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In a landmark decision, the Equal Employment Opportunity Commission held that discrimination against transsexual employees constitutes “sex discrimination” in violation of the Title VII of the Civil Rights Act of 1964.  While there has been a progressive shift toward protection of gender identity in state and federal court decisions and state statutes, the EEOC’s decision in Macy v. Holder marks the first time a court or agency with nationwide authority has held that transsexuals are protected by Title VII.

A transsexual is someone who identifies with a gender other than his or her biological sex.  The term applies both to those who have had sex reassignment surgery and those who have not.  It is not the same as sexual orientation, which refers to a person’s sexual preference.  A number of other terms, such as “transgender,” describe similar concepts.

The EEOC’s decision, and some of the court decisions on the subject, extends coverage under Title VII only to transsexuals.  While some argue that similar logic should be used to extend coverage to gay, lesbian, and bisexual employees, few courts have done so.   Most employment protection for gay, lesbian, and bisexual employees comes from state statutes.

 Now What?

Even if federal courts ultimately chip away at the EEOC’s decision, for now employers who discriminate against transsexuals are subject to the EEOC’s enforcement powers.  To protect yourself, you should review your policies and practices to be sure they are not discriminatory.  Consider not only hiring, firing, and promotion decisions, but also workplace harassment and the provision of workplace facilities – lockers and bathrooms, all of which fall within the purview of the EEOC.

If your sexual harassment training does not already cover gender identity and sexual orientation, it is probably time for an update.  Workplace harassment and retaliation are among the hottest areas of discrimination, and transgender claims of discrimination fit into these issues perfectly.  Even if your state does not prohibit discrimination on the basis of sexual orientation, the shifting tide of federal decisions under Title VII suggests employers should not ignore sexual orientation when dealing with harassment issues.

While the EEOC’s decision does not directly address restroom use policies, this is a common concern for employers and employees.  Many people are uncomfortable with sharing restrooms with members of the opposite sex, and a transsexual employee’s choice of restroom may cause discomfort for co-workers or customers.  To manage this concern, many employers choose to designate one or more single-stall restrooms as unisex.  Consider implementing such an option, even if you have no transsexual employees, to avoid potential problems down the road.

The EEOC’s decision is characteristic of the Obama Administration’s propensity to expand the scope and enforcement of existing laws, rather than enacting new legislation.  The words of Title VII are unchanged, but how employers need to view their obligations to gay, lesbian, bisexual, and transsexual employees under the law is rapidly changing.

Brody and Associates regularly provides counsel on civil rights issues and employment laws in general.  If we can be of assistance in this area, please contact us at info@brodyandassociates.com or203.965.0560.