United States: Emergence Of Transgender Status Issues In Workplace Raises Compliance Questions For Employers

Last Updated: May 26 2015
Article by Jessica R. Perry and Daniel J. Corbett

Transgender issues have been grabbing headlines in recent months—perhaps most notably with Bruce Jenner's televised announcement about his gender transition. Beyond the bright lights of pop culture, a wave of litigation and legislation is causing employers to pay closer attention to transgender discrimination and related issues. As we noted in August of last year, there is an increasing trend toward protecting gender identity and transgender status. This post provides an update and a high-level overview of the landscape in this emerging area and offers some tips for employers to minimize risk.

Notably, there has been a recent spate of lawsuits demonstrating the need for employers to become more proactive and educated about transgender legal obligations in the workplace. For instance, the EEOC recently settled one of its first transgender discrimination suits under Title VII. Pursuant to an April 9 settlement with a Florida eye clinic, the clinic agreed to make two $75,000 payments to the former employee, to adopt and implement a gender and transgender discrimination policy, and to train employees on it. The settlement requires the clinic to establish a policy that prohibits it from making employment decisions based on whether an employee is transitioning gender or if the person does not fit into a manager's opinion of gender/sexual orientation.

The EEOC also scored a victory last month when a Michigan federal judge refused to dismiss a complaint brought by a male funeral home director who was fired after informing his employer that he intended to live and dress as a woman full-time, including at work.

In March, Saks Fifth Avenue settled a high-profile transgender discrimination lawsuit in Texas federal court. The case was brought by a former transgender saleswoman. The allegations included co-workers' alleged refusal to use feminine pronouns, as well as being denied access to the women's restrooms at work and being encouraged to dress and act more masculine. The case received national attention after Saks argued in a motion to dismiss that transgender individuals are not covered by federal discrimination laws. The company later abandoned this argument and the case settled.

Perhaps in response to these seemingly favorable outcomes for plaintiffs, additional transgender lawsuits have been appearing in other states as well, including California and Louisiana. A California case, filed against Barnes & Noble on May 6, is still in its early stages in Orange County Superior Court. In that case, a former employee filed suit claiming discrimination and harassment after allegedly being told by her supervisor that her appearance was upsetting customers and to "think of the children."

On the legislative side, efforts underway are more divided. On March 12, Gov. Gary Herbert of Utah signed S.B. 296 into law, making Utah the 19th state to prohibit discrimination in employment based on gender identity. The new law modifies provisions of state antidiscrimination law, including: (1) adding sexual orientation and gender identity as prohibited bases for discrimination; and (2) requiring employers to adopt policies that permit employees to dress and utilize sex-specific facilities consistent with their gender identity. The new law makes it illegal to make employment decisions, such as hiring and firing, based on sexual orientation or gender identity or expression. However, employers are not prohibited from adopting reasonable dress and grooming policies or from adopting reasonable rules regarding sex-specific facilities, provided the rules afford reasonable accommodations based on the gender identities for all employees. The new law will go into effect in July 2015.

A bill filed in the Florida legislature on February 5, aims to invalidate local transgender nondiscrimination ordinances across the state. H.B. 583 would reinstate restrictions on single-sex public facilities to persons of that biological sex. If passed, the law could potentially invalidate a number of transgender protection laws throughout Florida. Miami-Dade County recently became the 21st municipality in Florida to adopt legal protections for individuals based on gender identity and expression. Other municipalities to extend similar protections include Broward and Palm Beach counties, and Gainesville, Key West, Tampa, and Miami Beach. As of this writing, the bill was still in the Judiciary Committee.

As the law in this area continues to develop, here are some general tips for employers looking to be proactive and minimize risk:

  • If you have not already, consider re-writing nondiscrimination and anti-harassment policies to include transgender status, as well as gender identity, expectations, or stereotypes.
  • Allow employees access to restrooms consistent with their gender identity. If possible, add a gender-neutral option or a single-occupant restroom. OSHA and the National Center for Transgender Equality have recently formed a partnership to distribute information to ensure transgender employees have safe and adequate access to restrooms at work.
  • Reexamine gender-based dress codes and make any necessary adjustments.
  • Examine health insurance policies to determine whether procedures related to gender transition are covered.
  • Consider the creation of a gender transition policy/procedure that will allow the employee and someone from the company (e.g., HR) to discuss the timing of any surgery, whether time off will be needed, what name the employee will want to use, whether the employee wants co-workers to know about the change, and any other accommodations or requests the employee might have.
  • Keep tabs on local laws. In addition to the 19 states (and the District of Columbia) that have laws protecting transgender status, there are countless municipal and local laws of which employers should be aware.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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