President Trump tweeted his transgender military ban. Later that month, the Justice Department filed an unsolicited amicus brief with the Second Circuit in Zarda v. Altitude Express. In that brief, the Justice Department encouraged the Second Circuit to ignore the position of the EEOC that Title VII protects sexual orientation, and uphold its prior decision in Simonton v. Ruynon that the plain language of Title VII does not prohibit such discrimination. The Department of Justice argued that same position last week at oral argument in Zarda.

In his latest move, Attorney General Sessions announced on October 4, 2017, in a memorandum to all Department Heads of the U.S. government, that former Attorney General Holder’s December 15, 2014 memorandum was rescinded. Attorney General Sessions instructed that “Title VII does not prohibit discrimination based on gender identity per se.” He opined that “the Department of Justice must interpret Title VII as written by Congress.” He further argued that, while other statutes do, Title VII does not expressly prohibit gender identity discrimination, and Congress has chosen not to amend the language. Therefore, according to Attorney General Sessions, Congress did not ever and does not now intend for gender identity discrimination to be prohibited by Title VII. The memorandum summarizes the Trump Administration’s position as follows:

…Title VII’s prohibition on sex discrimination encompasses discrimination between men and women but does not encompass discrimination based on gender identity per se, including transgender status. Therefore, as of this memorandum…the Department of Justice will take that position in all pending and future matters….

Attorney General Sessions closed the memorandum by stating that it should not be read to condone discrimination against transgender individuals. He also affirmed the Justice Department’s commitment to prosecute hate crimes against transgender individuals pursuant to the Matthew Shepard and James Byrd Jr. Hate Crimes Prevention Act and the Violence Against Women Reauthorization Act.

Bottom Line

It is not clear how the Justice Department’s position on the appropriate interpretation of Title VII regarding LGBTQ protections will influence the courts. Ultimately, it will still take an act of Congress or a decision from the U.S. Supreme Court to define the meaning of “sex” in Title VII and Title IX with any certainty. As we await further guidance, it is important for employers to develop and maintain anti-discrimination and anti-harassment policies consistent with applicable state and local laws. While the current inconsistency in laws across the country will continue to create challenges for multi-state employers, the conservative approach is to maintain national policies that prohibit discrimination not only against the traditional protected classes, but also based on sexual orientation, gender identity, gender expression, and transgender status. Employers of all sizes are encouraged provide comprehensive complaint and investigation policies and procedures, as well as training to ensure these policies are utilized and appropriately enforced.