The EEOC recently ruled that Title VII’s prohibition of discrimination “because of . . . sex” now includes protection for any transgender individual. With this ruling, the EEOC expressly overturns earlier EEOC decisions to the contrary dating back to 1984, 1994 and 1996. Employers should be aware that, according to the EEOC’s current interpretation, any transgender applicant or employee enjoys all of Title VII’s protections against discrimination or harassment.

The complainant had applied for a job with the ATF while a male and believed she was going to be hired given certain promises made in the application process. Later, when the ATF learned she was transitioning from male to female, she was told that funding for the job was no longer available; that information, she later learned, was not accurate.

When the applicant filed her EEOC charge, she alleged sexual orientation and gender identity discrimination. At the agency level, the EEOC was not willing to process those claims in her charge. The agency explained it was not authorized to investigate such claims because they are not protected categories under Title VII, and it referred those charges to the Department of Justice. The complainant appealed to the full Commission the agency’s refusal to process those aspects of her discrimination charge.

The full Commission overruled the agency. The Commission concluded that discrimination against a transgender individual because that person is transgender is, by definition, discrimination based on sex.

Although this case involved a public agency, private employers will be impacted by this ruling.

The impact for employers includes:

• There is now a new protected category – namely transgender status.
• Of course, as savvy employers have known, transgender individuals have had some protections under case law trends if the alleged discrimination were based on “sexual stereotyping” (i.e., the employee’s actions or mannerisms or appearance was not sufficiently “male” or “female; an employer’s stereotyping in this manner could form the basis of a gender discrimination claim). Here, however, contrary to its prior positions rulings over a 30-year period, the EEOC has now ruled that transgender status is protected under the umbrella of the protections against sex discrimination, even without showing any “stereotyping.”
• Employers will face challenges in an employee’s transition from male to female or vice versa in the use of gender-specific restrooms, dressing areas, etc. It is not clear whether the EEOC will insist that employer’s must allow a male employee, in transitioning to female but before the completion of the process, to use female restrooms or dressing rooms. Look for employers to demand some guidance here from the EEOC in what it considers appropriate, and inappropriate, responses to these, and other such issues.
• Employers also will face training challenges in making sure employees understand the significance of these protections, and, of course, an employer’s duty to protect transgender employees could reach to Facebook and other social media postings.

Note: Look for this ruling to form the basis for political battles, and legislative initiatives to overturn it, in the upcoming election season.