A significant new frontier in the employment discrimination field is finding ways to protect employees who are fired, denied a promotion, or harassed just for being lesbian, gay, bisexual, or transgender (LGBT). Already, 12 states and the District of Columbia prohibit discrimination based on sexual orientation as well as gender identity and expression. (Another eight states have legal protections only for sexual orientation discrimination.) Those laws protect not only lesbian, gay, and bisexual employees, but also transgender employees–those whose internal sense of themselves as male or female (their “gender identity”) and/or the way they express that gender identity through their appearance, clothing, or behavior (their “gender expression”) differs from the anatomical sex they were designated at birth.

As described in Phil Duran’s excellent recent blog post, we may see similar protections enacted in federal law in the near future. LGBT advocacy organizations and others are currently lobbying members of Congress to support a version of the proposed Employment Non-Discrimination Act (ENDA) that would prohibit discrimination based on both sexual orientation and gender identity and expression.

In the meantime, though, courts have been increasingly open to claims brought on behalf of LGBT employees who face discrimination, using what may seem like an unexpected theory: sex discrimination. In 1989 the U.S. Supreme Court held, in a case called Price Waterhouse v. Hopkins, that federal sex discrimination laws protect employees who are discriminated against because of their perceived failure to conform with gender stereotypes–that is, women who are perceived as too masculine, or men who are perceived as too feminine. Price Waterhouse was a case brought by a woman who was denied a promotion at an accounting firm, despite her excellent performance, because her supervisors considered her too “macho.” They suggested that she ought to “walk more femininely, talk more femininely, dress more femininely, wear make-up, have her hair styled, and wear jewelry.” The Supreme Court held that discrimination based on that kind of gender stereotyping was a form of sex discrimination.

Even though no federal law currently prohibits employment discrimination based on sexual orientation or gender identity and expression, some LGBT employees have been able to successfully use gender-stereotyping arguments to bring sex discrimination claims when they are targeted because of their actual or perceived gender nonconformity. For instance, a sex discrimination claim may be viable when a gay man is harassed because of his co-workers’ perception that he is too feminine or when a lesbian is fired because she is seen as too masculine. Sex discrimination cases brought by lesbian, gay, or bisexual employees can be challenging to win, though, because some courts have expressed concern that the gender-stereotyping theory could be used as a back door means of recognizing what are “really” sexual orientation discrimination claims.  Unfairly, even when an LGBT employee is discriminated against because of gender stereotypes, some courts have denied relief simply because the plaintiff is gay or lesbian or because the discrimination appeared to be additionally motivated by anti-gay animus.

Interestingly, courts have been somewhat more receptive to gender-stereotyping claims brought by transgender employees.  In a groundbreaking decision just issued on September 19, 2008, Schroer v. Billington, a Washington, D.C. federal district court found that a transsexual job applicant had been discriminated against based on “sex.”  She had initially applied for the position–and been offered the job–while presenting as a man, but when she informed the employer of her intention to change her sex to female, the employer withdrew the offer.  The court not only found that gender stereotypes played an unlawful role in her hiring, à la Price Waterhouse, but also held that discrimination because a person changes their sex is “literally” sex discrimination – just as discrimination against those who convert from one religion to another would plainly constitute religious discrimination.  While no other court has yet recognized a sex discrimination claim based on transgender status per se, a number of other decisions have upheld sex discrimination claims brought by transgender employees where the employee can show some evidence that stereotypes played a role in the employee’s negative treatment.

The gender stereotyping theory of sex discrimination can provide valuable protection for lesbian, gay, bisexual, and transgender workers who face discrimination because of their perceived gender nonconformity, although some courts still fixate on the employee’s status as LGBT as a justification for denying an otherwise valid sex discrimination claim. That’s why it’s imperative to pass a fully inclusive version of ENDA: to make it clear to everyone, employers and employees alike, that it’s unlawful to mistreat employees because of traits like sexual orientation or gender identity and expression that have absolutely nothing to do with job performance.

About the Author: Ilona Turner is a staff attorney at the National Center for Lesbian Rights, a national legal organization committed to advancing the civil and human rights of lesbian, gay, bisexual, and transgender people and their families through litigation, public policy advocacy, and public education.  Prior to law school, she was the lobbyist for Equality California, the state’s leading LGBT political organization, where she helped win the passage of groundbreaking legislation that significantly expanded the rights of domestic partners under California law and prohibited discrimination based on gender identity and expression in employment and housing.  She received her J.D. from the University of California, Berkeley.

