How is Corporate America doing with LGBT policies?

Excerpted from Lexology by Fisher Broyles LLP

The Human Rights Campaign (HRC) Foundation gives us some indicator to answer this question.

Last week, the HRC released its 2019 Corporate Equality Index report— a national benchmarking tool on corporate policies and practices related to lesbian, gay, bisexual, and transgender (LGBT) equality.

Some results are as follows:

• 571 US companies and law firms made a perfect equality score, including a record number offering transgender health care policies;

• 93% of Fortune 500 companies provided employment protections based on sexual orientation in the US and globally;

• 85% of Fortune 500 companies include gender identity as part of their nondiscrimination policies.

The criteria to get on this list include an employer’s provision of employee benefits, non-discrimination policies, responsible corporate citizenship, transgender-inclusive health care and a public commitment to LGBTQ equality.

Considering said criteria, the HRC compiled the data in the Index from the Fortune 1000 list of public companies, law firms listed in the Am Law 200, and any privately held company with more than 500 employees that asked to be included.

You can read the full report and peruse the Index.

The Index explains that clearly enumerated non-discrimination protections based on sexual orientation and gender identity are essential to LGBT workforce equity and inclusion. The policies help to ensure:

● Equal opportunity for all employees;
● Diverse talent acquisition and retention for broader economic growth; and
● Keeping the employer apace with changing legal and public opinion landscapes.

The Index elucidates the business upside of these policies—minimal upfront costs, and rates of litigation upon implementation are consistent with other protected classes.

There are more. As I wrote about previously, studies show that supportive, inclusive LGBT policies augment a company’s performance overall and lead to increased profitability as well.

Tell us, Amy—Who’s on the list?

Among the companies receiving a perfect score were Marriott, a long-time supporter of LGBT rights, Hilton, ADP, American Airlines, G.E. (a company we’ve noted for its diversity and inclusion policies), Carnival Cruises, Southwest Airlines, TripAdvisor, Expedia, and United Airlines, which recently became the first US airline to offer non-binary gender options to passengers booking flights.

Dow Chemical, which I wrote about in discussing their LGBT policies here, makes the list again. As I noted then, Dow fosters an inclusive work environment, which has translated to less attrition and increased profitability for the company. G.E. does the same, which we told you about here, as does Marriott International.

Companies are getting more and more #woke.

What does the law say about LGBT protections in the workplace?

The federal courts are divided on this issue. Why? Well, remember that Title VII of the Civil Rights Act of 1964 (Title VII), the federal anti-discrimination law that prohibits sex discrimination, does not offer protection on the basis of sexual orientation because it is not expressly prohibited in that statute.

NB: sexual harassment is not expressly proscribed by Title VII, yet it is illegal as sex discrimination.

As Rich Cohen and I have written about, most recently, and federal appeals courts are divided about whether Title VII prohibits sexual orientation and gender identity discrimination since these are not explicitly protected classes in the text Title VII.

We and our partner Eric Meyer have explained the “Price Waterhouse approach” courts have taken in cases like Zarda v. Altitude Express, when the US Court of Appeals for the Second Circuit ruled that the district court correctly determined that an employee’s was fired just because of her failure to conform to sex stereotypes, in violation of Title VII, and stated that:

…The district court erred, however, in finding that [the employee] could not alternatively pursue a claim that she was discriminated against based on her transgender and transitioning status. Discrimination based on transgender and transitioning status is necessarily discrimination based on sex, and thus the EEOC should have had the opportunity to prove that the [the employer] violated Title VII by firing Stephens because she is transgender and transitioning from male to female.

…It is analytically impossible to fire an employee based on that employee’s status as a transgender person without being motivated, at least in part, by the employee’s sex.

The Sixth Circuit held the same was true in Equal Employment Opportunity Commission v. R.G. &. G.R. Harris Funeral Homes, Inc., Indeed, that court concluded.

Discrimination against employees, either because of their failure to conform to sex stereotypes or their transgender and transitioning status, is illegal under Title VII.

The US Supreme Court has not yet taken up LGBT workplace rights under Title VII so until then, whether sexual orientation and gender identity or expression is protected from workplace discrimination depends on the appellate jurisdiction.

Employer Takeaways:

Getting back to the Corporate Equality Index, how can a corporate employer (a) get on this list for 2020; (b) avoid scrutiny by the EEOC; and (c) became a workplace known for its equal treatment of all employees regardless of sexual orientation and gender identity?

1. Implement inclusive, anti-discrimination corporate policies that specifically include sexual orientation and gender identity as protected characteristics in all areas of employment (hiring, promotions, firing, transfers, etc.);
2. Provide equal benefits to same-sex couples, especially health insurance;
3. Have contractor or vendor nondiscrimination policies that include sexual orientation and gender identity;
4. Offer health insurance coverage that includes transgender treatments;
5. Have an employee resource group that your company expressly supports.

For companies striving for diversity and inclusion and equality, this is also a matter of risk mitigation: the EEOC’s Strategic Enforcement Plan for 2017-2021 includes a mandate for” protecting lesbians, gay men, bisexuals and transgender (LGBT) people from discrimination based on sex.”