Advances for LGBT employees in 2014

In a year dominated by federal courts invalidating an exponential number of state gay marriage bans - and the resulting speculation about the U.S. Supreme Court taking up the issue - there were equally significant developments in employment laws affecting the lesbian, gay, bisexual and transgender community.

Executive Order 13,672

The Employment Non-Discrimination Act (ENDA), which would amend Title VII to include sexual orientation and gender identity as a protected class, has been stalled in Congress since 1996. Faced with this inaction, President Barack Obama issued an executive order making it illegal for federal contractors to fire or harass their employees based on sexual orientation or gender identity.

In the California bubble - where employment discrimination on the basis of sexual orientation and gender identity have been banned since 1992 and 2003 respectively, it is easy to overlook the impact this order will have nationwide. However, California is only one of 21 states and the District of Columbia that prohibit sexual orientation discrimination in the workplace (with even fewer states protecting transgender individuals). One might assume that, even in the majority of states without such protections in place, most large employers have already voluntarily adopted nondiscriminatory policies covering LGBT employees. But a Human Rights Campaign's survey of Fortune 500 companies reveals that 11 percent still do not include sexual orientation in their nondiscrimination policies, and 34 percent fail to protect transgender employees.

Obama's July 21 executive order affects 24,000 companies employing roughly 28 million workers, or about one-fifth of the nation's workforce. Taken together with the fact that a majority of federal contractor jobs are located in states without laws prohibiting sexual orientation or gender identity discrimination, a substantial number of LGBT employees were afforded protections with the stroke of the president's pen. Federal contractors should breath easier after the final rule issued by the Office of Federal Contract Compliance Programs (OFCCP) Dec. 3, 2013, clarified that employers will not be required to include sexual orientation and gender identify in affirmative action plans or in EEO-1 reporting obligations.

EEOC Enforcement

The Equal Employment Opportunity Commission's Strategic Enforcement Plan lists "coverage of lesbian, gay, bisexual and transgender individuals under Title VII's sex discrimination provisions, as they may apply" as an enforcement priority for Fiscal Year 2013-2016. In January 2013, the EEOC began to track information on allegations of sexual orientation and gender identity discrimination.

The EEOC has advised its investigators and attorneys that lesbian, gay, and bisexual individuals may bring valid Title VII sex discrimination claims, and that the EEOC will accept charges alleging sexual orientation-related discrimination. The agency's rationale for this expanded reading of Title VII is that sexual orientation discrimination is based on sex-stereotypes that men should only be attracted to women and vice versa.

The EEOC's commitment to these initiatives was recently demonstrated when it filed two first-of-their kind lawsuits on behalf of transgender employees. In EEOC v. Lakeland Eye Clinic, the EEOC sued a Florida-based eye clinic that fired an employee who announced that she was transgender and began to present (i.e., dress) as a woman. In EEOC v. R.G. & G.R. Harris Funeral Homes Inc., the EEOC sued on behalf of a funeral director who informed her employer she was undergoing gender transition and would start to present as a woman. The employer responded by firing her and telling her that what she was "proposing to do" was unacceptable. Previously, EEOC guidance and case law permitted enforcement of the employer's sex-specific dress and grooming codes that caused transgender employees to be disciplined and discharged.

Administration Implementation of Windsor

The 2013 Supreme Court decision in U.S. v. Windsor invalidated part of the Defense of Marriage Act which prohibited federal recognition of same-sex marriages. 570 U.S. 12 (2013). After the issuance of Windsor, Obama directed Attorney General Eric Holder to conduct a review of every federal law, rule, policy and practice in which marital status was a relevant consideration to ensure that same-sex married couples received equal treatment by the federal government. Since Holder's report on the implementation of Windsor was issued June 20, almost all federal agencies have since issued new rules or guidance that that recognize marriages as valid based on the law of the jurisdiction where the marriage took place (termed the "place of celebration"), regardless of where the couple resides.

The effects of Windsor will be felt by practitioners of various specialized fields of law: Same-sex married couples can file joint tax returns, sponsor marriage-based immigration petitions, and receive spouse social security death benefits. Also, the Department of Justice will also take the position in legal proceedings that same-sex married couples may decline to give testimony that may violate marital privilege, even in states that do not recognize such marriages.

Of note to employment law practitioners is the Department of Labor's rulemaking on the Family Medical Leave Act, providing that an employee is eligible for leave to care for a same-sex spouse regardless of the employee's state of residence. Existing rules allow for leave to care for a same-sex spouse only where the employee's state of residence recognizes the marriage. This change is likely to lead to a spate of litigation as private employers in conservative states, facing the issue of same-sex marriage for the first time, could have a knee jerk reaction that they are not obligated to provide leave while their state's gay marriage ban stands.

Given these developments, employers - especially those in in states without anti-discrimination laws covering LGBT employees - should conduct review and update policies that might be affected by the changes discussed above, including those addressing equal employment opportunity, family and medical leave, and bereavement leave.