In 2007, hundreds of gay-rights organizations from across the country signed a statement opposing the first gay-rights bill ever approved by a house of Congress. Why? Because the bill, the Employment Non-Discrimination Act (ENDA), prohibited job discrimination based on sexual orientation, but not discrimination based on gender identity/expression. After the House voted to approve ENDA as written, a House committee held a first-ever hearing on the issue of gender-identity/expression discrimination. It is likely that future ENDA proposals will include both sexual orientation and gender identity/expression as protected characteristics. When that happens, Congress will once again be following the lead that employers from coast to coast have already clearly established in affirming the equal employment rights of their transgender employees.

For purposes of this article, “transgender” is an umbrella term describing people who present to the world a gender identity different from the one they were assigned to at birth. The typical transgender person, in their “mind’s eye,” firmly and sincerely sees their gender in a way that does not match their anatomy; this divergence can appear at a very early age and is not usually thought of as a choice any more than is one’s sexual orientation. Transgender people may or may not attempt to change their bodies (“transition”) to align with this gender expression (those who do are often referred to as “transsexuals”). While most transgender people use the pronouns associated with the gender they present, some avoid the use of traditional, gendered pronouns altogether.

A person who comes out as transgender and changes their gender expression often puts him- or herself at significant risk for rejection, discrimination, harassment, or even violence. There are countless transgender people who, having transitioned later in life, have difficulty finding a fulfilling job even though they have advanced degrees and years of relevant experience – somehow, exchanging pants for a skirt magically negates an MBA and professional accomplishment.

The American workplace is slowly but inexorably recognizing that transgender employees have much to offer, and deserve fair and equitable treatment. Increasingly, labor advocates are leading the way by persuading American employers to amend existing non-discrimination and anti-harassment policies to extend their protection to transgender workers. According to the Human Rights Campaign, 153 of the Fortune 500 companies have taken such a step. Clearly, there is progress yet to be made – and labor advocates are likely to be successful.

Beyond basic non-discrimination/anti-harassment policies, forward-thinking employers are also contemplating issues related to employment benefits. Most fundamentally, does an employer’s health plan, assuming there is one, cover services related to gender transition? These usually fall into three basic categories: counseling, hormones, and surgery. The vast majority of plans that cover mental-health treatment don’t draw a line around gender-identity counseling and attempt to exclude it, nor should they. This is important, because counseling is often the initial step that opens the next doors in the transition process. Some employer plans contain gender-related provisions that specifically exclude surgery, while other go further and also exclude hormones as well. More and more, however, health plans (and related plans, such as short-term disability policies) are eliminating these restrictions as employers realize that covering gender-related care significantly benefits affected employees while adding relatively little to their insurance premium. In June 2008, the American Medical Association issued a statement calling exclusions of gender-related care a form of discrimination. Workplace advocates will continue to press for change in this area, which, in turn, could positively affect the future conversation about universal health care and its scope.

Additional complexities may arise regarding a transgender employee’s partner, and their access to dependent health benefits. For example, if a married male employee transitions to female and adopts a female name, but does not divorce, does the spouse remain the employee’s wife, and therefore the employee’s dependent? Or does the spouse, in effect, become a domestic partner? (Hint: pick door number one.) This matters, because if the dependent is seen as a spouse, the benefits are a tax-free fringe benefit. On the other hand, if the dependent is characterized as a domestic partner, the benefits incur tax liability for the employee and deductions by the employer. On one level, this distinction would be immaterial if not for the tax difference, and here, labor and employers are speaking out together in favor of federal legislation that would treat spousal and partner benefits equally for tax purposes.

Taking back Labor Day means, among other things, sharing Labor Day with transgender workers, and committing oneself to learning about the issues they face, educating others, and advocating for workplace fairness for all.

About the Author: Phil Duran is the Staff Attorney at OutFront Minnesota, the state’s leading advocacy, direct service, and public policy agency for gay, lesbian, bisexual, and transgender (GLBT) Minnesotans and their allies. His work at OutFront Minnesota focuses on legal information, referral, and education; state legislative research and analysis; state administrative agency and local government public policy; school-related issues; and direct representation in selected public-assistance and human rights matters. Additionally, Duran serves on the board of the Minnesota Lavender Bar Association, which raises GLBT issues within the legal profession in Minnesota. He also is a past member of the executive council of the Minnesota State Bar Association (MSBA), and served on the steering committee of the MSBA’s Diversity in the Legal Profession Task Force. He currently serves on the MSBA Diversity Committee, MSBA Task Force on the Rights of Unmarried Couples, and Minnesota Supreme Court’s Gender Fairness Implementation Committee. Phil is a graduate of the University of Minnesota Law School.