Following the 2012 Equal Employment Opportunity Commission decision of Macy v. Bureau of Alcohol, Tobacco, Firearms and Explosives and the United States Supreme Court Obergefell v. Hodges decision, the EEOC has issued a decision that Title VII covers claims of discrimination based on sexual orientation.

The Federal Aviation Administration ("FAA"), hired the Complainant as a temporary Front Line Manager ("FLM"). When he later sought, but was not selected for, a permanent position, the Complainant alleged that the FAA did not hire him for a permanent position because he is gay. As evidence of this alleged discrimination, the Complainant claimed that his supervisor, who was involved in the selection process, made several negative comments about his sexual orientation. The FAA issued a decision denying the complaint on the basis that sexual orientation is not a protected class.

On appeal, the EEOC held that for purposes of Title VII, the question of coverage of the sexual orientation claim turned on whether the FAA had "relied on sex-based considerations" or took "gender into account" when making the challenged decision.

Reviewing the facts of the case, the Commission determined that the FAA had indeed relied on sex-based considerations and took the complainant's sex into account in its employment decision. Thus, the Commission reasoned, the Complainant had stated a claim of Title VII sex discrimination. Not limiting its decision to just the facts of the case, the Commission further concluded that sexual orientation is inherently a "sex based consideration" and that an allegation of discrimination based on sexual orientation is "necessarily an allegation of sex discrimination under Title VII."

Historically, claims of sexual orientation discrimination have not had much success because Title VII does not expressly name "sexual orientation" as a protected class. This decision, however, stands as a game changer in two key respects. First, it recognizes that federal employees have a claim under Title VII for discrimination based upon their sexual orientation. More significantly, however, employees at private employers may also have a colorable argument for similar protection. Under the U.S. Supreme Court decision of Chevron U.S.A., Inc. v. Natural Resources Defense Council, Inc., courts are to give some deference to the Commission's interpretation of Title VII, although they are not requred to follow the Commision if they find the Commission acted contrary to the law. 467 U.S. 837 (1984).

It remains to be seen whether the courts, particularly those in Texas, will grant deference to the EEOC in this matter. As noted above, they are not absolutely requred to do so. Employers in Texas, however, can no longer assume that an employee cannot make a Title VII claim based on sexual orientation discrimination. In light of this decision and Macy, employers should expect to see that the Commission — nationally and certainly in Texas — will aggressively look for opportunities to pursue sexual orientation and gender identity discrimination claims.