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Litigation Risk From LGBT Employees Continues To Climb

A transgender woman is suing her former employer for sexual harassment and discrimination.

She is suing the organization—a large multi-national fast food chain—and the owner of the Michigan franchise where she worked.

According to the lawsuit, managers at the restaurant subjected the former employee to "extreme sexual harassment and disparate treatment." The 25-year-old alleges that, during the five months she worked full-time at the restaurant, coworkers called her a "boy-slash-girl"; forced her to use a bathroom that was serving as a storage closet; and groped her genitals. She further alleges that management cut her hours and eventually terminated her in retaliation for reporting the abuse.

The former employee is seeking damages for lost wages, emotional pain, and loss of self-esteem. Curtis M. Wong "Trans Employee Sues McDonald's For 'Extreme Sexual Harassment,' Discrimination," (Jun. 17, 2017).


The EEOC interprets and enforces Title VII of the Civil Rights Act of 1964 as prohibiting discrimination based on gender identity and sexual orientation. Some recent court decisions in the 11th, 9th, 7th, 6th, and 1st U.S. Circuit Courts of Appeal and lower courts support the EEOC’s interpretation that Title VII protects transgender rights, and the EEOC has collected more than $6.4 million in monetary relief for LGBT employees since 2013. Hively v. Ivy Tech, (7th Cir. April 4, 2017); Chavez v. Credit Nation Auto Sales, L.L.C., 2016 WL 158820 (11th Cir. Jan. 14, 2016); Barnes v. City of Cincinnati, 401 F.3d 729 (6th Cir. 2005); Doe v. Arizona, 2016 WL 1089743 (D. Ariz. Mar. 21, 2016); Rosa v. Parks W. Bank & Trust Co., 214 F.3d 213 (1st Cir. 2000); Baker v. Aetna Life Ins., et al., __ F. Supp. 3d __, 2017 WL 131658 (N.D. Tex. Jan. 13, 2017). See also Lydia Wheeler “Transgender Rights Taking Hold In The Courts, (Jun. 06, 2017).

A lower court, however, recently dismissed a terminated, transgender embalmer’s discrimination claim brought by the EEOC, based in part on the U.S. Supreme Court’s ruling in Burwell v. Hobby Lobby Stores (2014), because the employer here, as in Burwell, was a private, closely-held corporation who objected to the employee’s transitioning on “religious” grounds.” See EEOC v. R.G. & G.R. Harris Funeral Home (E.D. Mich. 2016).

Note, however, that in the area of transgender student rights, some courts (4th and 6th U.S. Circuit Courts) are not recognizing those rights as far as disputes over bathrooms. As to discrimination enforcement, however, despite the current Administration’s rescinding of the previous Administration’s federal guidance on transgender students, the U.S. Department of Education’s Office of Civil Rights recently issued a memo (06-06-17) to regional directors telling them not to rely on the rescinded guidance for their enforcement choices, but to instead refer to "Title IX and its implementing regulations, as interpreted in decisions of federal courts and OCR guidance documents that remain in effect, in evaluating complaints of sex discrimination against individuals whether or not the individual is transgender." Evie Blad “Feds on Transgender Student Rights: Put Focus on Bullying, Not Bathrooms” (Jun. 16, 2017).

As for workplace applicants and employees, the Supreme Court will ultimately decide the issue as to the workplace, applicants, and employees; however, many states already extend legal protection to LGBT employees.

To avoid litigation, the best practice is to make certain LGBT employees and applicants are evaluated on their skills and contributions and not on their sexual orientation, preference, or gender identity. Make certain all policies and procedures are enforced in an equal manner, are gender-neutral, with an eye toward what might affect transgender employees. It is always better to avoid a lawsuit than defend one later.

Be sure to prohibit any type of retaliation against an employee who reports discrimination. Employers face the greatest risk of liability from retaliation claims, which can proceed through litigation, even if the underlying claim of discrimination is not sufficient to survive a summary judgment.

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