Successful religious freedom defense in Title VII case brought by transgender employee

In yesterday's EEOC v. R.G. & G.R. Harris Funeral Homes, Inc. decision, a federal district court held in favor of an employer who was sued under Title VII by the Equal Employment Opportunity Commission for firing a male-to-female transgender employee. The employer, a funeral home, required male employees to wear traditional male suits and required female employees to wear skirt-suits. When the employee insisted on wearing skirt-suits, as part of the process of transitioning from male (Andrew Stephens) to female (Amiee Australia Stephens), the employer dismissed the employee; the EEOC claims that this was sex discrimination. I think the decision is wrong, but for complicated reasons; I hope you can bear with me while I try to lay them out.

1. To begin with, let's understand the core Title VII legal theory that the court saw as involved in this case. Title VII doesn't on its face ban discrimination against people who are transgender; it bans discrimination based, on among other things, sex. But courts have held (correctly, I think) that this ban includes the employer engaging in "sex-stereotyping" practices, which is to say treating men and women differently based on expectations of how the different sexes should behave. For instance, in the leading Supreme Court precedent on this theory, Price Waterhouse v. Hopkins (1989), Ann Hopkins argued that Price Waterhouse passed her over for partnership not just because she was a woman (Price Waterhouse did have some female partners) and not just because she was seen as aggressive (Title VII doesn't ban discrimination based on such traits), but also because she was seen as an aggressive woman, and was judged harshly for this in a way that aggressive men were not. Title VII violation, the court held: The employer generally can't have one standard of proper behavior for male employees and another for female employees.

Now where does this leave sex-specific dress codes (and related grooming standards, such as for hair length, jewelry and makeup)? In the 1970s, courts generally concluded that sex-specific dress codes, at least so long as they followed traditional standards of professional dress, didn't violate Title VII, because Congress couldn't have intended to displace such well-accepted—and, in the courts' view, harmless—different treatment. Indeed, Barker v. Taft Broadcasting Co. (1977) so held in the 6th Circuit, which is where the Harris Funeral Homes case is being litigated; other courts, cited by Barker, had held the same. And in 2006, an 11-judge en banc panel of the 9th Circuit agreed with that view, upholding a policy that required women to wear some makeup and banned men from wearing any. (The vote was 7-4; for those who count such things, the majority upholding the sex-based grooming policy consisted of four men and three women, and the dissenters were three men and one woman.)

But the 6th Circuit, in Smith v. City of Salem (2004), said that "After Price Waterhouse, an employer who discriminates against women because, for instance, they do not wear dresses or makeup, is engaging in sex discrimination because the discrimination would not occur but for the victim's sex." And based on this, the district judge in the case we're discussing likewise concluded that sex-specific dress codes normally violate Title VII, and that it would normally be illegal for Harris to fire Stephens for insisting on wearing clothing that Harris saw as not male-appropriate.

2. But then came the Religious Freedom Restoration Act, through which Congress required courts to give religious exemptions even from generally applicable federal statutes. The rule is that if (A) an objector has a sincere religious belief and (B) a federal law substantially burdens the objector's ability to act consistently with that belief, then the government must grant an exemption from the law unless (C) the law serves a compelling government interest and (D) denying the exemption is the least restrictive means of serving that interest. (More on that in this post.) The court concluded, I think rightly, that the RFRA applies to Title VII just as it does to other federal statutes, though, as with other federal statutes, exemptions from Title VII can still be denied if "strict scrutiny" (the legal term for elements C and D of the test above) is satisfied.

A. Harris is a family-owned corporation, with 94.5 percent of the shares owned by Thomas Rost and the rest by his children. And (paragraph break added)

Rost believes "that the Bible teaches that God creates people male or female." He believes that "the Bible teaches that a person's sex is an immutable God-given gift and that people should not deny or attempt to change their sex." Rost believes that he "would be violating God's commands" if he were to permit one of the Funeral Home's funeral directors "to deny their sex while acting as a representative of [the Funeral Home].

This would violate God's commands because, among other reasons, [Rost] would be directly involved in supporting the idea that sex is a changeable social construct rather than an immutable God-given gift." Rost believes that "the Bible teaches that it is wrong for a biological male to deny his sex by dressing as a woman." Rost believes that he "would be violating God's commands" if he were to permit one of the Funeral Home's biologically-male-born funeral directors to wear the skirt-suit uniform for female directors while at work, because Rost "would be directly involved in supporting the idea that sex is a changeable social construct rather than an immutable God-given gift."

There was no dispute about the sincerity of Rost's beliefs; the EEOC expressly declined to argue that Rost was insincerely claiming religious beliefs that he didn't actually hold.

