The Sixth Circuit decision seems overall correct, although it contains some "woke dicta," too.
It's a strange case because there is no dispute that the Detroit-area funeral home chain did, indeed, openly discriminate against its employee, Aimee Stephens, because of her announced intention to begin transitioning from male to female.
In other words, this is not one of those cases in which the employer claims the employee was terminated for some legitimate, non-discriminatory reason. Aimee Stephens was terminated because of her planned transition. The funeral home doesn't dispute that.
Despite this seemingly dispositive fact, a federal district court judge granted summary judgment to the funeral home in 2016. The funeral home, which was represented by the Alliance Defending Freedom, successfully argued that it was protected from EEOC action by the Religious Freedom Restoration Act. The RFRA prohibits the federal government from significantly burdening a person's free exercise of religion unless it has a compelling interest in doing so and there are no less-burdensome alternatives.
The funeral home director is a devout Baptist who believes that the only sexes, created by God, are male and female in the traditional, biological sense. He believes that his funeral home is a ministry. And he believed that allowing Ms. Stephens to present as female would distract and upset his bereaved clients, and would also eventually force him, in conscience, to leave the business (his ministry). No one is disputing the sincerity of the director's beliefs in this regard, or the fact that they are faith-based.
The district court assumed that the EEOC had a compelling interest in enforcing the anti-discrimination laws but found that the director's religious beliefs would be significantly burdened by enforcement in this case and that there was a less-burdensome alternative for the EEOC to pursue. According to the district court, the EEOC could have allowed (or required) the funeral home to adopt a gender-neutral dress code, which would allow Ms. Stephens to dress the same way as her peers who present as male.
Needless to say, the EEOC appealed, and last week, the Sixth Circuit panel ruled decisively in the EEOC's favor. Here are the key points from the Sixth Circuit decision:
1-Gender identity discrimination is per se a form of "sex" discrimination prohibited by Title VII.
2-In addition, gender identity discrimination is a form of unlawful gender stereotyping, which is prohibited by Title VII. (The district court agreed on this point.)
3-The Religious Freedom Restoration Act does not shield the funeral home from EEOC enforcement action. (More on this in a minute.)
4-The district court will need to make a ruling on whether the funeral home is liable for sex discrimination for having a more generous clothing allowance for male than for female employees.
To me, the most interesting part of this case is the RFRA issue. The funeral home relied heavily on the 2014 U.S. Supreme Court decision in Burwell v. Hobby Lobby Stores, Inc. In that case, the Supreme Court ruled 5-4 that the employers -- closely held, for-profit corporations -- were exempt from the "contraceptive mandate" in the Affordable Care Act. The owners of the companies did not object to providing employee coverage for 16 contraceptives, but did object to providing coverage for four other contraceptives that prevented the fertilized ovum from implanting in the womb. The owners viewed these four contraceptives as being tantamount to abortion, a sin according to the owners' sincere religious beliefs.
The funeral home owner in our Sixth Circuit case argued that this same reasoning should apply to his sincere religious beliefs about the sexes. I was inclined to agree, but after reviewing Hobby Lobby again, I think the Sixth Circuit was correct in finding that Hobby Lobby didn't apply. In Hobby Lobby, the employers argued that providing coverage for the four contraceptives was actually going to require them to participate in sin. By contrast, letting Ms. Stephens keep her job didn't require the funeral home owner to participate in Ms. Stephens' transition -- only to tolerate it. "Live and let live," if you will. As the Sixth Circuit noted, the funeral home employed non-Christians and non-believers, and served non-Christian and non-believing clients. So, arguably, it's not much of a step for the funeral home to employ a transgender person, regardless of the owner's religious views about the immutable nature of biological men and women. Employment is not the same as "endorsement."
(It would be interesting to see the outcome if Ms. Stephens had asked for the funeral home to pay for her transition or surgery, either directly or through health insurance. That might have tipped the scales in favor of the funeral home.)
The other thing that hurt the funeral home's is that Hobby Lobby flat-out says that it does not apply to ordinary employment discrimination . . . at least, not if it's based on race. As Justice Samuel Alito wrote for the majority, "The Government has a compelling interest in providing an equal opportunity to participate in the workforce without regard to race, and prohibitions on racial discrimination are precisely tailored to achieve that critical goal." (Emphasis is mine.) The Sixth Circuit panel said that this same reasoning applies to sex discrimination under Title VII, which it has ruled includes discrimination based on gender identity.
(But does it really? Was there a reason Justice Alito kept saying "race discrimination" instead of making this disclaimer more general? I suspect he may have been pointedly omitting forms of employment discrimination that are more likely to become entangled with religious beliefs, including religious discrimination, and certain forms of sex discrimination.)
The Sixth Circuit also rejected the district court's proposed solution of a unisex dress code, noting that Ms. Stephens would probably be presenting as female in other ways (hair, makeup, mannerisms, accessories) even if she wore a suit jacket and pants to work.
Did the panel decision overreach in any way? I think so. Its extension of Justice Alito's disclaimer about race discrimination to cases of transgender discrimination may be a stretch. It also wasn't necessary to rule that transgender discrimination was by definition a form of "sex" discrimination, when the panel could have found in the EEOC's favor based solely on the gender stereotyping theory that has already been widely accepted by the courts.
The worst, though, was where the court dismissed the owner's sincere religious belief that continuing to employ Ms. Stephens would have amounted to an "endorsement" of her decision to transition. The court said, "[W]e conclude as a matter of law that [the owner] does not express 'support for the idea that sex is a changeable social construct rather than an immutable God-given gift' by continuing to hire Stephens . . . -- even if [the owner] sincerely believes otherwise."
Uh, isn't that between the owner and God? The court could have found in favor of the EEOC without substituting its own religious interpretations for those of the owner. In the immortal words of Judge Dennis Jacobs of the Second Circuit, this all struck me as "woke dicta."
The ADF press release on the Sixth Circuit decision, issued on the day of the decision, does not indicate whether the funeral home will continue to pursue the matter. The funeral home could seek review of the panel decision by all of the Sixth Circuit judges. Because of the RFRA/Hobby Lobby aspect, the case could end up at the Supreme Court.
Or the funeral home could decide to cut its losses, settle, and go home.
Whatever happens, we will keep you posted.