The decision enshrines discrimination against transgender people in law and provides easy justification for any business that wants to fire transgender employees.

A federal judge in Michigan ruled Thursday that a funeral home had the right to terminate a transgender employee after she transitioned, citing the religious convictions of the business owners.

The ruling is the latest to highlight the sweeping repercussions of the Supreme Court's controversial Hobby Lobby decision, in which a sharply divided court determined that a business owner's "religious freedom" allows that business to deny certain services or benefits to its employees, if those things violate the business owner's "sincerely held religious beliefs."

Thursday's decision was handed down by U.S. District Judge Sean F. Cox in a case known in legal shorthand as EEOC v. Harris Funeral Homes. Trans advocates are already framing the ruling as a major setback for the safety and security of transgender Americans.

The ruling sets a dangerous legal precedent for trans people employed around the country and highlights the need for employment protections for transgender people at the federal level.

The case itself stems from an ongoing dispute between Aimee Stephens and the Harris Funeral home in Detroit. Stephens was a funeral director at Harris Funeral Home from 2007 until 2013. In August of 2013, she informed her employer that she was transgender, that she would be undergoing gender-affirming surgery, and that she planned to return to work presenting as a woman. Two weeks later, she was fired by funeral home's owner, Thomas Rost, allegedly because she intended to dress according to the company's female dress code.



After she was terminated, Stephens filed a complaint with Equal Employment Opportunity Commission for sex discrimination. The EEOC investigation sided with Stephens, finding that Rost and Harris Funeral Home had violated Title VII of Civil Rights Act of 1964 when firing Stephens because the "decision to fire Stephens was motivated by sex-based considerations."

In the past several years, the federal agency has increasingly interpreted existing prohibitions on discrimination based on sex to extend to discrimination based on gender identity. Stephens's case was one of two landmark suits filed by the EEOC in 2014 contending that Title VII already prohibits discrimination based on gender identity. Those lawsuits marked the first time the federal employment agency had initiated litigation on behalf of transgender workers.

But in his 56-page decision, Judge Cox dismissed the EEOC's suit in a summary judgment. Cox, appointed by President George W. Bush in 2006, ruled that because Title VII does not specifically enumerate protections agains discrimination based on gender identity or transgender status, the statute does not apply in Stephens's case.

"This Court previously rejected the EEOC’s position that it stated a Title VII claim by virtue of alleging that Stephens’s termination was due to transgender status or gender identity — because those are not protected classes," Cox wrote.

Cox also declared that because Rost has a sincerely held religious belief regarding the immutability of gender, allowing Stephens to follow the female dress code was an undue burden on Rost's free exercise of religion. Under the federal Religious Freedom Restoration Act and the precedent set by Burwell v. Hobby Lobby, Cox reasoned:

"The Court finds that the Funeral Home has shown that the burden is “substantial.” Rost has a sincere religious belief that it would be violating God’s commands if he were to permit an employee who was born a biological male to dress in a traditionally female skirt-suit at one of his funeral homes because doing so would support the idea that sex is a changeable social construct rather than an immutable God-given gift..To enforce Title VII … by requiring the Funeral Home to provide a skirt to and/or allow an employee born a biological male to wear a skirt at work would impose a substantial burden on the ability of Rost to conduct his business in accordance with his sincerely-held religious beliefs."

With several federal court cases at various levels of appeal already focusing on transgender rights, Cox's legal reasoning sets an extraordinarily concerning precedent for numerous reasons. If the following faulty logic is upheld on appeal, it could become guiding legal principle for how transgender people are to be treated at work, and it represents a powerful rebuke to the emerging case law that suggests Title VII includes gender identity.

1. An employer's religious freedom trumps an employee's right to be accurately identified at work.



First and foremost, Cox's ruling implies that a particular religious view about the immutability of sex trumps the wide acceptance of existence of transgender people by the scientific and medical community. Even under the relatively conservative rules in Michigan, having gender-affirming surgeries would have allowed Stephens to be legally considered female and designated as such on both her driver's license and her birth certificate. Her medical records would have been updated to designate her as female. But despite the legal and medical recognition of Stephens's identity as female, the court is allowing Rost's personal religious conviction that sex is God-given and immutable to override the official designation of Stephens's gender.

