gender discrimination

The Impact of the Third Gender for Employers in Germany

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Germany’s Federal Constitutional Court (Bundesverfassungsgericht, BVerfG) has ruled that there must be the option of registering a gender that is neither male nor female on birth certificates. The introduction of a third gender will raise questions for employers too, in particular with regard to gender discrimination.

The Ruling

In late 2017, the BVerfG held that the constitutional rights of individuals who cannot be permanently categorized as belonging to either the male or the female gender are being violated if the law on civil status requires them to register their gender while not allowing any entry other than a positive gender definition as either male or female.

The case was brought by a registered female whose chromosome testing revealed that they were neither of female or male sex. The plaintiff had brought the action after several lower courts had ruled against a bid to introduce the gender options “inter” or “diverse” in the birth register.

In Germany it has been possible since 2013 to leave the gender box blank on the birth certificate or refer to the option “not stated” for people born with characteristics of both males and females. However, the court held that referring those affected to these options does not suffice and is unconstitutional.

According to the grounds, the German constitution protects the sexual identity of a person given that this is at the core of an individual’s personal identity and social perception. This protection also covers the positive description of one’s gender.

Now, the German legislature has until December 31, 2018, to implement new regulations in line with the BVerfG’s guidelines. The category could be called “inter” or “diverse.” Once the law is passed, Germany would become the first European country to offer intersex people the option of identifying as a designation other than male or female.

Some countries, including Australia and New Zealand, do recognize intersex as an option on official documents. In 2015, a law introduced in New York resulted in more than 700 people changing their birth certificates to “intersex.” In 2017, California became the second U.S. state to allow for such change.

Until the new law has passed, according to the court, courts and state authorities should no longer compel intersex people to choose between identifying as male or female. It is highly likely that a third gender will be introduced by such law. In employment law, too, this raises new questions, particularly in relation to discrimination on grounds of gender.

Gender-Neutral Job Advertisements

Discrimination on the grounds of gender must be prevented in accordance with the German General Act on Equal Treatment (Allgemeines Gleichbehandlungsgesetz, AGG). If employers disregard this rule, they face strict liability damages claims and compensation claims on the part of an affected employee. Also, the intangible damage suffered in the form of damage to a company’s reputation in case of gender discrimination is not to be underestimated, especially given the new power of social media where everyone is in the position to cause a PR crisis (aka shitstorm) for a company by just one tweet or post.

Employers must, in particular, design job advertisements in a gender-neutral manner. Since the ruling of the BVerfG, it must be assumed that the term “gender” no longer solely refers to men and women but includes individuals who do not belong to either the male or the female gender.

If one interprets section 1 AGG against the background of the recent ruling, the prohibition of gender discrimination will now no longer only apply to men and women but also to individuals who do not belong to either the male or the female gender. Consequently, there is a strong argument in favor of no longer addressing job advertisements only to women or men but also to a third gender in order to comply with the principle of gender neutrality as newly established by the BVerfG.

What Does the Ruling Mean in Practice?

Employers are well advised to review their current practice regarding job advertisements now and, in any event, no later than when the new law enters into force, presumably on January 1, 2019. The adjustment of job advertisements is also advisable in view of the reversal of the burden of proof under the AGG. If a job advertisement is placed without reference to the third gender, this will likely constitute a fact that gives rise to the presumption that this gender has been discriminated against. As a result, in the event of a dispute, the employer would have to rebut this presumption.

Gender-neutral broader language and job descriptions continue to be safe in view of a possible discrimination on the basis of gender. There is a strong tendency amongst legal advisors, however, to expressly make reference to the third gender in job advertisements. Employers should make it clear in their job advertisements that they are open to all kinds of people, regardless of their gender, and that they welcome their applications.

In this context, if no neutral job title can be found, it may be appropriate to include designations in brackets. The previous addition “(m/f)” does not take account of the third gender and therefore will likely give rise to a presumption of discrimination on the grounds of gender. The mere notice that “m/f” is deemed to include all individuals will likely not suffice to avoid any sanctions under anti-discrimination law. Based on the term “inter/diverse” suggested by the BVerfG, the designation in brackets should be extended to read “(m/f/d),” “(m/f/i)” or “(m/f/x)”.

Action to Take for Employers

Regardless of the need for action which has now clearly arisen on the part of the legislature, employers should pay closer intention to potential gender discrimination and look into the practical consequences of the ruling. Regardless of the decision, employers should create a work environment that is free from discrimination by also taking into account different gender identities.

As the law in this area continues to develop, here are some tips for employers looking to be proactive and minimize risk:

  • If you have not already, consider rewriting non-discrimination and anti-harassment policies to include gender identity and train employees on it.
  • Re-examining gender-based dress codes is a good idea.
  • Employees should have access to restrooms consistent with their gender identity: If possible, add a gender-neutral option or a single-occupant restroom.
  • Keep tabs on case law and legislation so you are prepared.

Fool’s Gold: Second Circuit Vacates Order Affirming Arbitrator’s Certification of Class of Jewelry Store Workers Including Absent Class Members

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On July 24, 2017, the Second Circuit Court of Appeals rejected a federal district court’s approval for a class of roughly 69,000 women claiming that Sterling Jewelers, Inc. (“Sterling”) discriminated against them based on sex. The decision overturned a district court ruling that affirmed an arbitrator’s decision to let the women proceed to trial as a class in an arbitration.

Plaintiffs initially filed a class action lawsuit in March 2008, alleging that Sterling’s practices and policies led to women being deliberately passed over for promotions and paid them less than their male cohorts. The case was sent to arbitration several months later under Sterling’s arbitration clause.