B. The court concludes that requiring Rost to have Stephens wear a skirt-suit on the job would thus indeed substantially burden's Rost ability "to conduct business in accordance with [his] religious beliefs," quoting the Supreme Court's Hobby Lobby decision. This is itself a controversial holding, though I'm inclined to think that it's correct, when it comes to employees who are representing the employer to customers; I'll set that aside here, though, except with a hypothetical: Imagine that a Quaker who opposed deadly self-defense (not all do, I think, but some do) runs a business in a state which (hypothetically) requires employers to let employees open-carry guns on the job. The Quaker objects because he says that the employees, when interacting with customers, represent him as the employer, and their wearing guns while interacting with customers burdens his ability to run a business that is consistent with his pacifist beliefs. Do you think that would substantially burden the employer's religious beliefs (whether or not you think that the government has a compelling interest that can justify such a burden)?

C. Because a court finds that there is a substantial burden on Rost's beliefs, the court must then ask whether applying Title VII to Rost's actions is nonetheless necessary to a compelling government interest. This question had come up before with regard to employment discrimination bans, in the 1970s and 1980s (before the RFRA, but under the old 1963-to-1990 Free Exercise Clause rules that the RFRA was meant to restore); and courts uniformly said that—setting aside employers that are themselves religious institutions—antidiscrimination law could apply, because there's such a compelling interest in protecting employees from losing their livelihoods based on race, sex and the like. And here too the court assumes without deciding that the EEOC has a compelling interest in "protecting employees from gender stereotyping in the workplace."

D. But the court holds in favor of Harris, because "The EEOC's briefs do not contain any indication that the EEOC has explored the possibility of any accommodations or less restrictive means that might work under these facts." But what might these less restrictive means be? A gender-neutral dress code: "The EEOC has not even discussed such an option, maintaining that Stephens must be allowed to wear a skirt-suit in order to express Stephens's gender identity. If the compelling governmental interest is truly in removing or eliminating gender stereotypes in the workplace in terms of clothing (i.e., making gender "irrelevant"), the EEOC's chosen manner of enforcement in this action does not accomplish that goal."

In particular, the court asks,

Couldn't the EEOC propose a gender-neutral dress code (dark-colored suit, consisting of a matching business jacket and pants, but without a neck tie) as a reasonable accommodation that would be a less restrictive means of furthering that goal under the facts presented here? Both women and men wear professional-looking pants and pants-suits in the workplace in this country, and do so across virtually all professions.

[Footnote: [This would be s]imilar to the gender-neutral pants, business suit jackets, and white shirts that the male and female Court Security Officers in this building wear.]

Yet I don't see how that can justify throwing out the EEOC's case, because even under the court's proposed less restrictive alternative, Harris was still guilty of violating Title VII. Harris could have responded to Stephens's request to wear a skirt-suit by implementing precisely the policy that the court recommends—but it didn't. Indeed, Harris could have responded to the injunction that the EEOC sought in its complaint ("enjoining Defendant Employer . . . from engaging in any unlawful practice which discriminates against an employee or applicant because of their sex, including on the basis of gender identity"), by implementing precisely that policy. The court's proposed less restrictive alternative isn't less restrictive of religion in this respect than Title VII as written.

And the EEOC has a claim on Stephens's behalf for lost income, as well as compensatory damages. If the court's proposed less restrictive alternative is that Harris should just implement a gender-neutral dress policy going forward, that alternative wouldn't serve the interest in compensating Stephens for what the court concludes is sex discrimination. And if the court's proposed less restrictive alternative is that Harris should have been allowed to implement a gender-neutral dress policy at the time Stephens insisted on wearing a skirt-suit, that alternative was already available to Harris at the time: Harris could have implemented such a policy when Stephens complained, or at any time before then, but didn't want to.

Now perhaps I'm missing something, but it seems to me that the court just didn't apply strict scrutiny correctly here. One defense of the RFRA has long been that the law wouldn't undermine really important government interests, since if applying a federal law really is the least restrictive way of serving a compelling interest, the federal government can do that. But this decision seems inconsistent with the defense; and, if followed by other courts, can indeed end up undermining Title VII and other federal laws.

3. One odd twist: For complicated reasons related to particular phrases in Title VII, some federal courts (including the 6th Circuit) have held that the RFRA doesn't apply to lawsuits brought by nongovernment entities (as opposed to criminal prosecutions, lawsuits brought by the government, or enforcement actions by the government). I think that's likely mistaken for reasons discussed near the end of this post from Prof. Doug Laycock; courts have long recognized that First Amendment rights are implicated by private parties' lawsuits that seek enforcement of government-created rules by government-run courts (see, e.g., New York Times v. Sullivan and Hustler v. Falwell), and that is likely one of the principles that Congress sought to embody in the RFRA, which was aimed at restoring the 1963-to-1990 First Amendment Free Exercise Clause jurisprudence. Nonetheless, this doesn't matter here, because here—unlike in most employment discrimination cases—a federal agency, the EEOC, was suing on behalf of the plaintiff:

This Court recognizes that this appears to produce an odd result. Under existing Sixth Circuit precedent, the Funeral Home could not assert a RFRA defense if Stephens had filed a Title VII suit on Stephens's own behalf because no federal agency would be a party to the case. But, because this is one of those rare instances where the EEOC (a federal agency) chose to bring suit on behalf of an individual, a RFRA defense can be asserted.