Federal Court of Appeals Rules that Civil Rights Law Protects LGBT Workers from Sexual Orientation Discrimination

April 5, 2017 | By Ivo J. Becica

On Tuesday, the U.S. Court of Appeals for the Seventh Circuit made history by extending the protections of Title VII of the Civil Rights Act of 1964 to LGBT individuals in the workforce when it held that “discrimination on the basis of sexual orientation is a form of sex discrimination.” In Tuesday’s 8-3 decision, the full panel of Seventh Circuit judges overturned an October 2016 ruling by a three-judge panel of the Seventh Circuit, which dismissed the sex discrimination claims brought by Kimberly Hively, a lesbian adjunct professor against Ivy Tech Community College.  Ms. Hively claimed that the Ivy Tech refused to promote her and ultimately eliminated her position because of her sexual orientation.  In October, the three-judge panel opined that it was bound by existing precedent to differentiate between sexual orientation discrimination and sex discrimination (discrimination based on biological sex) under Title VII of the Civil Rights Act of 1964.

Since its passage in 1964, Title VII of the Civil Rights Act has prohibited discrimination in employment on the basis of race, color, religion, sex and national origin. Title VII applies to all employers with 15 or more employees.  Despite widespread social acceptance of LGBT rights and the passage of numerous state and local laws barring sexual orientation discrimination in the workplace, Congress has yet to officially expand the protections of Title VII to workers who claim they have been discriminated against based on sexual preference.  On Tuesday, however, the Seventh Circuit altered the longstanding pattern of dismissing sexual orientation claims under federal civil rights laws by ruling that the this was not a question of whether the court has the power to amend Title VII to protect a new category of individuals, but rather, that examining the definition of discrimination on the “basis of sex” under Title VII was a matter of “statutory interpretation and thus well within the judiciary’s competence.”

According to the majority opinion, authored by Chief Judge Diane Wood, Title VII has and should be interpreted to cover more than just “textbook” sex discrimination wherein an employer refuses to hire a woman because she is a woman, and vice versa. The majority cited to Supreme Court opinions that have expanded its understanding of discrimination “on the basis of sex” to include sexual harassment in the workplace, same-sex harassment, and discrimination based upon failure to conform to gender stereotypes—none of which are explicitly prohibited on the face of the statute.

The majority analyzed the two main theories of Title VII protection posited by Hively: the comparative method (if all other things are equal and only Hively’s sex is changed, would she have been treated the same way), and the associational discrimination method (the employer took action against Hively because of her intimate association with a person of a certain gender). After discussing both methods, the majority concluded that “both avenues end up in the same place: sex discrimination.”  The Court concluded that there is no difference between a gender nonconformity claim and one based on sexual orientation.  Notably, however, the Court’s opinion left other issues (such as whether a religious institution may fire or refuse to hire a LGBT candidate on religious grounds, or whether sexual orientation discrimination is prohibited in the context of providing social or public services) to be decided in future cases.

On the other hand, the dissenting judges in Hively asserted that the majority failed to interpret accurately the statutory text as it was meant to be interpreted upon adoption, resulting in a “statutory amendment courtesy of unelected judges” that circumvented the legislature.

The Hively decision was issued about a week after a three-judge panel for the U.S. Court of Appeals for the Second Circuit held that it did not have the power to extend Title VII to sexual orientation discrimination, absent a ruling by the full Second Circuit or the U.S. Supreme Court.  Similarly, on March 10, 2017, a three-judge panel for the U.S. Court of Appeals for the Eleventh Circuit also held that it was bound by existing precedent stating that Title VII does not protect LGBT employees.

As a result of the Hively decision, there is now a split among federal courts of appeal as to whether Title VII prohibits workplace discrimination based on sexual orientation, setting the stage for the Supreme Court to address the issue at some point in the future. In the meantime, employers should be aware of state and local anti-discrimination laws, such as the New Jersey Law Against Discrimination and the Philadelphia Fair Practices Ordinance, which provide specific protections against sexual orientation discrimination. Employers may also benefit from enacting and enforcing workplace policies prohibiting discrimination based on sexual orientation and gender identity, which serve both to protect employers from liability, and to foster a more inclusive workplace.  Employers who are unsure if their policies and procedures meet state, federal and local guidelines should seek the advice of experienced employment counsel.

About the Authors

Ivo Becica

Ivo J. Becica


Ivo is a partner in Obermayer’s Labor Relations & Employment Law Department. He focuses his practice on representing employers, including advising companies on how to handle employee issues, and defending employee claims...

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