by Anna A. Cohen and Desiree E. Busching

On April 20, 2012, in a noteworthy decision, the Equal Employment Opportunity Commission (“EEOC”) ruled that Title VII of the Civil Rights Act of 1964 (“Title VII”) protects transgender individuals from disparate treatment. Macy v. Holder, Appeal No. 0120120821, Agency No. ATF-2011-00751 (EEOC, Apr. 20, 2012).  The case therefore opens up a new protected category which, while already recognized under many state and local anti-discrimination statutes and by some federal courts, had not previously been formally recognized by the EEOC.  Employers may want to consider updating employment policies, such as anti-discrimination policies, to include “transgender status” or “gender identity” as protected categories (if they have not already done so because of applicable state or local laws) and to train managers not to discriminate, harass or retaliate against employees or applicants based on transgender status or gender stereotyping.

The Case

Mia Macy (“Macy”), a police detective, applied for a position with the Bureau of Alcohol, Tobacco, Firearms and Explosives (“ATF”).  Macy interviewed for the position by telephone and was promised the position pending completion of a background check.  A few months later, Macy informed the third-party contractor responsible for filling the position and performing her background check that she changed her name and gender (from male to female) and requested that the contractor inform ATF of these changes.  Five days later, Macy received an e-mail stating that due to federal budget reductions, the ATF position was no longer available.  Macy later learned that the position had not been cut, but had been offered to another candidate.

Complaint of Discrimination

Macy filed a complaint with the EEO officer at the ATF alleging discrimination on the basis of gender identity stereotyping.  The ATF interpreted Macy’s complaint to encompass a gender discrimination claim and a gender identity stereotyping claim.  With respect to the gender discrimination claim, the ATF followed the Department of Justice’s (“DOJ”) policy of processing the claim through the EEOC, which provides for remedies pursuant to Title VII.  With respect to the gender identity stereotyping claim, the ATF processed it through a separate DOJ process that allows for fewer remedies than Title VII and does not include the right to request a hearing before an EEOC Administrative Law Judge or the right to appeal the final DOJ decision.

Appeal to the EEOC

Macy appealed to the EEOC the ATF’s decision to process her gender identity claim separately and requested that the EEOC adjudicate the claim that she was discriminated against on the basis of “sex stereotyping, sex discrimination based gender transition/change of sex, and sex discrimination based gender identity.”  In its decision to process the entire complaint pursuant to Title VII, the EEOC noted that the Supreme Court has held that Title VII bars not just discrimination based on biological sex, but also gender stereotyping – in other words, failing to act and appear according to expectations defined by gender – and that the terms “gender” and “sex” are often used interchangeably to describe discrimination under Title VII.  See Price Waterhouse v. Hopkins, 490 U.S. 228, 239 (1989).

Although most of the federal circuit courts have recognized that gender stereotyping constitutes discrimination prohibited by Title VII, this decision by the EEOC is significant.  Other than a proposed amicus brief submitted by the EEOC to the court in the Western District of Texas on October 17, 2011 in Freedom Buick GMC Truck, No. 07-115 (W.D. Tex. Oct. 17, 2011) (the judge denied as moot the EEOC’s motion for leave to file an amicus brief), this is the first case in which the EEOC has expressly adopted the position that disparate treatment of an employee because he or she is transgender is discrimination “because of . . . sex” under Title VII.

Now, because of this decision, transgender employees who experience workplace discrimination can file a discrimination charge with the EEOC at any of its 53 field offices.  If the allegations are found to have merit, employees will be entitled to remedies pursuant to Title VII, including hiring, reinstatement, and back pay.  In addition, the EEOC may bring lawsuits directly in court against employers it has determined have discriminated, harassed, or retaliated against transgender employees or applicants.