transgender1600A few recent events provide employers a peek behind the curtain of the Trump administration’s position on whether Title VII provides protection to LGBT individuals.

First, some background. Title VII prohibits discrimination “because of sex,” among other things. In the past, the Equal Employment Opportunity Commission (the federal agency enforcing federal anti-discrimination laws) acknowledged that Title VII did not cover sexual orientation discrimination, although it did prohibit discrimination based on sex/gender stereotyping (which could overlap with sexual orientation claims to the extent the gay or lesbian employee did not conform to male or female stereotypes).

Through federal sector decisions, however, the EEOC has subsequently taken the position that the language “because of sex” encompasses transgender status and sexual orientation.  The EEOC has then used those decisions as springboards for its private litigation program.

Specifically, in April 2012, the EEOC issued Macy v. Dep’t of Justice, which recognized claims of employment discrimination under Title VII against employees because they are transgender, because of gender identity, and/or because they have transitioned.

The EEOC’s view of sexual orientation coverage by Title VII came later.  On July 15, 2015, the EEOC issued the Baldwin v. Dep’t of Transportation decision, which recognizes that sex includes sexual orientation. The opinion directed all federal agencies to process internal claims by their employees of sexual orientation discrimination as complaints of sex discrimination. Following Baldwin, EEOC investigators were likewise directed to investigate charges of discrimination against private employers based on sexual orientation.

All of this background brings us to EEOC v. R.G. & G.R. Harris Funeral Homes, in which the EEOC sued the employer on behalf of the a former funeral director, alleging that the employer illegally discharged the director because the director was transgender, for transitioning from male to female, and for failing to conform to the employer’s sex-based dress code, which required pantsuits and neck tie for men, skirt-suits for women.  As an initial matter, the U.S. District Court for the Eastern District of Michigan granted the employer’s motion to dismiss on some allegations, finding that transgender status and gender identity are not protected classes under Title VII.  The Court, however, recognized that the EEOC stated a claim under a sex/gender stereotyping theory because the EEOC claimed the termination was due to the director’s failure to confirm to the employer’s sex/gender-based stereotypes as to appropriate work clothes.

On August 18, 2016, the Court granted summary judgment in favor of the employer and threw out the sex/gender stereotyping claim.  The Court held that the employer was entitled to an exemption under the federal Religious Freedom Restoration Act of 1993 (“RFRA”), which “provides a defense to persons whose religious exercise is substantially burdened by the government.”  42 U.S.C. § 2000bb(b)(2).  Finding the employer met its initial burden of showing that compliance with Title VII “substantially burdens” its exercise of religion, the Court then found that the EEOC failed to show that application of the burden on the employer was the “least restrictive means” of protecting employees from gender stereotyping in the workplace.  In so doing, the Court expressed surprise the EEOC did not propose a gender-neutral uniform, such as a business jacket and pants without a tie.  Unsurprisingly, given the EEOC’s clear sexual orientation/gender identity agenda, the EEOC appealed the dismissal of the sex/gender stereotyping claim to the U.S. Court of Appeals for the Sixth Circuit.

What is surprising is what came next. In a highly unusual move, on January 26, 2017, the EEOC filed a short motion for extension of time in “because of Administration-related changes at the Commission.”

The same day, the director, now represented by the ACLU, filed a 12-page motion to intervene in the lawsuit as Plaintiff-Appellant.  Notably, the motion states:

[B]ased on the change of federal administration as well as the federal government’s actions over the past few days, Ms. Stephens is reasonably concerned that the EEOC may no longer adequately represent her interests going forward.

Then, over the weekend, there was much speculation that President Trump would pull back President Obama’s Executive Order preventing discrimination based on sexual orientation or transgender status by federal contractors.  However, on Monday, January 30, 2017, the Trump administration publicly announced the LGBT executive order would stand.

What to make of these two seemingly contradictory actions?  While there are a few possibilities (such as the EEOC is concerned prospectively about being forced to withdraw and wanted Charging Party to obtain legal representation in the event that happens), reading the tea leaves shows us that it is most likely the Trump administration will not curtail the EEOC’s position that sex includes sexual orientation and transgender status.  Instead, look for the EEOC to withdraw from this suit due to the religious implications, and for the Trump administration to press for a religious exemption for employment actions that would apply to all private employers.