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Supreme Court LGBTQ Ruling Pushes Workplace Dynamic Already in Motion

When a Walmart associate named Jacqueline Cote filed a charge with the Equal Employment Opportunity Commission in 2014 contending that the company was discriminating against her by denying health insurance benefits to her same-sex spouse, it signaled the beginning of a drawn-out legal battle.

It was not until December 2016 that the company announced that it had agreed to a settlement retroactively compensating Ms. Cote and other employees affected by the denial of spousal benefits.

If, by contrast, Ms. Cote had brought her case after the Supreme Court ruling on Monday holding that lesbian, gay and transgender employees are covered by the civil rights law that protects workers from discrimination on the basis of race, religion and sex, said one of her lawyers, Janson Wu, executive director of LGBTQ Legal Advocates & Defenders, the case would probably have been resolved much more quickly.

“At the time we litigated that case employers could argue that an employee didn’t have a legal claim to bring,” he said. “With this decision, it should be clear that employees shouldn’t even have to bring a lawsuit to enforce their rights.”

Even before the ruling on Monday, employers were moving toward nondiscrimination on the basis of sexual orientation and gender identity, prompted by state laws, significant E.E.O.C. rulings in 2012 and 2015, and federal appellate decisions since then.

Many companies adopted rules stating that sexual orientation and gender identity did not affect their hiring, firing or promotion decisions, and providing same-sex spousal benefits. According the Society for Human Resource Management, 82 percent of employers offering insurance extended health benefits to same-sex spouses last year, up from 46 percent in 2014. (Walmart made health benefits available to same-sex spouses in 2014 but, until the 2016 settlement, maintained that it was not obligated to do so.)

Because there was no nationwide policy, however, the changes were largely ad hoc and conditional — dependent on corporate calculations about costs and benefits.

While the E.E.O.C. could authorize workers to bring lawsuits under Title VII of the Civil Rights Act of 1964, its determinations did not bind a judge, and the outcome in many jurisdictions was far from clear even if plaintiffs proved discrimination based on sexual orientation or gender identity.

As a result, many employers decided that it was worth aggressively litigating an area in which their responsibilities were ill defined, or trying to settle on favorable terms.

In a 2014 lawsuit by a Texas-based employee of Saks Fifth Avenue contending that she had been harassed and later fired because she was transgender, the company sought a dismissal by arguing that federal law did not ban discrimination based on gender identity, only to reverse course under pressure from civil rights groups and the Justice Department.

The pressure appeared to work, but it raised questions about what would happen at companies less susceptible to public pressure.

“The arguments raised by Saks in that case, that transgender employees are not protected, it caused a firestorm for them because of the fact that they are a retailer that has a lot of policies favoring L.G.B.T.Q. people,” said Jillian Weiss, a prominent employment discrimination lawyer who brought the case. “They backed off that position. But now nobody is going to be able to take that position.”

Ms. Weiss said she expected the decision on Monday to change her bargaining position in settlement talks with defendants who had said, “We’re not going to give you more because once the Supreme Court rules, then we’d have to give you zero.”

Ahead of the Supreme Court ruling, some 200 companies, including Google, Facebook, Hilton, Nike and the Walt Disney Company, signed a brief in support of the plaintiffs — making it one of the largest instances of employer support for employee plaintiffs in Supreme Court litigation, according to Tico Almeida, now at the law firm WilmerHale, who helped to write the brief.

Mr. Almeida said support for the brief was often propelled by advocacy by companies’ gay employees.

But while the cases in the Monday ruling involved relatively small employers — a skydiving company, a mortuary, a county government — many gay-rights proponents predicted that large employers could wind up as defendants in other cases.

Even though such companies are more likely to have inclusive human resources policies, adoption can vary significantly.

“We see big employers who often have managers in certain locations that have really offensive discriminatory actions,” said Sally Abrahamson, an employment lawyer at the firm Outten & Golden.

After the Supreme Court’s 2015 decision that same-sex couples had a constitutional right to marry, some lamented that workers could be married on a Sunday and fired on a Monday — only because they had acknowledged being gay.

Ms. Abrahamson said that such practices were often as prevalent at large employers as at smaller ones, and that her firm had heard from workers in recent years who had been fired from chains in states like Indiana and Georgia after marrying a same-sex partner.

“There are so many terminations in states that have no protections,” she said, adding that she expected a significant uptick in litigation. More than half of states lack strong civil rights protections for gay and transgender residents, according to the Movement Advancement Project, a think tank focused on equal rights for gay, lesbian, bisexual and transgender people.

Mr. Wu, the lawyer in the Walmart case, said the decision would affect not simply one-off workplace developments like hiring and firing, but the daily quality of life many employees experience. “Employment discrimination doesn’t just include being fired,” he said. “It includes being treated differently, workplace harassment, which transgender employees suffer at higher rates.”

He said he believed that the decision would also require employer health care plans to cover surgery and other medical costs related to a gender transition.

Other experts cautioned that even having legal protection nationwide does not mean that gay and transgender workers are likely to prevail. Over all, plaintiffs still lose most discrimination cases in federal court, though many strong cases settle before trial.

“It’s a guarantee that if a person ends up going to court, their ability to bring a claim is not in doubt,” said Chai Feldblum, a Democratic E.E.O.C. commissioner from 2010 to 2019. “Whether that claim succeeds is no different than in any other case.”

But now, she added, “there’s no longer a barrier in front of the courtroom door.”