WASHINGTON (Reuters) - The Supreme Court on Monday agreed to decide whether U.S. law banning workplace discrimination on the basis of sex protects gay and transgender workers, as the conservative-majority court waded into a fierce dispute involving a divisive social issue.

At issue in the high-profile legal fight is whether gay and transgender people are covered by Title VII of the Civil Rights Act of 1964, which bars employers from discriminating against employees on the basis of sex as well as race, color, national origin and religion. President Donald Trump’s administration has argued that Title VII does not cover sexual orientation or gender identity.

The court, whose 5-4 conservative majority includes two Trump appointees, will take up two cases concerning gay people who have said they were fired due to their sexual orientation, one involving a New York skydiving instructor named Donald Zarda and another involving a former county child welfare services coordinator from Georgia named Gerald Bostock.

The court also will hear a Detroit funeral home’s bid to reverse a ruling that it violated federal law by firing a transgender funeral director named Aimee Stephens after Stephens revealed plans to transition from male to female.

The justices will hear arguments and issue a ruling in their next term, which starts in October.

Trump’s administration reversed the approach taken under Democratic former President Barack Obama by the U.S. Equal Employment Opportunity Commission (EEOC), which enforces federal laws banning workplace discrimination.

“The American public would be shocked if the Supreme Court ruled that it’s perfectly legal to fire someone because she is transgender or lesbian. That doesn’t fit with American values of fair play and the idea that you should be judged on your work and not on who you are,” said James Esseks, a lawyer with the American Civil Liberties Union, which represents two of the employees.

The Title VII fight marks the court’s first major test on a contentious social issue since Trump’s appointee Brett Kavanaugh joined it in October after a difficult Senate confirmation process.

Kavanaugh replaced retired Justice Anthony Kennedy, a conservative noted for supporting gay rights, and could provide a pivotal vote on the issue. Kennedy wrote the court’s 5-4 2015 ruling legalizing gay marriage nationally, a landmark for U.S. gay rights, and its important 2003 ruling striking down laws criminalizing gay sex.

Slideshow ( 4 images )

Kavanaugh’s approach to gay rights is unknown, having not been involved in any major cases on the issue as an appeals court judge before becoming a justice. Trump’s other Supreme Court appointee is fellow conservative Neil Gorsuch.

Trump, a Republican with strong support among evangelical Christian voters, has taken aim at gay rights and transgender rights. His Justice Department at the Supreme Court supported the right of certain businesses to refuse to serve gay people on the basis of religious objections to gay marriage.

His administration also restricted transgender service members in the military and rescinded protections regarding bathroom access for transgender students in public schools.

The legal fight centers on the definition of “sex” in Title VII. The plaintiffs in the cases, along with civil rights groups and many large companies, have argued that discriminating against gay and transgender workers is inherently based on their sex and thus is unlawful.

Trump’s Justice Department and the employers in the cases have argued Congress did not mean for Title VII to protect gay and transgender people when it passed the law.

‘WIDESPREAD CONSEQUENCES’

“Neither government agencies nor the courts have authority to rewrite federal law by replacing ‘sex’ with ‘gender identity’ - a change with widespread consequences for everyone,” said John Bursch, a lawyer with the conservative Christian legal group Alliance Defending Freedom, which represents the funeral home.

Zarda, fired after revealing his sexual orientation in 2010, died in a 2014 accident while participating in a form of skydiving. His sister, Melissa Zarda, and his partner, Bill Moore, continued the litigation on behalf of his estate.

Slideshow ( 4 images )

“I hope the Supreme Court will see that what happened to my brother was wrong,” Melissa Zarda said.

The New York-based 2nd U.S. Circuit Court of Appeals in 2018 sided with Zarda after a trial judge threw out his original claim.

Bostock worked for Clayton County, south of Atlanta, from 2003 until being fired in 2013 after he started participating in a gay recreational softball league called the “Hotlanta Softball League.” The county said he was fired following an audit of the program he managed. His lawsuit was tossed out the Atlanta-based 11th U.S. Circuit Court of Appeals.

Harris Funeral Homes, the employer in the transgender case, is owned by Thomas Rost, who identifies himself as a devout Christian. It has a sex-specific dress code requiring male employees to wear suits and women to wear dresses or skirts. Stephens, formerly named Anthony Stephens, joined the company in 2007.

After being fired when he announced plans to transition from male to female, Stephens turned to the EEOC, which sued on Stephens’ behalf in 2014.

The Cincinnati-based 6th U.S. Circuit Court of Appeals in 2018 rejected Rost’s argument that he was protected by a law called the Religious Freedom Restoration Act that bars the government from burdening an individual’s religious practice.