Essentially, the court determined that because Rost's faith does not allow him to recognize transgender people, his business does not have to recognize them either. That represents a terrifying and dangerous encroachment on the legitimacy of trans people's existence, even where they have been able to win some trans-affirming policies regarding official documentation.

2. Gendered dress codes have an invisible "as assigned at birth" postscript.

Cox's ruling also functions a backdoor legal endorsement of discrimination against trans people by using gendered dress codes. One of Rost's key defenses was that Stephens was not fired for being transgender but rather for refusing to follow the dress code for the sex she was assigned at birth. Cox ruled that because Rost's religious convictions lead him to believe that Stephens is male, he is allowed to require her to follow the male dress code and can fire her for not adhering to the gendered dress code he believes best suits her.

Courts have routinely upheld the legality of gendered dress codes, as long as the particular burdens of each dress code are not imbalanced toward one sex or another. But this decision could functionally allow any employer to use an existing gendered dress code as a way to terminate transgender employees. Rather than directly objecting to a transgender employee's identity, an employer now has some legal backing to claim that "dress code violations" led to an employee's termination, even if the employee was adhering to the dress code that corresponds with their gender identity. This particularly insidious line of reasoning could carve out a special "exemption" for gendered dress codes, even if other decisions explicitly protect transgender people's right to access gendered spaces like restrooms and locker rooms.

3. Businesses do not have to tolerate the existence (or employment) of people whose identities contradict the business owner's "sincerely held religious beliefs."



Cox's decision is also a concerning reentrenchment of ideas born out of Hobby Lobby about the free exercise of religion through a business. The Hobby Lobby decision held that a company could not be compelled to provide a benefit for its employees that violated the company's sincerely held religious beliefs.

Cox's opinion expands that reasoning to hold that a company cannot even be compelled to tolerate the presence of an individual employee who is not conducting themselves in accordance with the company's religious views. At the very least, Cox's decision determines that a company has the right to compel its employees to ascribe to its particular views about gender — even if those beliefs fly in the face of both statutory and medical norms. As long as the business states that those beliefs are sincerely held matters of faith, it can compel employees to comply with its own particular understanding of gender. This massive expansion regarding the concept of free exercise of religion is all but designed to seriously infringe on the personal autonomy and self-determination of transgender people.

The dangers for the transgender community here extend far beyond merely the ideological arguments about the immutability of sex. Transgender people already face disturbingly high levels of discrimination, unemployment, poverty, and homelessness. The majority of states in the U.S. still have no laws specifically preventing employers from firing transgender people simply for being who they are. And despite the best efforts of the Obama administration, there are still no federal statues that explicitly identify trans people as a class protected from employment discrimination.

Numerous LGBT rights groups have also been quick to criticize Cox's decision. Human Rights Campaign legal director Sarah Warbelow said in a statement:

"This is a reckless ruling against a woman who was fired simply because she is transgender. Judge Cox’s deeply disappointing decision has the possibility of setting an incredibly dangerous precedent that purported religious beliefs can be used as an excuse to violate non-discrimination laws. It has the potential of opening a Pandora's box of discrimination against a wide range of vulnerable communities. We are incredibly concerned about the implications."



Transgender Legal Defense Fund executive director Jillian Weiss was similarly critical. In a statement, she said:

"This ruling shows the dangers inherent in so-called religious exemptions that create enormous loopholes, threatening equality laws that protect vulnerable people. We hope this decision is overturned on appeal. … This ruling shows the dangers inherent in so-called religious exemptions that create enormous loopholes, threatening equality laws that protect vulnerable people. We hope this decision is overturned on appeal.”

The EEOC attorneys were also unhappy with the judge's decision and have indicated that they are exploring the possibility of appeal. In an interview with NBC News, Stephens said she would abide by whatever decision the EEOC makes.