by Sarah E. Stuart
On October 8, 2019, the Supreme Court heard oral argument in three cases to determine whether Title VII of the Civil Rights Act of 1964—which bars employment discrimination on the basis of sex—protects gay, lesbian, and transgender employees. While 21 states and the District of Columbia bar LGBT discrimination in employment, thus far the federal Courts of Appeals are split on whether existing federal law extends to bar employment discrimination on the basis of gender identity and/or sexual orientation. Many employers opt to include LGBT employees in non-discrimination policies; however, the outcome of these cases will likely determine whether such protections are mandated by federal law.
The three cases being considered by the court have separate but related issues.
In Bostock v. Clayton County, Georgia, No.17-1618, the Court considered the termination of a gay man who worked for Clayton County, Georgia, for 10 years, having received positive performance evaluations and accolades. After joining a gay recreational softball league in 2013, Bostock began to receive criticism based on his sexual orientation. Soon thereafter, he was terminated by Clayton County for “conduct unbecoming of its employees.” Bostock was heard at argument by the Court along with Altitude Express v. Zarda, No. 17-1623, involving a terminated skydiving instructor who had mentioned his sexual orientation to reassure a female client who had objected to being strapped against him while participating in tandem skydives in Long Island, New York.
Both cases consider the question: Does Title VII of the Civil Rights Act of 1964, which prohibits against employment discrimination “because of . . . sex” encompass discrimination based on an individual’s sexual orientation?
The third case, heard separately on the same day, is an appeal from the Sixth Circuit Court of Appeals, which governs Tennessee. In R.G. & G.R. Harris Funeral Homes Inc. v. EEOC, 18-107, a funeral director at R.G. & G.R. Harris Funeral Homes, Inc., informed her employer of her intent to transition from male to female, shortly after which she was terminated, admittedly because the employer was worried that her appearance would upset bereaved customers. The Equal Employment Opportunity Commission (EEOC) brought suit on behalf of Aimee Stephens, charging that Stephens’ termination violated Title VII. The Sixth Circuit Court of Appeals held that the termination based on her transgender status constituted sex discrimination, making it the law of the land for employers based in Tennessee.
The Court will consider whether Title VII prohibits discrimination (1) based on an employee’s status as transgender or (2) based on sex stereotyping.
Oral argument is often a tell for which way justices on the Court may lean in their later rulings. Despite lengthy argument, however, it is unclear how the Supreme Court will rule. The closely related issues of sexual orientation discrimination and gender identity discrimination divided the Court. Justices inquired about whether Congress could have possibly intended to bar employment discrimination based on sexual orientation in 1964—countered by counsel that sexual harassment was likewise not considered covered by Title VII in 1964 but is recognized and protected now. Issues such as sex-specific dress codes, bathrooms, religious objections, and the implications on Title IX and athletics were raised. Justice Breyer compared firing a member of a gay couple to firing a Catholic employee for marrying a Jewish person.
In a wide-ranging argument with a host of hypothetical scenarios, the justices were divided along ideological lines. Justice Neil Gorsuch may well be the swing vote on these cases. At argument, Justice Gorsuch repeatedly pushed against counsel for employers on whether there is a real distinction between sex and sexual orientation. In the argument in Harris, however, he contemplated that “massive social upheaval” may make it more appropriate for Congress to determine this issue. The Court’s decision will come down to whether there is a distinction between sex and sexual orientation or identity.
Approximately 11.3 million people in the United States are gay, lesbian, bisexual, or transgender, so the outcome of these cases will have considerable impact on both workers and employers. The basic protections of Title VII may well be extended nationwide to those persons, meaning employers that do not already have policies considering employment issues particular to the LGBT community will need to reevaluate accordingly. Employers should continue to pay attention to the status of these cases.
By Lisa A. Krupicka
It is tempting to draw the line and say that an employee who has been approved for FMLA leave simply cannot be fired. Firing someone on leave seems like handing him or her the proverbial stick to beat you with. However, the FMLA is not a shield behind which a poor-performing employee can hide. With the right approach and documentation, employers can take action to address serious poor performance without inviting a costly and time-consuming lawsuit.
First, you have to have a clear and well-documented case of a firing offense. It does not have to be one isolated serious incident. It can be the culmination of a series of performance issues that have finally created a situation that can no longer be tolerated. But it must be serious enough for a reasonable person to agree that the employee should be fired (as opposed to merely disciplined or counseled), and sufficiently well-documented that a reasonable person would be unlikely to believe it was fabricated or exaggerated.
You also need to examine the situation very carefully to determine if the request for leave played any part in the desire to terminate the employee. It is not unusual for a manager to tolerate a low-performing employee but then to be ready to fire that employee because she asked for leave: “We’re already half-carrying her and now we have to cover for her? She’s got to go!”
If you have satisfied yourself that the request for leave played no part in the desire to terminate, your next decision is the timing of the termination. Do you terminate the employee before he goes on leave or when he comes back?
This is a close call, but I say: Do it right away. The more time passes between your discovery of the performance issue and termination, the stronger the argument becomes that the leave had something to do with it. You might be tempted to wait until after the leave is over to allow the employee to hold on to his health insurance coverage at least until the end of the leave or on the off chance that the employee cannot return from leave and so the issue will be moot. On the other hand, the employee may come back with restrictions or need more leave as an accommodation, so you will have handed the employee yet another stick to beat you with. Isn’t this fun?
Keep in mind that unless you are willing to wait a year or more to fire the employee after she returns from leave, waiting until the leave is over is not going to sever the implied connection between the leave request and the termination. If you think about it and decide that, actually, you could wait that long, maybe you did not have a good enough reason to terminate in the first place.
Let our team help you decide your leave law issue. Or if you have a leave law issue that you would like me to address in this column, email me at email@example.com.
by Gary S. Peeples
Prepaid debit cards offer advantages to both employees and employers. For employees who do not maintain bank accounts, receiving a prepaid debit card from an employer saves the employee a trip to a bank (if he or she can even find a bank that will cash a check for a non-customer) or a check-cashing store. A survey conducted by the FDIC in June 2017 showed that 6.5 percent of United States households are unbanked, meaning that the households do not hold any account at a federally insured banking institution. Prepaid debit cards are thus more convenient to unbanked employees than physical paychecks. For employers, issuing prepaid debit cards represents a cost savings over issuing paper checks.
Employers outside of Tennessee have occasionally faced lawsuits challenging the practice of issuing prepaid debit cards instead of physical paychecks. The most prominent example of such a lawsuit involved a McDonald’s franchisee in Pennsylvania; in that suit, a former employee contended that the franchisee’s policy of paying employees with prepaid debit cards violated Pennsylvania’s wage payment law. That lawsuit, which was certified as a class action, settled for nearly $1,000,000 in October 2017.
Does Tennessee law permit employers to issue prepaid debit cards to employees in lieu of physical paychecks? The answer is “yes,” with some caveats. In 2010, the Tennessee legislature amended Tennessee’s wage payment statute to permit Tennessee employers to pay their employee using prepaid debit cards. The caveats are these: (1) employees must have the ability to make at least one withdrawal or transfer every pay period—for any amount contained on the card, including the entire balance—without any associated fee for doing so; (2) employees must be given the choice of being paid by prepaid debit card or by electronic transfer (i.e., direct deposit); and (3) employers must provide full written disclosures to employees regarding any fees associated with the prepaid debit cards. If these requirements are met, then a Tennessee employer may lawfully pay its employees using prepaid debt cards.
Physical paychecks, meanwhile, can be relegated to the dustbin of history.