Transgender Employees

The usual first step for companies interested in implementing a more transgender-inclusive workplace is to codify gender identity protection within their non-discrimination policies. Unlike those legislatures that have obtusely subsumed gender identity under another protected category, the easier method for employers is to include gender identity (and gender expression) explicitly as a protected category alongside sex, race, religion, age, disability and the like. It should also be noted that in those jurisdictions where the state and/or municipality protects transgender people from discrimination in private employment, employers who have included in their polices a catch-all category such as 'any other legally protected class' are already indirectly (and perhaps unwittingly) covering gender identity in their policies. Providing gender identity equal footing with the other protected categories, however, makes it clear that the company is in compliance and can serve to underscore the company's commitment to its current and prospective transgender employees.

Once they have included gender identity in their non-discrimination policies, employers may wonder what else they should do to ensure an inclusive environment for their transgender employees. Companies that were able to address the needs of their gay and lesbian employees simply by adding sexual orientation to their non-discrimination policies and perhaps supporting formation of an in-house GLBT affinity group may be surprised to learn that addressing the needs of the transgender employee is typically not so straightforward. For such employers, the HRC Foundation provides several policy recommendations, such as incorporating education about transgender issues into diversity training programs, establishing written guidelines for supporting those in transition, and extending wellness-related benefits to transgender employees. (HRC Foundation has made available online the transgender workplace transition guidelines for oil and gas company Chevron Corporation and accounting firm Ernst & Young LLP (E&Y), which are referenced below.) It is in the implementation of such policy changes that many employers feel challenged.

Restroom and Locker Room Considerations

On a practical level, one of the most important issues that companies with transgender employees in transition face is those employees' access to restroom facilities. While the availability of a unisex, single-occupancy restroom is seen by the transgender community as the optimal solution to the situation, it may not be practical for a company to retrofit a single-occupancy restroom into its existing workplace. Consequently, Human Resources may be asked to implement a policy specifying which gender restroom a transgender employee should use. In doing so, it must determine at what point the company should consider an employee in transition to have assumed his or her reassigned gender: once the employee begins to assume the role, once the employee files a legal name change, or only once the employee has fully transitioned. Chevron has taken the position that a transgender employee should use the restroom of his or her birth-assigned gender until transition is complete. In contrast, E&Y considers the inflection point to be when the employee begins to assume the role of his or her reassigned gender in everyday life. This issue of an employer restroom policy has even led to litigation initiated by a transgender employee. In Goins v. West Group, a male-to-female transgender person sued her employer for discrimination because the company denied her access to the women's restroom. The Supreme Court of Minnesota held that the employer designation of employee restroom use based on biological gender did not violate the state's anti-discrimination laws. 635 N.W.2d 717 (Minn. 2001). In Minnesota, at least, an employer has discretion in setting its restroom policy.

Instituting a policy like E&Y's, however, may lead to considerable unease among non-transgender employees. In 2002, a female teacher in Minnesota sued her school district and principal, alleging that they had discriminated against her on the basis of her sex and religion by allowing a transgender coworker to use the women's faculty restroom. Cruzan v. Special Sch. Dist. #1, 294 F.3d 981 (8th Cir. 2002). Although the Eighth Circuit Court of Appeals affirmed the lower court's dismissal of the claim, this case highlights the discomfort that some employees may feel about any such restroom policy. The same concern for privacy at the heart of the restroom issue similarly (or perhaps to an even greater extent) applies with respect to workplace changing rooms and locker rooms. In Opilla v. Parker, a female employee in New Jersey filed a suit alleging sexual harassment and a hostile work environment against her employer Lucent Technologies (among others) because an on-premises health center provided by Lucent (but operated by a separate corporate entity) allowed a transgender colleague to use the women's locker room. The state appellate court affirmed the lower court's dismissal of the plaintiff's claims, finding that the isolated incident had not created a hostile work environment. 2006 WL 2787047 (N.J. Super. Ct. App. Div. Sept. 29, 2006). The lesson to take away from these cases is that employers must be sensitive to, and plan for, potential confusion and unease in the workplace that may result from implementing special policies intended to support transgender employees. Educating all employees about the rationale for those policies, such as by widely disseminating workplace transition guidelines and providing support groups and counseling for employees to discuss their discomfort, may help to alleviate some problems.