In 2009, an arbitrator ruled that Sterling’s dispute resolution program did not specifically bar class actions and allowed claimants to seek class status. From there, the case took a number of twists and turns, which we reported on more fully at the time here.

In June 2013, the employees moved for class certification. In February 2015, the arbitrator ruled that that the employees could proceed as a class in the arbitration.  In November 2015, the district court affirmed the arbitrator’s decision concluding that the arbitrator did not exceed her authority by certifying a class that included absent class members i.e., employees other than the named plaintiffs and those who have opted into the class.  Sterling appealed. READ MORE →

No Similarly Situated Employees, No Claim: Vanderbilt Prevails on Summary Judgment in Professor’s Sex Discrimination Lawsuit

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Last week the Sixth Circuit upheld a grant of summary judgment in the employer’s favor on a former employee’s sex discrimination claim, finding plaintiff failed to meet her burden to establish a prima facie case of discrimination.

The Case

Dr. Jean Simpson was a professor at Vanderbilt University School of Medicine. While teaching at the University, Dr. Simpson started her own private consulting practice doing breast-pathology.  Upon learning of Dr. Simpson’s consulting practice, the University instructed her the external employment violated the Conflict of Interest Policy, the Vanderbilt Medical Group (“VMG”) By-Laws and the VMG Participation Agreement and asked her to cease the consulting work.  She refused.  The University later terminated Dr. Simpson because of these violations. READ MORE →

California Legislators Aim to Make Prior Salaries a Thing of the Past

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A few months ago, the California State Assembly introduced AB 1676, a bill that not only would have prohibited employers from asking job applicants about their compensation history, but also would have required employers to provide pay scale information upon reasonable request. A nearly identical bill passed through the Assembly and Senate before it was vetoed by the Governor toward the end of last year. In his veto statement, the Governor expressed concern that such a measure “broadly prohibits employers from obtaining relevant information with little evidence that [it] would assure more equitable wages.”

As we previously reported, the Fair Pay Act (the “FPA,” Labor Code § 1197.5) requires “equal pay for substantially similar work” based on the employee’s skill, effort and responsibility, and similar working conditions. To the extent a disparity exists between employees of the opposite sex, it must be reasonably based on one or more the factors enumerated within the statute.

Perhaps hoping to avoid repeating history, proponents of AB 1676 have taken a new approach. In place of the provision prohibiting inquiries about prior salary history is new language that amends the FPA to state that “[p]rior salary shall not, by itself, justify any disparity in compensation.”

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Employers Left Hanging Again:  Coates v. Farmers Reaches Settlement & Still No Answers on Interpreting California’s Fair Pay Act

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Plaintiff Lynne Coates filed a class action lawsuit against Farmers on April 29, 2015 alleging gender discrimination claims under Title VII and California’s Fair Employment and Housing Act, including violations of the federal and California equal pay acts and California’s Private Attorneys General Act. In this post on Orrick’s Equal Pay Pulse blog, Orrick attorneys Erin Connell, Allison Riechert Giese and Megan Lawson examine Coates v. Farmers and what it means for employers as well as future equal pay claims in California.

Proposed German Equal Pay Act May Complicate Remuneration Issues

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Statistics reveal a difference of 7 percent between the remuneration paid to men and that paid to women with the same qualifications in Germany. The average hourly wage even shows a difference of 22 percent, making pay discrepancy in Germany one of the highest in the EU. In order to adjust these wage injustices, the German Federal Ministry for Family Affairs, Senior Citizens, Women and Youth submitted a first preliminary ministerial draft of the German Equal Pay Act (Entgeltgleichheitsgesetz) on December 9, 2015. The act is expected to be adopted in 2016.

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Protection for LGBT Workers on the Rise: EEOC Files First Title VII Lawsuits Alleging Sexual Orientation Discrimination

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Earlier this month, the EEOC filed its first lawsuits against employers alleging sexual orientation discrimination under Title VII, arguing that Title VII’s protections extend to sexual orientation as a form of gender bias. In the lawsuit against Scott Medical Health Center filed in the U.S. District Court for the Western District of Pennsylvania, the EEOC alleges that a gay male employee was subjected to harassment, including anti-gay epithets, because of his sexual orientation. In the suit against Pallet Companies d/b/a/ IFCO Systems filed in the U.S. District Court for the District of Maryland, the EEOC alleges that a supervisor harassed a lesbian employee because of her sexual orientation, including making numerous comments about her sexual orientation and appearance. The EEOC alleges that the employers violated Title VII, which extends protection to workers who are discriminated against on the basis of their sexual orientation. In both cases, the EEOC takes the position that sexual orientation discrimination necessarily entails treating employees less favorably because of their sex, thus triggering Title VII’s protections.

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Ninth Circuit Holds Statistical Evidence May Establish Prima Facie Claim of Disparate Treatment Without Accounting for Defendant’s Legitimate, Non-Discriminatory Reasons for Adverse Action

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In Schechner v. KPIX-TV, No. 11–15294, 2012 WL 1922088 (9th Cir. May 29, 2012), the Ninth Circuit Court of Appeals held that a plaintiff may establish a prima facie case of disparate treatment age discrimination using statistical evidence, even where that evidence does not account for a defendant’s legitimate non-discriminatory reasons for the adverse employment action.  However, the court found the plaintiffs’ statistical evidence insufficient to demonstrate that the defendant’s proffered reasons for the adverse employment action were pretextual. READ MORE →