Creating a split with courts of appeals around the country with its ruling in Hively v. Ivy Tech Community College of Indiana, the Seventh Circuit became the first circuit court to hold that Title VII’s prohibition of sex discrimination applies to discrimination on the basis of sexual orientation. The reasoning of Hively shows that Title VII also prohibits discrimination against employees on the basis of gender identity and foreshadows that the Seventh Circuit will soon protect transgender students under Title IX in Whitaker v. Kenosha Unified School Dist. No. 1, No. 16-3522 (7th Cir.).

Hively recognizes that sexual orientation discrimination is sex discrimination

In Hively v. Ivy Tech Comm. Coll. of Indiana, No. 15-1720, 2017 WL 1230393 (7th Cir. Apr. 4, 2017), the Seventh Circuit, sitting en banc, held that sexual orientation discrimination in employment is a subset of sex discrimination, and thus barred by Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e-2(a). The court revived the complaint of plaintiff Kimberly Hively in which she alleged she was fired from a part-time job and not hired for multiple full-time positions because she is a lesbian. The majority opinion, written by Judge Diane Wood, reasoned first that if all facts were the same but her sex—that is, if plaintiff had been a man married to a woman—she would have been hired, and thus had suffered “paradigmatic sex discrimination.” Hively at *5. The court also concluded that sexual orientation discrimination “represents the ultimate case of failure to conform to the female stereotype,” Id., and that a claim of sexual orientation discrimination is a gender nonconformity case squarely within the logic of Price Waterhouse v. Hopkins, 490 U.S. 228 (1989) (holding that discrimination for failing to conform to a gender stereotype is sex discrimination).

The court in Hively further reasoned that Title VII bans associational discrimination (i.e. discrimination based on the trait of a person the employee associates with) under the logic of Loving v. Virginia, 388 U.S. 1 (1967), regardless whether the trait at issue is race, sex, or any other protected trait. Hively, at *6-7. From this view, sexual orientation discrimination is also “sex” discrimination because it turns on the sex of the employee’s partner.

Hively indicates that Title VII also protects transgender employees against discrimination

Under the reasoning of the Hively opinion, “sex” discrimination also prohibits employment discrimination against transgender individuals. While Hively formally reserved the issue of gender identity discrimination, Id. at n.1, the court’s reasoning leaves little doubt that Title VII protects transgender employees.

First, Hively abrogates the Seventh Circuit case that limited Title VII protection for transgender individuals: Ulane v. Eastern Airlines, Inc., 742 F.2d 1081 (7th Cir. 1984). Hively criticizes Ulane’s antiquated conclusion that Title VII only covers discrimination “against women because they are women and against men because they are men.” Hively, at *1. The opinion also explicitly rejects Ulane’s core reasoning. Courts cannot look to the understanding of “sex” at the time Title VII was passed in 1964 or unsuccessful attempts to amend Title VII to limit the scope of “sex” claims. Id. at *3-5. They must instead consider what “sex” means in Title VII today, “not what someone thought it meant one, ten, or twenty years ago.” Id. at *9.

Second, Hively instructs courts to identify sex discrimination by considering the situation: if everything else were the same but the sex of the plaintiff was different, would the employer have acted differently? In the case of a transgender employee, the answer is yes. Consider an employee whose sex assigned at birth was male, identifies as female, and was fired for being transgender. If her “sex” was changed such that her gender identity matched her sex assigned at birth, she would not have been fired. Because changing the sex changes the outcome, discrimination based on gender identity is sex discrimination.

Third, transgender individuals are protected by gender nonconformity cases stemming from Price Waterhouse v. Hopkins, 490 U.S. 228 (1989), because their sex assigned at birth does not match their gender identity. Hively, at *5.

Fourth, Hively recognizes that a person’s sex, for purposes of Title VII, encompasses their gender identity, stating that sex discrimination occurs when the discriminatory behavior turns on “the victim’s biological sex (either as observed or as modified, in the case of [transgender individuals]).”

Moreover, the conclusion that Title VII bars discrimination against transgender employees is supported by the EEOC and cases from other circuits that prohibit gender identity discrimination as sex discrimination. See, e.g., Hively at *8 (collecting cases); Glenn v. Brumby, 663 F.3d 1312 (11th Cir. 2011); Smith v. City of Salem, Ohio, 378 F.3d 566 (6th Cir. 2004); Rosa v. Park W. Bank & Tr. Co., 214 F.3d 213 (1st Cir. 2000); Schwenk v. Hartford, 204 F.3d 1187 (9th Cir. 2000).

With Ulane’s reasoning replaced by that of Hively, Title VII should encompass claims of discrimination based on gender identity in the Seventh Circuit. Just as there is no “line” between sex discrimination and sexual orientation discrimination, there should be no line between sex discrimination and gender identity discrimination. Hively, at *5.

Hively’s Implications for Schools and Title IX

In addition to providing protections in the employment context, the court’s ruling in Hively sets the groundwork to extend Title IX to protections for transgender students. Title IX proscribes discrimination “on the basis of sex” in educational programs that receive federal funds. 20 U.S.C. § 1681(a). Months ago, it was recognized that Hively would likely “shed important new light on the questions of whether the term ‘sex’ as used in Title VII, and by implication in Title IX, encompasses gender identity.” Students and Parents for Privacy, v. United States Dep’t of Educ., 16-cv-4945, 2016 WL 6134121 (N.D. Ill. Oct. 18, 2016). This is unsurprising as courts routinely rely on Title VII cases to interpret the scope of Title IX. See, e.g., Olmstead v. L.C. ex rel. Zimring, 527 U.S. 581, 617, n.1 (1999).

Although the United States Supreme Court—in Gloucester County School Board v. G.G., No. 16-273—recently declined to decide whether Title IX’s prohibition of sex discrimination includes discrimination based on gender identity, the issue is currently before the Seventh Circuit in Whitaker v. Kenosha Unified School District No. 1, No. 16-3522 (7th Cir. 2017). In Whitaker, a transgender student challenged his school’s rule that he use the restroom that corresponds with the gender marker on his birth certificate under Title IX and the Equal Protection Clause.

When Whitaker was argued in the Seventh Circuit on March 29, 2017, the Court described the school district’s position as a “separate but equal argument” and stated that the restroom ban had “everything to do with sex.” Notably, Whitaker was heard by Judges Wood, Rovner, and Williams, all of whom signed onto the majority en banc opinion in Hively.

The Seventh Circuit could also rule in favor of the transgender student under the Equal Protection argument, as did a judge recently in Pennsylvania. In Evancho v. Pine-Richland Sch. Dist., No. 2:16-01537, 2017 WL 770619 (W.D. Penn. Feb. 27, 2017), the court applied intermediate scrutiny and preliminarily enjoined under the Equal Protection Clause a school district’s policy that required transgender students to use a single stall restroom or restrooms corresponding with their sex assigned at birth.

On the heels of Hively, the Seventh Circuit is poised to apply the same reasoning to conclude that sex discrimination in schools includes discrimination on the basis of gender identity under Title IX.

Between Whitaker and Hively, transgender and gender expansive students and employees in the Seventh Circuit should soon have a strong basis to assert under federal law that they cannot be treated differently from others on the basis of their sex, including their gender identity and nonconformity to sex stereotypes. 