North Carolina’s HB2

In March 2016, North Carolina’s Governor Pat McCrory signed into law HB2 or the Public Facility Privacy and Security Act. The Act requires that in government buildings individuals must use restrooms that correspond to the gender listed on their birth certificate rather than the gender they identify with.

HB2 also prohibits cities from enacting anti-discriminations laws and setting a local minimum wage. HB2 eliminated a state cause of action to enforce anti-discrimination statutes in state courts. Instead of filing a lawsuit directly in state court for discrimination, individuals would have to file their claims through the EEOC or state commission. However, on July 1, 2016, the North Carolina legislature voted to revise HB2 to restore the state cause of action for employment discrimination.

HB2 was enacted just before a local non-discrimination law was to go into effect in Charlotte, North Carolina. The local ordinance was passed in February 2016 and prohibited discrimination in public accommodations, vehicles for hire, and city contractors based on sexual orientation and gender identity.

On May 9, 2016, the US Department of Justice filed a lawsuit arguing that the HB2 violates federal law. There are several other lawsuits pending regarding HB2 including a lawsuit filed by the American Civil Liberties Union.

On July 8, 2016, 68 companies filed an amicus brief in the Justice Department lawsuit opposing HB2 and urging that the law be struck down. The companies argued that HB2 goes against company non-discrimination policies and that the bill is bad for business and alienates customers and employees. Some of the companies that joined in filing the brief were Apple, Intel, American Airlines, United Airlines, Hilton, Marriott, eBay, and Microsoft.

North Carolina’s HB2 has proved to be highly controversial and has received a wide range of responses from businesses and individuals around the country and even around the world. Although the actual amounts are difficult to determine, North Carolina has lost millions of dollars and thousands of jobs because of the bill. Some companies have stopped plans for expansion in North Carolina. For example, PayPal changed its plan and decided not to build a facility in Charlotte after HB2 was enacted. PayPal’s decision will likely cost North Carolina 400 jobs. Even the United Kingdom has issued a warning to the LGBT community about visiting the state.

Other states such as Arizona, Nevada, South Dakota, and Texas have proposed so called “bathroom bills” that did not pass. Bathroom bills are being considered in other states as well.

While the North Carolina law itself does not affect private businesses, businesses have been vocal about their position on HB2. Businesses can still implement their own anti-discrimination policies.

There is no federal law that prohibits workplace discrimination against LGBT individuals, however, federal agencies have identified LGBT individuals as part of protected classes. Business are subject to investigations by these federal agencies and should be aware of what individuals are considered to be part of a protected class.

For example, the EEOC enforces Title VII of the Civil Rights Act of 1964 prohibiting workplace discrimination and has extended sex discrimination to include transgender status.

Businesses should be aware of what the anti-discrimination laws are locally and on a national level and implement policies accordingly. Because of the recent developments, businesses need to stay current on the laws affecting LGBT employees and customers. There may also be state laws affecting these same issues.

If you have questions about company policies or how laws like HB2 might affect your business, contact the experienced employment law attorneys in Mesa at Denton Peterson Dunn, PLLC Our attorneys can assist you develop company policies to help mitigate the risk of discrimination suits in the future. Give us a call today!

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