The United States Supreme Court ended its 2019-2020 term by issuing some important rulings that affect the employment law landscape and from which both employers and employees may draw some important lessons.
Title VII Prohibits Discrimination Based on Sexual Orientation and Gender Identity
In Bostock v. Clayton County, 140 S.Ct. 1731, 590 U.S. __ (2020), the Supreme Court considered whether Title VII’s prohibition on workplace discrimination “because of sex” also included discrimination based on sexual orientation and gender identity. By way of background, this case consolidated three separate employment discrimination cases involving longtime employees. In two of the cases, the employer terminated the employee shortly after learning of their sexual orientation. In the third case, the plaintiff employee, who presented as a male when hired, was terminated after informing the employer of her plan to “live and work full-time as a woman” and seek sex-reassignment surgery.
The Supreme Court ruled 6-3 that it is a violation of Title VII to fire an individual merely for being gay or transgender or for identifying as lesbian, gay, bisexual, or transgender (LGBT). In ruling that Title VII’s protections extend to LGBT individuals, the Supreme Court explained that “an employer who fires an individual for being homosexual or transgender fires that person for traits or actions it would not have questioned in members of a different sex. Sex plays a necessary and undisguisable role in the decision, exactly what Title VII forbids.”
The Supreme Court further rejected the notion that “sex” was limited to biological sex despite the fact that the drafters of Title VII may not have anticipated this result.
The Supreme Court went on to state that “an individual’s homosexuality or transgender status is not relevant to employment decisions. That’s because it is impossible to discriminate against a person for being homosexual or transgender without discriminating against that individual based on sex.”
The Supreme Court further suggested that an individual’s protected class status (in this case, the individual’s sexual orientation or gender identity) need not be the only reason that an individual gets fired, as long as the individual would not have been fired but for that status.
Takeaways
This decision provides job protections to a class of individuals left out of many laws at the State level. Although New Jersey has very comprehensive antidiscrimination protections, only about half of the States have laws that expressly provide job protections based on actual or perceived sexual orientation or gender identity. State laws that do provide these protections might also have broader coverage, longer statutes of limitations, or provide more expansive damage provisions and should be considered in conjunction with Title VII.
Given this decision, employers are encouraged to:
● Review workplace policies and procedures to make sure such policies and procedures explicitly prohibit discrimination, harassment, and retaliation based on sexual orientation and gender identity.
● Ensure that any seemingly neutral workplace policies (e.g., dress code policies) do not unintentionally discriminate based on sexual orientation or gender identity.
● Provide comprehensive training to all supervisors and employees on the prohibition against discrimination, harassment, and retaliation based on sexual orientation and gender identity.
● Review employee health insurance and other benefits to make sure that LGBT individuals and those with same-sex spouses have equal access to all employee benefits.
● Review policies and procedures regarding restrooms and locker rooms to address the concern that individuals may prefer to use the restroom or locker room of the gender with which they identify or to provide a gender neutral option. (Although the Supreme Court did not specifically address this issue, employers should take proactive steps.)
● Be mindful of an anticipated increase in employment discrimination, harassment, and retaliation claims based on sexual orientation and gender identity.
● Monitor the workplace for discrimination, harassment and retaliation against individuals based on sexual orientation and/or gender identity and promptly respond to and remedy, as appropriate, any complaints.
Religious Employers Shielded from Discrimination Claims Under the Ministerial Exception
In Our Lady of Guadalupe School v. Morrissey-Berru, 140 S.Ct. 2049, 591 U.S. ___ (2020), the Supreme Court evaluated whether federal antidiscrimination laws protect religious school teachers or whether the First Amendment Freedom of Religion clause shields religious organizations from suit under federal employment discrimination laws. Specifically, the ministerial exception provides that religious institutions have a First Amendment right to decide matters of the church without government interference.
The case at issue arose out of separate claims by two Catholic school teachers, one alleging age discrimination based on a failure to renew the teacher’s employment contract and the other alleging disability discrimination when the school terminated the teacher after requesting a leave of absence to obtain breast cancer treatment. The school maintained that both of these employment decisions were based on performance reasons. Both teachers were employed under nearly identical employment agreements that set forth the school’s mission to develop and promote a Catholic school faith community, and imposed commitments regarding religious instruction and personal modeling of the faith. Additionally, both teachers were expected to comply with the school’s employee handbook, which contained similar expectations. The evidence also showed that each teacher taught religion in the classroom, worshipped and prayed with their respective students, and their performance was measured on religious bases.
In a 7-2 decision, the Supreme Court held that the ministerial exception applied to bar suit under federal antidiscrimination laws as the teachers at issue performed vital religious duties and were responsible for providing religious instruction. Educating and forming students in the Catholic faith was at the core of the school’s mission and the teachers’ employment agreements and faculty handbook specified the expectation that they help carry out the church’s mission and guide students with respect to their faith.
