On June 15, 2020, in a 6-3 decision, the United States Supreme Court made clear that employers may not discriminate against employees on the basis of sexual orientation or gender identity.  Specifically, the Court held that Title VII of the Civil Rights Act’s prohibition against discrimination on the basis of “sex” includes discrimination on the basis of sexual orientation and gender identity.  Bostock v. Clayton County, No. 17-1618, 590 U.S. __ (2020).

The Court’s decision resolves the following three consolidated cases where an employer terminated an employee because of their sexual orientation or gender identity: Bostock; Altitude Express v. Zarda; and R.G. & G.R. Harris Funeral Homes, Inc. v. EEOC.  Justice Neil Gorsuch wrote for the majority, holding that “sex” in Title VII includes sexual orientation and gender identity because “it is impossible to discriminate against a person for being homosexual or transgender without discriminating against that individual based on sex.”  Many lower courts had disagreed, finding that “sex” under Title VII was limited to biological gender.

To illustrate its reasoning, the Court posed two hypothetical scenarios:

• A heterosexual employee and homosexual employee both bring their spouses to a holiday party for their employer that has a policy of firing any employee known to be homosexual. If the employer fires the homosexual employee solely because she is attracted to women, the employer intentionally discriminates against her because of her sex, even though the employer’s intention was to discriminate solely on the basis of sexual orientation.
• The same reasoning holds true with respect to gender identity. The Court explained that “[a]n employer who fires a transgender person who identified as a male at birth but now identifies as a female . . . penalizes a person identified as male at birth for traits or actions that it tolerates in an employee identified as a female at birth.”  Indeed, this constitutes sex discrimination under Title VII because the employee’s sex “plays an unmistakable and impermissible role in the discharge decision.”

Under applicable state law, New York and New Jersey employers have long been prohibited from discriminating against employees in any aspect of employment based on an employee’s sexual orientation and/or gender identity.  However, the decision will directly impact employers in roughly half of the states across the country with no state law workplace protections based on an employee’s sexual orientation and/or gender identity.  It remains to be seen whether this decision will affect other federal laws that discriminate based on sexual orientation, such as in housing and healthcare.