This is one of the most impactful years that the Supreme Court has had on labor and employment law. The Court took on a number of important and controversial issues including gender identity and sexual orientation discrimination, the DACA program, the standard that must be met for proving age discrimination under the Age Discrimination in Employment Act and race discrimination under Section 1981, whether the ministerial exception applies to teachers at religious schools, and whether the government properly exempted religious institutions from the contraception mandate under the Affordable Health Care Act (Obamacare). The impacts and the follow-up cases clarifying the decisions from this term will continue to be felt for years, especially in the context of issues involving sexual orientation and gender identity discrimination.
Bostock v. Clayton County (Consolidated with Altitude Express v. Zarda, and R.G. & G.R. Harris Funeral Homes Inc. v. Equal Employment Opportunity Commission)
This was by far the biggest case to come out of the Supreme Court in employment law in years. The Court held that Title VII of the Civil Rights Act of 1964 prohibits discrimination against individuals based on their gender identity (transgender discrimination) and their sexual orientation. Essentially, employers cannot discriminate against employees on the basis of their sex, which includes gender identity and sexual orientation. Employers should update their handbooks to ensure that discrimination against individuals on the basis of sexual orientation and gender identity is prohibited. Employers should also retrain managers to ensure that employees do not suffer these types of prohibited discrimination. As a reminder, a number of states have their own laws on sexual orientation and gender identity discrimination. This ruling will not affect those state laws. Anyone with questions should first check the laws of their state to determine the best approach to resolving sexual orientation and gender identity discrimination issues.
Justice Alito’s dissent outlined the most controversial issues that will be decided by future cases (these are described below in each subheading). The biggest questions that remain from the case involve the interaction between the law’s prohibition against gender identity and sexual orientation discrimination and its protection of religious liberty.
“[B]athrooms, locker rooms, [and other things] of [that] kind”
When will an employee that is transitioning be permitted (or required) to use the locker room or bathroom associated with their gender identity? How does this right interact with the rights of other employees that may not feel comfortable sharing a bathroom or a locker room with an employee who has not had gender reassignment surgery? Courts will help resolve this issue. Many states have their own statutes (and subsequent cases) clarifying these protections. It remains to be seen how the rights will be protected/interpreted under Title VII, but one should expect the law to settle along similar lines as those in the various states (i.e. it is likely that employees will have the right to use the locker room or bathroom associated with their gender identity at some point in the future).
Women’s Sports
Whether transgender athletes can or are required to participate in the team that is in line with their gender identity. This is not an employment issue (except for paid female athletes), but it is a question that will need to be resolved based on the ruling. Many states are examining this question for sports including most recently Idaho. It is an issue that will likely continue to be litigated.
Healthcare
There are likely to be lawsuits by transgender employees that have employer sponsored health plans that do not cover the cost of gender reassignment surgery. Many of these plans will likely start to cover the surgery due to social pressure anyway, but it is an issue that still needs to be resolved.
Freedom of Speech
Employees don’t have “freedom of speech” in the workplace. Companies can fire employees for what they say as long as the firing would not be for an unlawful reason (speech that is protected under the National Labor Relations Act, whistleblowing protections of various statutes, or protected by another law). For example, a company could and should fire someone for making a death threat against another employee. A company cannot fire someone because they say that the company needs a union.
The dissent in the Bostock case stated that “the Court’s decision may also pressure employers to suppress any statements by employees expressing disapproval of same-sex relationships and sex reassignment procedures. Employers are already imposing such restrictions voluntarily, and after today’s decisions employers will fear that allowing employees to express their religious views on these subjects may give rise to Title VII harassment claims.” The interaction of the decision with issues of religion and the protections that individuals have to practice their religion will undoubtedly be the most interesting.
Babb v. Wilkie
The Supreme Court ruled that under the ADEA (Age Discrimination in Employment Act) a plaintiff only needs to prove that age is a motivating factor in an employment decision for there to be a violation of the ADEA. However, but-for causation (but for their age the employee would not have suffered the adverse employment action) is important to determining the appropriate remedy for a violation of the ADEA. For example, a plaintiff cannot obtain some forms of relief, like hiring, reinstatement, backpay, and compensatory damages without a showing of but for causation. Plaintiffs could get injunctive or other forward-looking relief if they cannot show that age was a but-for cause of the employment decision but merely a motivating factor.
The decision will make it easier for plaintiffs to obtain relief under the ADEA as some forms of relief may be available even if they cannot meet the but-for causation standard.
Comcast Corp. v. National Association of African American-Owned Media
The Supreme Court unanimously ruled that under 42 U.S.C. § 1981 a plaintiff must show that race was the but-for cause of the plaintiff’s injury rather than a mere motivating factor (one factor among others that lead to the adverse employment action).
