U.S. Court of Appeals for The Second Circuit Says Title VII Covers Discrimination Based on Sexual Orientation

Nicholas Fortuna, March 7, 2018

The Second U.S. Circuit Court of Appeals ruled last week that Title VII of the Civil Rights Act of 1964’s prohibition against sex bias in the workplace also prohibits discrimination against gay employees, becoming the second federal appellate court to do so. The case was first decided by a three-judge panel of the Circuit Court and then reargued at a rare en banc hearing – before all the judges of the court. The three-judge panel ruled against extending Title VII’s reach to include sexual orientation and the full court reversed. The decision creates another avenue to bring the issue back to the U.S. Supreme Court, which declined to hear a similar case last year.

The 10-3 ruling by the Second Circuit came in the case Zarda v. Altitude Express. The employer, Altitude Express, dismissed a sky-diving instructor, David Zarda, in 2010. While Mr. Zarda was preparing for a tandem sky-dive with a female student, he told her that he was “100 percent gay.” Her boyfriend later complained to the school about the comment.

Mr. Zarda said he had made the remark to soothe the woman, who seemed uncomfortable with being so tightly strapped to him during the dive. Mr. Zarda filed a lawsuit, claiming that his firing violated Title VII. Two courts in New York, including a three-judge panel of the Second Circuit, ruled against him.

The majority opinion, written by Chief Judge Robert Katzmann, acknowledged that the view of the law around the issue had changed. Last year, the Seventh Circuit issued a decision in favor of sexual orientation protections in the workplace under Title VII.

Also, while Zarda’s claims were pending, the EEOC decided Baldwin v. Foxx, holding that “allegations of discrimination on the basis of sexual orientation necessarily state a claim of discrimination on the basis of sex.”  The EEOC identified three ways to describe what it called the “inescapable link between allegations of sexual orientation discrimination and sex discrimination.” The specific examples the EEOC provided to illustrate this point were: (1) suspending a female employee for displaying a photo of her female spouse while not suspending a man for displaying a photo of his female spouse; (2) an employee alleging discrimination on the basis of sexual orientation because her employer treated her differently for associating with a person of the same sex; (3) and, discrimination based on “gender stereotypes,” most commonly “heterosexually defined gender norms.” Zarda unsuccessfully attempted to get the district court to rely on the EEOC’s decision in Baldwin to support his Title VII claims.

Chief Judge Katzman wrote that the determinative inquiry is whether an employee’s sex is necessarily a motivating factor in discrimination based on sexual orientation. The Court found that sexual orientation is a sex-dependent trait and sexual orientation discrimination will be considered “a subset of actions taken on the basis of sex,” and subject to protections under Title VII.

Accordingly, the legal framework in this Circuit for evaluating Title VII claims has evolved substantially. Traits that operate as a proxy for sex are an impermissible basis for disparate treatment of men and women. Discrimination based on sex stereotypes and association with the same sex are prohibited in the workplace.

The issue of sexual orientation discrimination has gotten enough traction to warrant intervention by the Supreme Court. If for no other reason, then to resolve the differing opinions issued by the Courts of Appeals. In the meantime, employers covered by the Second Circuit (New York, Connecticut, and Vermont) should update their policies and practices to ensure compliance with this decision.