United States: Texas Pending LGBT-Related Legislation: What It Means For Employers

Executive Summary: Issues pertaining to LGBT rights have been a focal point of public debate and discourse for several years, but since the U.S. Supreme Court's decision in Obergefell v. Hodges, these issues increasingly have also been the focus of legislative action. While many states have implemented additional protections for LGBT people, the Texas legislature has gone in the opposite direction, introducing a "bathroom bill" aimed at transgender people, as well as numerous other "religious freedom" bills that some view as potentially permitting discrimination against those who are LGBT. Below is an overview of the state of LGBT rights and legislation in Texas.

Background: In 2015, the U.S. Supreme Court held that marriage is a fundamental right, and that states must perform and recognize same-sex marriage. Obergefell v. Hodges, 135 S. Ct. 2584 (2015). That same year, seemingly in anticipation of a ruling on same-sex marriage, the Texas legislature introduced 23 anti-LGBT bills. None were enacted. This year, in furtherance of the agenda set forth by Governor Greg Abbott and Lieutenant Governor Dan Patrick, Texas lawmakers have introduced 24 LGBT related bills. Although these bills are not set forth as "anti-LGBT," LGBT advocates contend otherwise.

To date, the most hotly debated of the proposals is "SB 6," commonly known as the "bathroom bill," which would restrict access to restrooms and other changing facilities based on "biological sex ... stated on a person's birth certificate." After hearing 21 hours of contentious testimony by Texas citizens, the Senate approved the bill. The House must next consider the bill, and it is far less certain that it will pass there. Republican Speaker Joe Strauss has publicly voiced his opposition to the bill because of feedback he has received from "hundreds and thousands of job-creating businesses" advising that passage of the bill would hurt Texas' economy. A study released in late 2016 by the Texas Association of Business estimated that Texas would risk losing 185,000 jobs and up to $8.5 billion if anti-LGBT legislation is enacted.

A practical issue with SB 6 is the fact that Texas has no statutory or regulatory mechanism for changing a person's sex on his or her birth certificate. In the past, some state court judges have been willing to order such a change upon petition. This requires the petitioner to submit fingerprints to the Department of Public Safety for a full criminal background check, as well as to present to the court evidence from a primary health care provider and a mental health care provider establishing that he or she has undergone sufficient physical and mental treatment. If granted, the court orders the Department of Public Safety and the Department of State and Health Services to issue a driver's license and replacement birth certificate, respectively, reflecting the corrected gender marker. But in conservative parts of the state, judges are more likely to deny these petitions, which prevents the transgender individual from having his or her birth certificate changed, regardless of what hormonal, surgical, or other treatment has already taken place. In October 2016, the Dallas Court of Appeals affirmed one such district court's refusal to change a gender marker, stating "[t]he legislature's decision not to establish a scheme for sex change orders comparable to Chapter 45 [regarding name change orders] suggests a lack of legislative intent to grant Texas courts the authority to make such orders." In re McReynolds, 502 S.W.3d 884, 888 (Tex. App. – Dallas 2016). Because Dallas district courts had been considered the most likely to grant petitions, the precedential effect of this ruling may prevent most residents from obtaining a sex change order. To date, the issue has not been appealed to the Texas Supreme Court. This month, identical bills were introduced by Democratic lawmakers in the Texas House and Senate which outline a process by which transgender people could apply directly to the state registrar for amended birth certificates. The bills include the same requirements that trial courts had required, but are unlikely to pass in the current political climate.

Beyond the pending "bathroom bill," other proposals would bar same-sex marriage, allow businesses to turn away customers because of "religiously held beliefs," allow adoption agencies to refuse to place children based on "religiously held beliefs," and require public school teachers to "out" students to their parents. But of greatest import to employers in Texas, one bill would bar cities and municipalities from enforcing local anti-discrimination laws. Passage of this law would negate the LGBT protections enacted by Austin, Dallas, Fort Worth, and Plano.

Bottom Line: SB 6 (the "bathroom bill") and most of the other 23 pieces of legislation that could negatively impact LGBT rights are not expected to pass both houses of the Texas Legislature. Regardless, Texas employers should be aware of and sensitive to the heightened anxiety that their Texan LGBT employees are likely feeling in the current political climate. Employers who have Texas employees in municipalities with nondiscrimination ordinances have hopefully revised their policies to include LGBT nondiscrimination. Even if legislation were passed to nullify those municipal laws, employers may wish to continue to adhere to the nondiscrimination policies for both legal and practical reasons. Legally, legislation nullifying municipal nondiscrimination laws might ultimately be overturned by a court or by subsequent legislation. Even if such legislation is not overturned, the nullification of municipal nondiscrimination laws would not require employers to change their nondiscrimination policies, and in fact federal guidance from the EEOC supports maintaining policies prohibiting discrimination on the basis of sexuality, gender identity, and gender expression. Practically, to remove the protection from LGBT employees may have adverse effect on the morale in the workforce. Additionally, for employers in multiple states or jurisdictions, which may provide for more encompassing protection for LGBT employees, the administration of broad nondiscrimination policies may be far easier than differing policies depending on the particular jurisdiction.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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