Maryland’s Supreme Court Finds “Sex” Discrimination Protections Do Not Include Sexual Orientation (or Gender Identity)

By Fiona Ong - Shawe Rosental LLP

August 16, 2023

In an interesting, but ultimately unsurprising, analysis of Maryland’s anti-discrimination law, Maryland’s highest court has determined that the State’s prohibition against “sex” discrimination, including in the workplace, does not include sexual orientation (and by extension, gender identity). But employers should be aware that other protections for those personal characteristics exist under both state and federal law.

Background of the Case. In a 2020 landmark ruling, Bostock v. Clayton County, the U.S. Supreme Court held that Title VII’s prohibition against “sex” discrimination in employment encompasses sexual orientation and gender identity (as we discussed in a June 15, 2020 E-lert).

In Doe v. Catholic Relief Services, a case involving whether a religious organization must provide health benefits for a same-sex spouse, a Maryland federal court asked the Maryland Supreme Court for its opinion on whether the Maryland Fair Employment Practices Act (MFEPA) and the Maryland Equal Pay for Equal Work Act (MEPEWA) similarly and necessarily includes sexual orientation in the definition of “sex.” The Maryland Supreme Court was also asked whether an exemption to MFEPA that allows a religious entity to employ only those of a particular religion, sexual orientation or gender identity applies to all employees of the religious entity or only those performing religious activities.

The Maryland Supreme Court’s Ruling. The Maryland Supreme Court found that these questions involved issues of statutory interpretation. Certain principles of statutory construction apply to the Court’s analysis. In examining the actual language of the statutes in question, the Court must consider the statute in its entirety in order to give logical meaning to each of its parts. Where the language is ambiguous, the Court will look to legislative history or other relevant sources to determine the Maryland General Assembly’s intent. Furthermore, for remedial statutes, like the MFEPA and MEPEWA, the Court will read them liberally in favor of those seeking the laws’ protection.

Sex and Sexual Orientation Are Separate Categories Under the MFEPA. As to whether “sex” under the MFEPA includes “sexual orientation,” the Court noted that sexual orientation is a separate protected category under the law. Therefore, “the General Assembly did not understand and intend that the prohibition against sex discrimination would also prohibit sexual orientation discrimination.” The Court further observed that to read sex to include sexual orientation would make the specific sexual orientation (and we note, by extension, gender identity) exemption for religious organizations irrelevant, as a plaintiff could simply “plead around” the exemption by asserting sex discrimination.

The Court found additional support for its interpretation that sex does not include sexual orientation in the legislative history of the amendment that added sexual orientation as a separate protected category, as well as the concurrent amendment that added sexual orientation to the religious entity exemption. It was clear from this history that the legislators and the Maryland Commission on Civil Rights (the state agency that enforces the MFEPA) believed that sexual orientation was separate and distinct from sex.

The MEPEWA Does Not Prohibit Sexual Orientation Discrimination. Similarly, the Court found that the plain language of the MEPEWA specifically prohibits pay discrimination on the basis of sex and, as of 2016, gender identity, and that the exclusion of sexual orientation was “purposeful” since it was not added at that same time.

Moreover, given that both the MEPEWA and MFEPA concern the same subject matter, the Court further explained that it would interpret “sex” under both laws in the same way – to not include sexual orientation.

MFEPA’s Religious Entity Exemption Applies to Employees Who Perform Core Mission Duties. The employee argued that the MFEPA’s religious entity exemption should mimic the federal law’s “ministerial” exemption to apply only to those employees directly involved in the entity’s religious activities. On the other hand, the employer argued that all of its employees should be covered by the exemption. The Court took a middle road, holding that the exemption applies to “employees who perform duties that directly further the core mission (or missions) of the religious entity.”

The Court provided guidance on determining a religious entity’s core mission(s), noting that there may be additional factors that may be considered:

•  That it involves “a fact-intensive inquiry that requires consideration of the totality of the pertinent circumstances.”
•  Duties that directly further the core mission are “duties that are not one or more steps removed from taking the actions that effect the goals of the entity.” As examples, the Court compared a janitor (indirect) with an executive director (direct).
•  The entity’s size may be relevant – smaller organizations may have fewer employees whose work does not directly further its mission than larger organizations.
•  A religious entity may have both religious and secular core missions, and more than one of each.
•  In making the determination, a trial court may consider, among other things: the description of the entity’s mission(s); the services provided; the people the entity seeks to benefit; and how the entity’s funds are allocated.

What Now? Interestingly, the Court suggested that, in light of this case, the General Assembly might amend the MFEPA to “harmonize” it with Bostock’s interpretation of Title VII. We would certainly anticipate the General Assembly to take up that call in the next legislative session.

In the meantime, employers with Maryland employees must keep in mind that, while the MFEPA’s definition of sex may not include sexual orientation, the law also expressly prohibits discrimination on the basis of sexual orientation, as well as gender identity. In addition, employers with 15 or more employees are also covered by Title VII, which does include sexual orientation and gender identity in its protections against sex discrimination. As for the MEWEPA, it applies to sex and gender identity, but not sexual orientation; but again, federal law would (likely) define sex under the federal Equal Pay Act to include sexual orientation and gender identity. Thus, although the federal and state laws may be structured differently, in the end, the practical effect is the same – Maryland employees of employers covered by Title VII and Maryland law are protected from discrimination and pay disparities on the basis of sex, sexual orientation or gender identity.

The exemption from such protections for certain employees of religious entities may be broader under state law than federal law, but if the employer is covered by both laws, the difference is again without practical effect. Any savvy employee will assert claims under the law that provides the greatest protection, whether federal or state.

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