On June 15, 2020, the United States Supreme Court ruled that a major federal law prohibiting discrimination on the basis of sex includes a prohibition against discrimination on the basis of sexual orientation and transgender status. That is, Title VII of the Civil Rights Act of 1964 (“Title VII”), protects workers from discrimination based on certain protected class statuses, including sex, but until this Supreme Court decision, federal courts differed on whether Title VII protections extended to prohibit discrimination based on sexual orientation and gender identity. This Supreme Court decision resolves the conflicts between federal courts and establishes that employers may not discriminate against workers based on sexual orientation or gender identity.

The issue of whether Title VII prohibits sexual orientation and gender identity discrimination has been winding its way through the courts for several years. In the Supreme Court opinion, the Court addressed three different cases that were combined before the Court. In one case, the employer fired an employee after the employee participated in a gay recreational softball league. In another case, the employer fired an employee a few days after he stated he was gay. And in the third case, an employer fired an employee, who presented as male at the time of hiring, after she informed the employer that she planned to “live and work full-time as a woman.” The Court ruled that, to the extent these employers terminated the employment of the employees because of their sexual orientation or transgender status and not because of a non-discriminatory reason (e.g., performance deficiencies), such termination constituted unlawful discrimination.

Specifically, the Court wrote, “A statutory violation occurs if an employer intentionally relies in part on an individual employee’s sex when deciding to discharge the employee. Because discrimination on the basis of homosexuality or transgender status requires an employer to intentionally treat individual employees differently because of their sex, an employer who intentionally penalizes an employee for being homosexual or transgender also violates Title VII.”

Depending on the employer’s state, this decision may or may not affect an employer. For example, some states, such as California and New York, already have state laws in place protecting workers from sexual orientation and gender identity discrimination. In other states, such as Florida and Georgia, state law does not prohibit employers from discriminating against workers based on sexual orientation or gender identity, so employers in these states must now ensure that they do not take any adverse action against workers based on sexual orientation or gender identity.

Moving forward, employers should amend their equal employment opportunity policies to include a ban on sexual orientation and gender identity discrimination. Employers should also continue to document employee performance concerns, budget changes, etc. to help establish that any adverse employment actions taken are because of a lawful, non-discriminatory reason, such as performance deficiencies or restructuring due to financial cutbacks.

If you have questions about this decision and how it may affect your business, please contact your Labor and Employment Counsel at Smith, Gambrell & Russell, LLP.