The U.S. District Court for the Northern District of Texas recently issued a ruling vacating the “gender-identity related portions” of the Equal Employment Opportunity Commission’s (EEOC’s) 2024 Guidance interpreting Title VII of the Civil Rights Act of 1964’s scope and coverage as it relates to the LGBTQ+ community. The opinion, rendered by Judge Matthew J. Kacsmaryk, addresses the scope of the EEOC’s authority to interpret and apply Title VII and reflects the ongoing debate over the meaning of “sex” under federal antidiscrimination law.
Background
In 2024, following notice and comment, the EEOC issued updated guidance on Title VII, interpreting “sex” to include “pregnancy, childbirth, and related medical conditions” and “sexual orientation and gender identity.” The 2024 Guidance also stated that “sex-based harassment includes harassment based on sexual orientation or gender identity, including how that identity is expressed,” “repeated and intentional use of a name or pronoun inconsistent with the individual's known gender identity (misgendering)” and “denial of access to a bathroom or other sex-segregated facility consistent with the individual's gender identity”.
The State of Texas and the Heritage Foundation filed suit, arguing the EEOC overstepped its statutory authority and that the guidance conflicted with the text and judicial interpretation of Title VII. While the litigation was pending, President Trump signed an Executive Order titled “Defending Women From Gender Ideology Extremism and Restoring Biological Truth to the Federal Government” (which we covered here), which defined sex in binary terms as “an individual’s immutable biological classification as either male or female” and that “‘[s]ex’ is not a synonym for and does not include the concept of ‘gender identity’.” It further directed all federal agencies, including the EEOC, to revoke any interpretation inconsistent with the Executive Order’s definition of “sex.” Shortly thereafter, President Trump removed two EEOC members leaving the agency without a quorum to carry out rule making functions, as would be required to revoke the 2024 Guidance.
The Court’s Decision
Judge Kacsmaryk first rejected the argument that President Trump’s Executive Order eliminated or modified the EEOC’s 2024 Guidance outright, and addressed the merits of the EEOC’s guidance directly. In doing so, Judge Kacsmaryk held that the EEOC exceeded its authority by expanding the definition of “sex” under Title VII. The court rejected the EEOC’s reliance on Bostock v. Clayton County (covered here), which held that terminating an employee for being gay or transgender is a form of sex discrimination under Title VII. Judge Kacsmaryk explained that Bostock did not re-define “sex” or address issues such as restrooms, pronouns, or dress codes. Judge Kacsmaryk noted that Bostock expressly refused to provide a definition of “sex” and that “the [Supreme Court] majority affirmed a bedrock principle of Title VII: ‘Sex’ refers ‘only to biological distinctions between male and female’ and ‘homosexuality and transgender status are distinct concepts from sex.’”
According to the court, the EEOC’s 2024 Guidance introduced substantive policy changes, rather than interpretive rules, which exceeded the agency’s delegated authority. Judge Kacsmaryk noted that while a “federal agency is obligated to follow circuit precedent in cases originating within that circuit, an agency such as EEOC—which is only authorized to issue procedural rules implementing Title VII—cannot issue new substantive rules and definitions derived from non-binding circuit case law.” Ultimately, Judge Kacsmaryk concluded that Title VII, as written, prohibits discrimination on the basis of “biological sex” and does not extend to gender identity or sexual orientation unless Congress amends the statute to say otherwise. Specifically, the court held:
By its plain text, Title VII prohibits sex discrimination. And it prohibits pervasive sexual harassment constituting sex discrimination. But Title VII remains rooted in a biological understanding of sex. And Title VII does not require employers or courts to blind themselves to the biological differences between men and women. Nor does it mandate that employers obliterate neutral employment policies rooted in this recognition. Thus, the Enforcement Guidance contravenes Title VII by expanding the definition of “sex” beyond the biological binary and requiring employers to accommodate an employee's dress, bathroom, or pronoun requests.
The court also rejected the EEOC’s interpretation of sex-based “harassment,” finding that the guidance impermissibly classified conduct related to gender identity (i.e., bathroom access, pronoun, and dress preferences) as unlawful harassment. Judge Kacsmaryk concluded that such interpretations go beyond what Title VII requires, which he viewed as limited to protecting against discrimination based on “biological sex.” Judge Kacsmaryk clarified that “the Supreme Court expressly refused to extend its reasoning in Bostock to the scenarios and hypothetical contemplated in the Enforcement Guidance. And the EEOC cannot ‘fill in the blanks’ for the Supreme Court.”
Ultimately, Judge Kacsmaryk held that if Congress wanted to expand the definition of “sex” under Title VII it is free to do so and knows how to amend a law. Absent Congressional action, the court held, the definition of “sex” in Title VII does not include “gender identity” or “sexual orientation,” and the EEOC’s 2024 Guidance “contravenes Title VII's plain text.” Accordingly, the court vacated the “gender-identity related portions” of the EEOC’s 2024 Guidance.
What Employers Need to Know
This ruling only vacates the “gender identity-related” portions of the EEOC’s 2024 Guidance. While the decision may impact federal enforcement of Title VII in some jurisdictions, it does not affect state or local laws that explicitly include sexual orientation and gender identity as protected characteristics. Furthermore, while Judge Kacsmaryk vacated portions of the 2024 Guidance, and it is unlikely that the EEOC will appeal given the current administration’s directives on enforcement and policy, Bostock is still binding law. Despite the district court’s holdings regarding the definition of sex, the Supreme Court in Bostock stated, “[f]or an employer to discriminate against employees for being homosexual or transgender, the employer must intentionally discriminate against individual men and women in part because of sex. That has always been prohibited by Title VII's plain terms—and that should be the end of the analysis.” Bostock, 590 U.S. at 662 (internal quotations omitted). Therefore, employers should still be mindful of the Bostock opinion.
Importantly, Bostock only addressed the question of termination. Bostock specifically stated that “other policies and practices might or might not qualify as unlawful discrimination or find justifications under other provisions of Title VII are questions for future cases, not these.” Bostock, 590. U.S. at 681. It is these “other policies and practices” that the 2024 Guidance attempted to address, and which have now been vacated. These types of “policies and practices” prohibited by the now-vacated portion of the 2024 Guidance could still, nevertheless, result in lengthy litigation for employers, which ultimately will have to end at the Supreme Court for a final determination. Employers should continue to monitor their obligations under Title VII as well as their obligations under all applicable state and local laws that provide protections greater than Title VII.