The Equal Employment Opportunity Commission ("EEOC") has ruled that Title VII protects employees who are discriminated against because they are transgender. In its decision, the EEOC concluded that "intentional discrimination against a transgender individual because that person is transgender is, by definition, discrimination 'based on … sex' and such discrimination … violates Title VII."
The ruling came as a result of a discrimination complaint by Mia Macy, a transgender woman who was denied a job as a ballistics technician at the Walnut Creek, California laboratory of the federal Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF). Ms. Macy, a veteran and former police detective, initially applied for the position as male and was told that she virtually was guaranteed the job. After disclosing her gender transition mid-way through the hiring process, Ms. Macy was told that funding for that position had been suddenly cut. She later learned that someone else had been hired for the job.
Ms. Macy filed a discrimination charge against the Bureau, alleging sex discrimination, and discrimination on the basis of gender identity (as a transgender woman) and sex stereotyping. When only her sex discrimination claim was accepted, however, Macy appealed.
The Commission reversed the decision, concluding that discrimination claims based on transgender status or gender identity are covered under Title VII. The Commission based its conclusion principally upon the United States Supreme Court's decision in Price Waterhouse v. Hopkins, 490 U.S. 228 (1989) and subsequent decisions by federal courts. In Price Waterhouse, the Supreme Court held that discrimination on the basis of gender stereotype (e.g., a woman denied partnership in a company because she was too "macho" and not "feminine" enough) is sex-based discrimination prohibited under Title VII.
Several United States Circuit Courts of Appeals have subsequently held that under this holding, Title VII bars "not just discrimination because of biological sex, but also gender stereotyping—failing to act and appear according to expectations defined by gender." Following this approach, the Commission reasoned that when an employer discriminates against someone because the person is transgender, the disparate treatment is "related to the sex of the victim." According to the Commission, this includes a person allegedly discriminated against for expressing his or her gender in a non-stereotypical fashion, and a person allegedly discriminated against because an employer is uncomfortable with or dislikes the fact that he or she has or is transitioning from one gender to another.