The case will make it easier for companies to defend against Section1981 claims, but employees that cannot meet the but for causation standard may be able to meet the motivating factor standard under Title VII and choose to file a charge with the EEOC or their respective state agency.
Department of Homeland Security v. Regents of the University of California
While this is not strictly an employment law case, it will have a big impact on employment.
As I said in a prior post, “DACA (the Deferred Action for Childhood Arrivals) protects certain people that were brought to the US as children from deportation and allows them to get a job or attend school. They cannot obtain permanent residency through the program but may obtain work authorization and continue to reside in the country. There are currently nearly 700,000 people that are in the DACA program.”
In this case, the Supreme Court ruled that the Trump administration’s order to undo the Deferred Action for Childhood Arrivals was arbitrary and capricious (the administration did not conduct a thorough review of all the relevant factors that it should have taken into account such as any “legitimate reliance” that individuals had on the DACA memo, whether the government could have eliminated eligibility while continuing forbearance, and giving consideration to other policy alternatives). Instead, the Trump administration relied only on the illegality of providing the benefit by the prior administration as its reason for ending it.
Little Sisters of the Poor Saints Peter and Paul Home v. Pennsylvania
This is one of the three major religious liberty cases that were before the Supreme Court this year. It may provide some insight into how the Court will view religious liberty issues in the future within an employment context, especially how they relate to sexual orientation and gender identity discrimination.
In a 7-2 decision, the Court concluded that:
As we have explained, RFRA [(Religious Freedom Restoration Act)] “provide[s] very broad protection for religious liberty.” Hobby Lobby, 573 U. S., at 693. In RFRA’s congressional findings, Congress stated that “governments should not substantially burden religious exercise,” a right described by RFRA as “unalienable.” 42 U. S. C. §§2000bb(a)(1), (3). To protect this right, Congress provided that the “[g]overnment shall not substantially burden a person’s exercise of religion even if the burden results from a rule of general applicability” unless “it demonstrates that application of the burden . . . is in furtherance of a compelling governmental interest; and . . . is the least restrictive means of furthering that compelling governmental interest.” §§2000bb–1(a)–(b). Placing Congress’ intent beyond dispute, RFRA specifies that it “applies to all Federal law, and the implementation of that law, whether statutory or otherwise.” §2000bb–3(a). RFRA also permits Congress to exclude statutes from RFRA’s protections. §2000bb–3(b).
The essence of the decision is that the government acted lawfully to expand the contraception exemption for employers like the Little Sisters of the Poor. Justices Alito and Gorsuch wished to go further and rule that the RFRA required the government to do so, but that issue was not necessarily ripe at the time. Of course, that will likely be one of the major cases before the Court in the future.
Our Lady of Guadalupe School v. Morrissey-Berru
In this case, the Supreme Court applied the ministerial exception to teachers at religious schools. The ministerial exception bars ministers from suing churches, synagogues, mosques, and religious institutions for employment discrimination. The Court, in a 7-2 decision, found that the school and religious institution meet the exception because the teachers are responsible for instructing the students in their faith. Whether the exception applies depends heavily on the beliefs of the particular faith and the employee’s role in teaching or developing it.
As a reminder, the ministerial exception grew out of the idea that religious institutions should be able to remove ministers without interference from the government. This makes sense for many reasons. For example, it would be weird, and unjust for a Lutheran church to be sued for discrimination because the pastor became a Buddhist and the church terminated his contract. The minister of a Lutheran church or the minister (or equivalent position) of any faith should obviously believe the teachings of that particular faith to hold that position.
Other issues and forms of discrimination are a little less clear (such as disability issues) but the Supreme Court determined that the employees subject to the ministerial exception do not have that protection. The reach of the exception will generally be limited as it only applies to people that teach the faith (i.e. are ministers). It is not going to be broadened to apply to those that work at religious institutions that are not tasked with ministerial duties (teaching the faith) such as janitors, administrators, and even those that work at many nonprofits that are owned by religious institutions (such as universities and hospitals).
Conclusion
This was a huge year for labor and employment decisions from the Supreme Court. The Court altered the impact of Title VII by finding that it protects individuals from discrimination based on their sexual orientation and gender identity. It also decided three cases regarding protections for religious beliefs (it found for the religious institutions in all three cases) including one case where the Court found that states cannot bar taxpayer aid to parochial and other religious run schools if they provide aid to nonreligious schools (essentially the Court found that states cannot discriminate against schools based on their religion). It seems inevitable that there will be a clash between religious protections and issues involving gender identity and sexual orientation. Courts will need to determine how these rights interact.
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