Transgender Supreme Court Bias Case Settles for $250,000

Author: David B. Weisenfeld, XpertHR Legal Editor

December 7, 2020

Firing an employee merely for being transgender not only violates Title VII of the Civil Rights Act - it also can prove quite costly for employers, as a new settlement shows.

The Michigan funeral home that lost a landmark Supreme Court case in June involving a transgender former director has agreed to pay $250,000 to settle the dispute.

Aimee Stephens lost her job as a funeral home director after revealing her intention to have sex-reassignment surgery. She had told her boss that she would return from an upcoming vacation as Aimee Stephens and dress in appropriate business attire. The funeral home owner told Stephens, "This is not going to work out." He offered a severance package, but she rejected it and filed suit.

Harris Funeral Homes v. EEOC is one of three consolidated cases the Supreme Court heard involving claims of LGBTQ discrimination. Stephens died just weeks before the Court issued its 6-3 ruling in her favor. The other two cases involved gay men who claimed their employers fired them shortly after learning of their sexual orientation.

The settlement requires the employer to pay $130,000 in back pay and compensatory damages to Stephens' estate, as well as $120,000 in attorney fees. The company also agreed to pay damages to 17 female employees to settle a separate discrimination claim that it provided suits to male employees while women had to buy their own clothing for work.

"An individual's homosexuality or transgender status is not relevant to employment decisions," said Justice Neil Gorsuch in writing the Supreme Court's opinion.

In a statement following the settlement, EEOC trial attorney Dale Price said, "The law is now clear that discrimination against an employee because of his or her transgender status is sex discrimination."