Second Circuit Holds That Sexual Orientation Discrimination Is Covered by Title VII

On February 26, 2018, the Second Circuit Court of Appeals, sitting en banc, overruled its own precedent and ruled in the case of Zarda v. Altitude Express, Inc. that Title VII of the 1964 Civil Rights Act covers discrimination based on sexual orientation. The decision held that an individual’s sex is necessarily a factor in any discrimination based on sexual orientation, pulling it within the sphere of Title VII protection, which bans sex-based discrimination. The court is only the third appeals court to hear the issue, and the second to find in favor of greater protection.  While this decision, or another like it, could end up before the Supreme Court, it marks an important victory for those facing discrimination based on sexual orientation.

The Case

The plaintiff, Mr. Zarda, was a sky-diving instructor who was fired following an incident in which he told a female customer that he was “100 percent gay,” purportedly to make her more comfortable with being strapped to him during the sky-diving jump. Zarda claimed that he was fired as a result of discrimination based on his sexual orientation. Title VII bars workplace discrimination that is based on “race, color, religion, sex or national origin.”  The question before the court was whether Title VII prohibits discrimination on the basis of sexual orientation because it constitutes a form of discrimination “because of sex,” or whether that phrase solely encompasses discrimination against someone because of being male or female or failing to conform to male or female stereotypes.

Unusually, the case saw the Equal Employment Opportunity Commission (“EEOC”) arguing on the opposite side of the Department of Justice.  The Department of Justice took the position that Title VII does not bar discrimination based on sexual orientation.  By contrast, the EEOC argued that discrimination based on sexual orientation is covered by Title VII, consistent with the position it has taken since 2015, as the Zarda decision explicitly notes.  (Op. at 8).  In Baldwin Foxx, the EEOC held for the first time that “sexual orientation is inherently a ‘sex-based consideration;’ accordingly an allegation of discrimination based on sexual orientation is necessarily an allegation of sex discrimination under Title VII.”  (Id.) (quoting Baldwin v. Foxx, EEOC Decision No. 0120133080, 2015 WL 4397641, at *5 (July 15, 2015) (citation omitted)).  The EEOC has made this position clear through subsequent litigations and amici briefs, and maintains a public list of court decisions that support coverage of sexual orientation-related discrimination as sex discrimination.[1] The split between the Department of Justice and EEOC garnered questions from the judges at oral argument, who noted that the situation was “a little awkward.”

The Decision

The majority decision of the en banc court, written by Chief Judge Robert A. Katzmann, was joined in whole or part by nine other judges. The remaining three judges dissented. Seven of the judges wrote separate opinions, some concurring and some dissenting.

The court faced the initial hurdle of explaining why Title VII should be “expanded” to include sexual orientation discrimination, when that language did not appear in the legislation, and why this question was appropriate to consider. The court recognized that the legislative intent may not have been to address discrimination based on sexual orientation but reasoned that “[a]pplying Title VII to traits that are a function of sex is consistent with the Supreme Court’s view that Title VII covers not just ‘the principal evil[s] Congress was concerned with when it enacted’ the statute in 1964, but also ‘reasonably comparable evils’ that meet the statutory requirements.” (Op. at 20) (citations omitted) (alterations in original).  Further, the court noted the “potential persuasive force” of new decisions and arguments that had not previously been considered by the court.  (Op. at 9).

Overcoming these initial questions, the majority opinion went on to conclude that “sexual orientation discrimination is motivated, at least in part, by sex and is thus a subset of sex discrimination.” (Op. at 20-21). The court supported this conclusion with three core reasons.

First, the majority reasoned that the proper statutory reading of Title VII supports encompassing sexual orientation discrimination because “sex is necessarily a factor in sexual orientation.” (Op. at 21). The court turned to a comparative or “but for” test, and held that the proper application of the test in this instance consisted of asking whether “the employee would have been treated differently ‘but for’ his or her sex.”  (Op. at 37).  The decision further explained that in the context of a sexual orientation case, the question is whether “a woman who is subject to an adverse employment action because she is attracted to women would have been treated differently if she had been a man who was attracted to women.”  (Id).  If the answer is yes, then this constitutes discrimination because of sex, therefore falling within the sphere of Title VII protection.

