The Eleventh Circuit Court of Appeals has released a decision which highlights the difficulties employers face in disciplining transgender employees.  Chavez v. Credit Nation Auto Sales, LLC, No. 14-14596, 2016 WL 158820 (11th Cir. Jan. 14, 2016.).  Chavez alleged that she was terminated from employment as a mechanic because she is a transgender person.  Credit Nation responded that she was terminated because she slept for 40 minutes on-the-clock in a customer’s vehicle.  The Court ruled that Credit Nation possessed a permissible reason for terminating Chavez, and affirmed dismissal of her claims for back pay and reinstatement.  Nevertheless, the Court also found that Chavez presented sufficient evidence to show that her gender was a “motivating factor” in her termination, even though sleeping-on-the-job was a legitimate motivating factor as well.  Chavez’s evidence of gender discrimination included:  (1) the President of Credit Nation told Chavez that he was “very nervous” about her gender transition and the “possible ramifications”; (2) the President told Chavez that she was going to “negatively impact his business”; (3) the President asked Chavez not to wear a dress back and forth to work; (4) a Vice-President told Chavez to “tone it down” and be “very careful” because the President “didn’t like” the implications of Chavez’s gender transition; and, (5) Credit Nation deviated from its “normal” progressive discipline policy in terminating Chavez.  The Eleventh Circuit remanded the case for a trial on whether Chavez’s transgender status was a motivating factor in the employment decision.

Chavez is the latest example of the difficult terrain that an employer must navigate when making decisions that affect Lesbian, Gay, Bisexual and Transgender employees. After Chavez, it is now well-established in the Eleventh Circuit (which reviews cases from Alabama) that sex discrimination under Title VII of the Civil Rights Act of 1964 includes discrimination against a transgender person for gender nonconformity.  In short, as a general rule, transgender employees are protected by Title VII.

In contrast, the general rule is that sexual orientation (i.e., gay or bisexual) is not a protected characteristic under Title VII.  Nevertheless, any lawyer will tell you that there are always exceptions to a general rule.  For example, the Supreme Court has clearly held that same-sex sexual harassment is prohibited by Title VII.  Additionally, there is some authority in the Eleventh Circuit indicating that discrimination on the basis of “nonconformity to gender stereotypes” might be actionable under Title VII.  See Glenn v. Brumby, 663 F.3d 1312 (11th Cir. 2011), but see EEOC v. McPherson Companies, Inc., 914 F.Supp.2d 1234 (N.D. Ala. 2012)(finding there must be “obvious gender non-conformity”).

The federal government is attempting to insert itself into these uncertain waters.  President Obama issued Executive Order 13672 which explicitly prevents federal contractors from discriminating on the basis of sexual orientation or gender identity.  Additionally, the EEOC has taken the position that discrimination on the basis of sexual orientation is sex discrimination under Title VII.

In short, the law is in a state of flux with regard to LGBT issues.  Proceed carefully before making employment decisions based upon LGBT status.