After the recent Supreme Court decision regarding gay marriage, we predicted a ripple effect that would lead to prohibitions on employment discrimination on the basis of sexual orientation. That prediction has become a reality.

On July 15, 2015, the Equal Employment Opportunity Commission (EEOC) ruled in a 3-2 decision that under Title VII of the Civil Rights Act of 1964, “allegations of discrimination on the basis of sexual orientation necessarily state a claim of discrimination on the basis of sex.” The complaint was brought in 2012 by an air traffic control specialist against Transportation Secretary Anthony Foxx after being denied a promotion to a managerial position. The complainant alleged discrimination on the basis of sex and retaliation as a result of protected activity, thus triggering Title VII protections. However, the alleged motive for the discriminatory action was the complainant’s sexual orientation.

Currently, 22 states prohibit employment discrimination on the basis of sexual orientation in the public and private sector; an additional 10 states have similar prohibitions that only apply to public-sector jobs. Yet there is currently no federal statute that explicitly prohibits discrimination on the basis of sexual orientation. The Employment Non-Discrimination Act (ENDA), a bill that has been pending in Congress for many years, would prohibit discrimination on the basis of sexual orientation. However, unless and until that legislation passes, gay and lesbian employees seeking federal protection, as well as those living in states without statutory protections, have attempted to characterize their claim as one of discrimination on the basis of sex. This approach has been successful in some cases, while in others, gay and lesbian employees are left with no protections, waiting for legislative action. As a practical matter, employees might not have to wait any longer.

This decision is not binding on courts. To the contrary, sexual orientation discrimination will not be prohibited across the country until either Congress passes the ENDA or the Supreme Court issues a decision adopting the EEOC’s decision. However, the decision unequivocally clarifies that, under Title VII, federal workers cannot be discriminated against based upon sexual orientation. Moreover, EEOC interpretations of Title VII are highly persuasive and predictive. Courts typically give great deference to the EEOC’s interpretation of Title VII and all civil rights statutes and legislation. Thus, employees who might otherwise have no protections will now have further support for the argument that discrimination on the basis of sexual orientation is prohibited as a form of sex discrimination.

Regardless of whether the courts adopt this decision, the EEOC will be extending the protections of Title VII to gay and lesbian employees going forward and it is likely that most state human rights administrative agencies will take the same position. The EEOC’s decision is likely to have a significant impact on the outcome of these claims — especially since the bulk of employment discrimination cases are resolved before they are ever removed to court.

Employers relying on state law and assuming that Title VII protections do not extend to LGBT employees will be vulnerable. When faced with everyday decisions such as what, if any, response is needed to an internal complaint of discrimination, or what protected classes to include in your non-discrimination policy, proceed with caution. Discrimination against gay and lesbian employees is technically not illegal in states that have no statutory protections. However, that will not stop the EEOC or a state agency from determining that the employee stated a viable claim of sex discrimination. Therefore, the prudent and practical course is to proceed as though it is already a protected class.

For more information on how this could impact your business, please contact:

• Caroline J. Berdzik (609.986.1314; cberdzik@goldbergsegalla.com)
• Or another member of the Goldberg Segalla Employment and Labor Practice Group.