That’s an eye-catcher of a title, isn’t it? As reported by the New York Times, Babeland, an adult toy store, became the first sex shop to become unionized. Workers at three New York City locations voted to be represented by the Retail, Wholesale and Department Store Union, one of the country’s largest retail unions.

Why did they choose to unionize? There were several typical reasons – wanting more transparency around hiring, promotions and discipline, as well as better ways of addressing workplace disputes and grievances.

But there were some other, less typical reasons. One is the customers. I’m sure you aren’t surprised to hear that Babeland’s customers can be, well, difficult. Some of them seem to believe that it’s ok to sexually harass sex shop workers. The workers want management to provide better training and support in dealing with these folks.

Another issue involves transgender or gender-nonconforming employees who do not feel respected by the company. One employee cited the company’s use of her legal – instead of preferred – name in the computer system.

So aside from the entertainment value of the title, this particular situation actually offers employers some interesting lessons. First, employers should keep in mind that Title VII’s prohibitions on sex discrimination and harassment in the workplace include inappropriate conduct by third parties against employees. It is the employer’s obligation to protect its workers from customer harassment.

Another lesson involves the transgender issue. Unless you’ve been living in a cave, you know that this is a very hot topic right now. The Equal Employment Opportunity Commission is aggressively taking the position that discrimination because of gender identity is sex discrimination under Title VII, and has filed several lawsuits against employers on behalf of transgender employees. The EEOC and the Occupational Safety and Health Administration have each released guidance on bathroom use for transgender workers. North Carolina and the federal government have filed dueling lawsuits over North Carolina’s transgender bathroom use law. Multiple states have sued the U.S. Department of Education over its directive to allow transgender students to use the bathroom consistent with their gender identity.

What this means for wise employers is to be prepared to address transgender issues in the workplace. Open communication with transgender employees is key to ensuring that their concerns are heard, and that they understand what can and cannot be done by the employer. For example, employers may be required to use legal names on documents with legal effect – such as payroll and tax forms or benefit forms. Without knowing more, I can’t determine if Babeland had to use the employee’s legal name for its timekeeping system. If it did, then it appears that Babeland didn’t explain that to the employee. Perhaps, if the employee better understood the reason for the employer’s need to use the legal name, she could have changed her name legally. On the other hand, perhaps the employer could have used the employee’s preferred name in the system, but then use her legal name for, say, her W-2 – if only it had realized it. In any case, it seems like some of the concern could have been addressed by the employer if it had been a little more aware of possible issues that can arise with transgender employees.