Equal Wellness Benefits

The availability of relevant medical care, such as hormone therapy, mental health counseling, and surgical procedures related to sex reassignment, is another pressing concern for most transgender people. Yet, even companies that seek to extend equal benefits coverage to their transgender employees can be constrained by external factors, such as the explicit exclusions that most private medical insurance providers have instituted for procedures related to transitioning. Likewise, short-term disability for those recovering from sex reassignment surgery may not be available to employees in transition if the benefit provider has a blanket policy of classifying such surgery as elective or cosmetic, regardless of whether the surgery has been indicated by a physician as a medical necessity. Although some insurers provide the option for employers to include coverage for gender identity-related treatments in their insurance plans, others offer no such flexibility, leaving employers under those plans with their hands tied. Thus, unless their employers change benefit providers, comprehensive medical benefits for most transgender employees may be hard to come by, even with non-discrimination policies and workplace transition guidelines in place.

Conclusion

The issue of including gender identity in non-discrimination policies is expected to continue to develop, as legal protections increase and transgender employees feel more comfortable being open about their status in the workplace. Nevertheless, including gender identity as a protected category in their non-discrimination policies, while an appropriate and positive step, should not be viewed by employers as the end goal. The true challenges lie in the establishment of an inclusive environment for transgender employees to enjoy equal opportunities pursuant to those policies. External constraints beyond the commitment of the employer and other employees may continue to limit the ability of even the most progressive companies to offer transgender employees access to and benefits on par with those of non-transgender colleagues. Most employers have work to do to adjust their policies and workplace environment to support transitioning employees, and in an increasing number of jurisdictions, employers that fail to do so may find themselves in violation of the law.

John D. Shyer, a member of this newsletter's Board of Editors, is a labor and employment law partner in the New York office of Latham & Watkins LLP. Toshi Kameoka is an associate in the firm's San Francisco office.

Part one of this article explained the terminology and discussed some of the challenges employers face in treating transgender employees in a nondiscriminatory manner.

Implications for Employers

Likely influenced by the changing legal climate for transgender persons, some U.S. corporations have, in recent years, taken steps to provide a more inclusive environment for transgender employees. The HRC Foundation, which tracks the GLBT (Gay, Lesbian, Bi-sexual, Transgender)-friendliness of employers, currently identifies 122 of the Fortune 500 as having non-discrimination policies that include gender identity, along with 137 smaller private sector companies. HRC Workplace Project Database, www.hrc.org/worklife/pdsearch (last visited Mar. 23, 2007). The fact that so many recognizable corporate names have deemed it in their best interests to implement policies to protect their transgender employees will likely influence other employers to consider whether they should follow suit.

The usual first step for companies interested in implementing a more transgender-inclusive workplace is to codify gender identity protection within their non-discrimination policies. Unlike those legislatures that have obtusely subsumed gender identity under another protected category, the easier method for employers is to include gender identity (and gender expression) explicitly as a protected category alongside sex, race, religion, age, disability and the like. It should also be noted that in those jurisdictions where the state and/or municipality protects transgender people from discrimination in private employment, employers who have included in their polices a catch-all category such as 'any other legally protected class' are already indirectly (and perhaps unwittingly) covering gender identity in their policies. Providing gender identity equal footing with the other protected categories, however, makes it clear that the company is in compliance and can serve to underscore the company's commitment to its current and prospective transgender employees.

Once they have included gender identity in their non-discrimination policies, employers may wonder what else they should do to ensure an inclusive environment for their transgender employees. Companies that were able to address the needs of their gay and lesbian employees simply by adding sexual orientation to their non-discrimination policies and perhaps supporting formation of an in-house GLBT affinity group may be surprised to learn that addressing the needs of the transgender employee is typically not so straightforward. For such employers, the HRC Foundation provides several policy recommendations, such as incorporating education about transgender issues into diversity training programs, establishing written guidelines for supporting those in transition, and extending wellness-related benefits to transgender employees. (HRC Foundation has made available online the transgender workplace transition guidelines for oil and gas company Chevron Corporation and accounting firm Ernst & Young LLP (E&Y), which are referenced below.) It is in the implementation of such policy changes that many employers feel challenged.