Second, the court noted that “sexual orientation discrimination is almost invariably rooted in stereotypes about men and women.”  (Op at 38).  The court invoked the Supreme Court decision of Price Waterhouse v. Hopkins, 490 U.S. 228 (1989) to support the argument that employers may not discriminate against women or men who do not conform to conventional gender norms.  The court concluded that discriminating based on assumptions about the gender to which an individual should be attracted falls within this category of prohibited discrimination.

Third, the court turned to racial discrimination cases to find support for the conclusion that sexual orientation discrimination is a subset of sex discrimination because it is a form of associational discrimination.  An employee becomes a victim of associational discrimination where that employee’s protected characteristic – in this case, their sex – becomes a motivating factor for an adverse employment action.  “For example, when an employer fires a gay man based on the belief that men should not be attracted to other men, the employer discriminates based on the employee’s own sex.”  (Op. at 48).

The nearly 70-page majority decision summed up its reasoning as follows:

Title VII’s prohibition on sex discrimination applies to any practice in which sex is a motivating factor. As explained above, sexual orientation discrimination is a subset of sex discrimination because sexual orientation is defined by one’s sex in relation to the sex of those to whom one is attracted, making it impossible for an employer to discriminate on the basis of sexual orientation without taking sex into account. Sexual orientation discrimination is also based on assumptions or stereotypes about how members of a particular gender should be, including to whom they should be attracted.  Finally, sexual orientation discrimination is associational discrimination because an adverse employment action that is motivated by the employer’s opposition to association between members of particular sexes discriminates against an employee on the basis of sex.  Each of these three perspectives is sufficient to support this Court’s conclusion and together they amply demonstrate that sexual orientation discrimination is a form of sex discrimination.

(Op. at 67-68) (emphasis in original).

Despite the lengthy majority opinion, for at least one judge, the issue was entirely straightforward. Judge José Cabranes wrote a one-page decision concurring in the judgment, which contains only one paragraph of reasoning:

This is a straightforward case of statutory construction. Title VII of the Civil Rights Act of 1964 prohibits discrimination “because of . . . sex.” Zarda’s sexual orientation is a function of his sex.  Discrimination against Zarda because of his sexual orientation therefore is discrimination because of his sex, and is prohibited by Title VII.  That should be the end of the analysis.

(Concurring Op. of Judge Cabranes at 1) (citations omitted).

Impact

For New York employers, this case will have little impact, as state laws already protect against discrimination based on sexual orientation.[1] However, many courts around the country have held that sex discrimination under Title VII does not encompass discrimination based on sexual orientation; the Department of Justice argued as such in this case as amici, and the only two other federal appeals courts to reach the issue have come down on opposite sides.[2] Given the uncertainty generated by the differing decisions, the Zarda decision was an important step towards further protections for those facing discrimination on the basis of sexual orientation.  It should also serve as a reminder to employers who operate in jurisdictions with narrower protections to consider whether policy changes may be in order so that they can better align their policies with the shifting legal landscape.

The Department of Justice and the employer in the Zarda case can ask the Supreme Court to review the decision. Even if neither seeks review at this time, there is already a circuit split in this area of law, and thus, the issue is likely to be reviewed by the Supreme Court sometime in the future.

* * *

The case is Zarda v. Altitude Express, Inc., No. 15-3775 (2d Cir. 2017).

[1]       Among other protections, the Governor of New York signed into law the Sexual Orientation Non-Discrimination Act in 2002, which added the term “sexual orientation” to the list of protected characteristics in various state laws such as the Human Rights Law, the Civil Rights Law, and the Education Law.

[2]       The Seventh Circuit held that discrimination on the basis of sexual orientation is banned by Title VII, while the Eleventh Circuit held the opposite.  The cases are Kimberly Hively v. Ivy Tech Community College, No. 15-1720 (7th Cir. April 4, 2017) and Jameka K. Evans v. Georgia Regional Hospital, et al., 15-15234 (11th Cir. March 10, 2017), respectively.

[1]       U.S. Equal Employment Opportunity Commission, “Examples of Court Decisions Supporting Coverage of LGBT-Related Discrimination Under Title VII,” available at https://www.eeoc.gov/eeoc/newsroom/wysk/lgbt_examples_decisions.cfm (last accessed March 2, 2018).