Title VII Gender Identity Claim Goes Forward

Texas federal judge dismissed claims alleging gender identity discrimination asserted under the Affordable Care Act (ACA) and the Employee Retirement Income Security Act (ERISA) against an insurer and employer because there is no precedent that either act recognizes any such claim. But the employee's claim under Title VII of the Civil Rights Act of 1964 was allowed to proceed.

Charlize Marie Baker was employed by L-3 Communications Integrated Systems LP and insured under its health plan and short-term disability plan, administered by Aetna Life Insurance Co. In 2011, Baker began transitioning from male to female. She legally changed her name and changed her gender designation from male to female on all government-issued documents.

In 2015, a health care professional deemed it medically necessary that Baker undergo breast implant surgery in order to treat her gender dysphoria. Baker scheduled surgery and sought benefits from Aetna under the health plan to cover her post-surgery recovery. Aetna denied her claim, precipitating Baker filing a lawsuit in a Texas federal court alleging that Aetna and L-3 discriminated against her based on her gender identity in violation of the ACA, that Aetna denied her benefits under the short-term disability plan in violation of ERISA, and that Aetna and L-3 violated Title VII by discriminating against her based on her sex. Aetna and L-3 asked the court to dismiss Baker's discrimination claims.

The court determined that the claim under the ACA must be dismissed because Baker failed to cite any authority that recognizes a cause of action under the ACA for discrimination based on gender identity. For the same reason, the court dismissed Baker's ERISA claim. Finally, regarding Baker's Title VII claim, the court dismissed the claim against Aetna because it was not Baker's employer but held that the claim, as it pertains to L-3, could move forward because she had sufficiently alleged in her complaint that she was denied employee benefits from L-3 due to her sex.

Baker v. Aetna Life Ins. Co., N.D. Texas, No. 3:15-cv-3679-D (Jan. 13, 2017).

Professional Pointer: This case is a vivid reminder of how important it is for employers to remain cognizant of the societal evolution of transgender rights and how it may impact their workforce. A prudent employer should carefully evaluate any and all claims brought by employees who are transgender to ensure that any action taken in connection therewith is gender-neutral.

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