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In Groundbreaking Decision, 7th Circuit Court of Appeals Finds Title VII Prohibits Sexual Orientation Discrimination

Labor & Employment Alert Otto W. Immel, Lindsey W. Davis, Michael Aldana

The Decision

On April 4, 2017, the Seventh Circuit Court of Appeals became the first court of appeals to conclude that Title VII prohibits employment discrimination on the basis of sexual orientation. Specifically, the full Seventh Circuit held that Plaintiff Kimberly Hively could proceed on her claim that Ivy Tech Community College of Indiana failed to hire her for multiple full-time teaching positions and terminated her part-time contract because she is homosexual. Hively v. Ivy Tech Comty. Coll. Of Ind., No. 15-1720, 2017 BL 110393 (7th Cir. Apr. 4, 2017).

Title VII states that it is unlawful for any employer to fail to hire, discharge, or otherwise discriminate against an individual because of the individual’s race, color, religion, sex, or national origin. The law does not expressly identify sexual orientation as a protected class, so how did the Seventh Circuit reach its conclusion that sexual orientation discrimination is, in fact, prohibited? 

Relying on a string of Supreme Court decisions, including Price Waterhouse v. Hopkins, 490 U.S. 228 (1998) (holding that the practice of gender stereotyping falls within Title VII’s prohibition against sex discrimination), the Seventh Circuit concluded that discrimination on the basis of sexual orientation is a form of sex discrimination. The majority reasoned that, “a policy that discriminates on the basis of sexual orientation…is based on assumptions about the proper behavior of someone of a given sex.” Thus, the court concluded: “Hively’s claim is no different from the claims brought by women who were rejected for jobs in traditionally male workplaces, such as fire departments, construction, and policing. The employers in those cases were policing the boundaries of what jobs or behaviors they found acceptable for a woman.” 

The Immediate Impact

Employers located within the Seventh Circuit—those in Indiana, Illinois, and Wisconsin—are now bound by the Hively decision that Title VII prohibits employment discrimination based on sexual orientation. The impact of the decision will likely be felt most in Indiana, where unlike Illinois and Wisconsin, there is not a state statute in place prohibiting employment discrimination because of sexual orientation.

But the decision is important for Illinois and Wisconsin employers as well. Unlike its state law equivalents, Title VII allows successful plaintiffs to recover punitive and compensatory damages. As a result, Illinois and Wisconsin employees may now be more motivated to pursue their claims under federal, as opposed to state law. 
 

What’s Next

The dissent lamented the Hively decision as one which “works a profound transformation of Title VII by any measure.”  While the decision binds only employers located within the Seventh Circuit, its impact will surely be felt far beyond the circuit’s geographic bounds. 

Not only will plaintiffs throughout the nation rely on the decision to support any contention that they suffered unlawful adverse employment actions because of their sexual orientation, but it also creates a circuit split which will likely result in Supreme Court intervention in the foreseeable future. While the defendant Ivy Tech has signaled that it does not intend to request Supreme Court review, there are two other cases pending in the Second and Eleventh Circuits that may soon give the Supreme Court the opportunity to weigh in. Although less likely, Congress could also interject to further define the parameters of Title VII. 

In the meantime, employers should continue to train their managers, supervisors, and human resources representatives regarding the prohibited bases for employment decisions (a list which, in the Seventh Circuit, now definitively includes sexual orientation). For more information regarding the Hively v. Ivy Tech decision or workplace anti-discrimination policies and practices, please contact Lindsey Davis at (414) 277-3073/[email protected], Michael Aldana at (414) 277-5151/[email protected], Otto Immel at (239) 659-5041/[email protected], or your Quarles & Brady attorney.