PayPal’s headquarters is located in San Jose. (Photo: Jeff Chiu/AP)

By Michael Walsh

By losing PayPal, North Carolina might have just suffered the most palpable financial consequence of having a law that many consider discriminatory against transgender people.

The California-based online payment company announced Tuesday that it is abandoning its plan to set up a new $3.6 million global operations center in Charlotte, N.C., which it said would have employed more than 400 people in skilled jobs.

Dan Schulman, president and CEO of PayPal, said House Bill 2 (HB2) invalidates protections of rights for LGBT citizens and denies them equal rights under the law.

“This decision reflects PayPal’s deepest values and our strong belief that every person has the right to be treated equally, and with dignity and respect,” Schulman wrote in a statement. “These principles of fairness, inclusion and equality are at the heart of everything we seek to achieve and stand for as a company. And they compel us to take action to oppose discrimination.”

He said PayPal regrets that it will not have the opportunity to become part of the Charlotte community and work with the region’s many talented people.

“While we will seek an alternative location for our operations center,” Schulman continued, “we remain committed to working with the LGBT community in North Carolina to overturn this discriminatory legislation, alongside all those who are committed to equality.”

LGBT activists march against House Bill 2 in Chapel Hill, N.C. (Photo: Whitney Keller/The Herald-Sun via AP)

Under HB2, people in North Carolina are only permitted to use public restrooms that correspond with their biological sex, defined as “the physical condition of being male or female, which is stated on a person’s birth certificate.” The bill also forbids local governments from passing local ordinances that would outlaw discrimination against particular groups of people.

Proponents of HB2 argue that it would stop violent men from sneaking into women’s restrooms to sexually assault them. Opponents of HB2 argue that this is a scare tactic to legalize discrimination.

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Many businesses have already spoken out against the bill. PayPal’s announcement comes just days after Lionsgate pulled the plug on filming a new Hulu show in Charlotte.

The Human Rights Campaign, which advocates for LGBT rights in the state, said PayPal is sending a loud and clear message to North Carolina Gov. Pat McCrory, who signed HB2 into law on March 23.

“With every passing day that HB2 remains on the books, Governor McCrory is inflicting damage on the state’s economy and reputation,” Griffin said in a news release. “The fact also remains that this destructive and appalling bill continues to put people across the state at risk of harm and discrimination. It is time for Governor McCrory to stop this senseless crusade against equality and repeal HB2 once and for all.”

The North Carolina Family Policy Council, a conservative nonprofit supporting HB2, argued that the Human Rights Campaign and other activist groups have manufactured this outrage on behalf of the “LGBT agenda.”

“Far from an ‘organic’ outrage by the business community, you have to hand it to the Human Rights Campaign for orchestrating a masterful PR and lobbying campaign against House Bill 2,” NCFPC president John Rustin wrote.

Lawmakers in North Carolina approved HB2 in March to counteract an ordinance passed by the Charlotte City Council that prohibited discrimination against LGBT people and affirmed the right of transgender people to use the restroom that aligns with their gender identity.

