As many states enter phases I and II of re-opening despite the still present Federally determined Outbreak Period, the Supreme Court is also busy in session. On June 15, the Court rendered a decision in three consolidated cases, for which they heard arguments back in October (Bostock v Clayton County Georgia, Altitude Express Inc v Zarda , and Harris Funeral Homes, Inc v EEOC). The common challenge across the cases was raised by employees citing their terminations as being ‘on the basis of’ their sexual orientation or gender identity. 

The Court found in favor of the plaintiffs, ruling that termination of employment because of sexual orientation or gender identity is wrongful termination within the meaning of Title VII. Specifically, the decision syllabus states the following:

“Because discrimination on the basis of homosexuality or transgender status requires an employer to intentionally treat individual employees differently because of their sex, an employer who intentionally penalizes an employee for being homosexual or transgender also violates Title VII.” 

“Discrimination based on homosexuality or transgender status necessarily entails discrimination based on sex; the first cannot happen without the second.”

HHS has also been busy. Section 1557 of the Affordable Care Act ‘prohibits discrimination on the basis of race, color, national origin, sex, age, or disability in certain health programs or activities’. In 2016, Section 1557 was addressed by HHS in a final rule. This was later repealed, and this week a new final rule replaces the 2016 version. The current version of the rule is narrower in scope than the 2016 rule, and defines discrimiantion ‘on the basis of sex’ to refer to gender assignment at birth. 

The main takeaway for employer health plan sponsors is that Section 1557 does not apply to self funded employer health plans. The rule only applies to  ‘health programs or activities, any part of which receive federal financial assistance and any from or activity under Title I of the ACA.’ The final rule can be viewed in its entirety here. An HHS summary sheet is located here.

The Supreme Court decision broadens nondiscrimination protections for employees in the workplace. The HHS final rule limits the scope of nondiscrimination protections under Section 1557 to ‘the basis of sex’ as determined by gender assignment at birth only. There are likely to be more legal challenges to this narrower rule in the coming months.