The Supreme Court reasoned that a variety of factors are relevant in determining whether a position falls within the ministerial exception and “what matters, at bottom, is what an employee does.” Although the teachers in this case were not given the title of “minister” and they had less religious training, the Supreme Court ruled that the ministerial exception still applied as they played a vital role in carrying out the church’s mission.
Takeaways
Based on this decision, it is important for both religious employers and employees who work for such institutions to understand that courts will likely take a more expansive view of the ministerial exception going forward and give greater weight to the role of the employees with respect to employment decisions by religious institutions. Thus, this could lead to the dismissal of more federal employment discrimination lawsuits in the early stages of the lawsuit. Having employee handbooks, employment agreements, contracts, job descriptions, and other personnel documents that clearly identify any important religious functions performed by the employees and their responsibilities for carrying out the tenets of the faith will likely aid in the resolution of employment disputes between religious employers and their employees.
Employers May Opt Out of Providing Contraceptive Coverage to Employees Based on Religious or Moral Objections
In Little Sisters of the Poor Saints Peter and Paul Home v. Pennsylvania et al., 140 S.Ct. 2367, 591 U.S. __ (2020), another case dealing with religious exemptions, the Supreme Court considered whether employers with religious or moral objections to birth control may deny their employees contraceptive coverage and access to birth control under the Affordable Care Act (ACA). By way of background, the ACA requires covered employers to provide women with “preventative care and screenings” without “any cost sharing requirements,” and relies on Guidelines supported by the Health Resources and Services Administration (HRSA) to determine what “preventive screenings” includes.
By way of background, the Supreme Court’s decision in Burwell v. Hobby Lobby, 573 U.S. 682 (2014), found that the ACA’s requirements to cover contraceptive services substantially burdened the free exercise of certain businesses with sincerely held religious objections. Following the Hobby Lobby decision, the Federal Government enacted two interim rules. One rule expanded the religious exemption from the ACA’s contraceptive coverage mandate to include an employer that objects to providing such coverage based on sincerely held religious beliefs. The second rule created an exemption for employers with sincerely held moral objections to providing such contraceptive coverage.
In a 7-2 decision, the Supreme Court upheld the Government’s two interim rules, holding that the plain language of the ACA provided the HRSA with the “sweeping authority” to establish comprehensive guidelines for applicable health plans, the care they must cover, and permissible exemptions from those guidelines. The Court held that the HRSA had the authority under the ACA to promulgate the religious and moral exemptions. The Court determined that the procedure by which the rules were adopted satisfied any notice requirements by providing interested persons with an opportunity to participate in the rulemaking process, all requirements were satisfied, and any error in notice was not prejudicial.
Takeaways
Unless there are changes at the legislative level, certain employers with religious or moral objections to providing contraceptive services will be able to exclude those services from their employee health benefit plans if they fall within the language of the exemptions. As a result, employees should be aware that the right to contraceptive coverage under the ACA is not absolute and may depend upon their particular employer.
Supreme Court Permits DACA to Survive
In the Department of Homeland Security et al. v. Regents of the University of California, 140 S.Ct. 1891, 591 U.S. ___ (2020) , the Supreme Court considered whether the Department of Homeland Security (DHS) followed the proper administrative procedures when choosing to end the immigration initiative known as the Deferred Action for Childhood Arrivals program (DACA). DACA protects approximately one million young unauthorized foreign nationals brought to the United States as children, who are now living and working here, by providing such individuals with renewable two-year work permits. Such individuals are eligible for work authorization and considered lawfully present and eligible for Social Security and Medicare benefits.
In a 5-4 decision, the Supreme Court held that the DHS failed to follow proper administrative procedures and the decision to rescind DACA was arbitrary and capricious under the Administrative Procedures Act (APA). The Supreme Court determined that DHS failed to provide sufficient justification for its decision to end the DACA program and did not comply with the procedural requirements of the APA. The Supreme Court held that the DHS did not provide a sufficiently reasonable explanation for ending the program, and the DHS Secretary failed to consider the potential hardship that DACA recipients would incur with respect to the swift elimination of benefits. The Supreme Court further explained that the DHS should have taken into account the various reliance interests on the part of DACA recipients and that, since 2012, those individuals have “enrolled in degree programs, embarked on careers, started businesses, purchased homes, and even married and had children, all in reliance” on the DACA program. The Supreme Court noted that it was not deciding “whether DACA or its decisions were sound policies,” but addressing only whether the agency had complied with the procedural requirements to provide a reasoned explanation for its action, which it had not.
Takeaways
Based on this decision, DACA recipients may continue to renew their membership in this program offering employment authorization and temporary protection from deportation. Employers may continue to employ DACA recipients legally as long as such individuals continue to possess valid employment authorization documents.