Restroom and Locker Room Considerations

On a practical level, one of the most important issues that companies with transgender employees in transition face is those employees' access to restroom facilities. While the availability of a unisex, single-occupancy restroom is seen by the transgender community as the optimal solution to the situation, it may not be practical for a company to retrofit a single-occupancy restroom into its existing workplace. Consequently, Human Resources may be asked to implement a policy specifying which gender restroom a transgender employee should use. In doing so, it must determine at what point the company should consider an employee in transition to have assumed his or her reassigned gender: once the employee begins to assume the role, once the employee files a legal name change, or only once the employee has fully transitioned. Chevron has taken the position that a transgender employee should use the restroom of his or her birth-assigned gender until transition is complete. In contrast, E&Y considers the inflection point to be when the employee begins to assume the role of his or her reassigned gender in everyday life. This issue of an employer restroom policy has even led to litigation initiated by a transgender employee. In Goins v. West Group, a male-to-female transgender person sued her employer for discrimination because the company denied her access to the women's restroom. The Supreme Court of Minnesota held that the employer designation of employee restroom use based on biological gender did not violate the state's anti-discrimination laws. 635 N.W.2d 717 (Minn. 2001). In Minnesota, at least, an employer has discretion in setting its restroom policy.

Instituting a policy like E&Y's, however, may lead to considerable unease among non-transgender employees. In 2002, a female teacher in Minnesota sued her school district and principal, alleging that they had discriminated against her on the basis of her sex and religion by allowing a transgender coworker to use the women's faculty restroom. Cruzan v. Special Sch. Dist. #1 , 294 F.3d 981 (8th Cir. 2002). Although the Eighth Circuit Court of Appeals affirmed the lower court's dismissal of the claim, this case highlights the discomfort that some employees may feel about any such restroom policy. The same concern for privacy at the heart of the restroom issue similarly (or perhaps to an even greater extent) applies with respect to workplace changing rooms and locker rooms. In Opilla v. Parker, a female employee in New Jersey filed a suit alleging sexual harassment and a hostile work environment against her employer Lucent Technologies (among others) because an on-premises health center provided by Lucent (but operated by a separate corporate entity) allowed a transgender colleague to use the women's locker room. The state appellate court affirmed the lower court's dismissal of the plaintiff's claims, finding that the isolated incident had not created a hostile work environment. 2006 WL 2787047 (N.J. Super. Ct. App. Div. Sept. 29, 2006). The lesson to take away from these cases is that employers must be sensitive to, and plan for, potential confusion and unease in the workplace that may result from implementing special policies intended to support transgender employees. Educating all employees about the rationale for those policies, such as by widely disseminating workplace transition guidelines and providing support groups and counseling for employees to discuss their discomfort, may help to alleviate some problems.

Equal Wellness Benefits

The availability of relevant medical care, such as hormone therapy, mental health counseling, and surgical procedures related to sex reassignment, is another pressing concern for most transgender people. Yet, even companies that seek to extend equal benefits coverage to their transgender employees can be constrained by external factors, such as the explicit exclusions that most private medical insurance providers have instituted for procedures related to transitioning. Likewise, short-term disability for those recovering from sex reassignment surgery may not be available to employees in transition if the benefit provider has a blanket policy of classifying such surgery as elective or cosmetic, regardless of whether the surgery has been indicated by a physician as a medical necessity. Although some insurers provide the option for employers to include coverage for gender identity-related treatments in their insurance plans, others offer no such flexibility, leaving employers under those plans with their hands tied. Thus, unless their employers change benefit providers, comprehensive medical benefits for most transgender employees may be hard to come by, even with non-discrimination policies and workplace transition guidelines in place.

Conclusion

The issue of including gender identity in non-discrimination policies is expected to continue to develop, as legal protections increase and transgender employees feel more comfortable being open about their status in the workplace. Nevertheless, including gender identity as a protected category in their non-discrimination policies, while an appropriate and positive step, should not be viewed by employers as the end goal. The true challenges lie in the establishment of an inclusive environment for transgender employees to enjoy equal opportunities pursuant to those policies. External constraints beyond the commitment of the employer and other employees may continue to limit the ability of even the most progressive companies to offer transgender employees access to and benefits on par with those of non-transgender colleagues. Most employers have work to do to adjust their policies and workplace environment to support transitioning employees, and in an increasing number of jurisdictions, employers that fail to do so may find themselves in violation of the law.

John D. Shyer, a member of this newsletter's Board of Editors, is a labor and employment law partner in the New York office of Latham & Watkins LLP. Toshi Kameoka is an associate in the firm's San Francisco office.