New Department of Labor “LGBT” Rule Published; Labor Lacks Answers on Transgender Exclusions in Health Insurance

Today, the Department of Labor announced publication of its final rule implementing Executive Order 13,672 of July 21, 2014, which required the Department to publish rules prohibiting Federal contractors from discriminating on the basis of sexual orientation or gender identity (an additional press release is available).  The rule further reinforces existing law and supplements the EEOC’s decision in Macy v. Holder:  discrimination on the basis of sexual orientation and gender identity is illegal.

Since the rule failed to address health insurance, I called the Department of Labor’s Office of Federal Contract Compliance Programs.  After a transfer, I wanted to make sure I was speaking with the right people.

Emily:  I’m not actually sure which department I’m speaking with.

OFCCP: I’m in the national office at OFCCP, in the policy division.  We’re pretty much it.

I asked the OFCCP compliance officer:

Emily:  If a insurance provider is, or rather, if an employer is providing insurance that discriminates on one of the protected bases, would that be prohibited by this regulation.

[some conversation ensues about who the proper person to answer that question would be; the OFCCP compliance officer eventually puts me on hold to see if there is a prepared answer]:

OFCCP:  Emily?

Emily:  Yes.

OFCCP:  OK, I’m so sorry to keep you on hold for so long.

Emily:  Totally understandable.

OFCCP:  But I wanted to clarify, you know, to make sure, and basically the only thing we can say at the moment that it applies the same way our other rules apply in terms of how, essentially, terms and conditions of employment apply.

Emily:  Right.

OFCCP:  And that includes benefits such as health insurance.

Emily:  Right.  But the Department of Labor is not willing at this time to state that it is legal, or… let me back up, state that it is discriminatory or not discriminatory to deny a claim solely on the basis that a person is transgender?

OFCCP:  As I say, if it’s the same benefit, it ties to the same sort of benefit with health insurance.

Emily:  Right, but Department of Labor does not have a definitive legal opinion on that question.


[additional conversation occurs about how to obtain an agency statement of policy on that question]:

Emily:  I absolutely understand if it’s the case that you don’t have an opinion yet.

OFCCP:  Exactly.  The rule hasn’t even been published yet; it won’t be published until Friday.

[more conversation occurs about contacting the individual named in the rule, when the compliance officer states]:

OFCCP:  Unfortunately, at the moment all we can say is just basics of-

Emily: Yup.

OFCCP:  If it’s an employment benefit and it’s offered to everybody else and applies to everybody else it has to apply the same way here.  That’s the short answer.

Here’s a fact pattern: what would Department of Labor say about CareFirst (a Federal contractor) and its insurance policies (including the policies for Federal employees)?

CareFirst:  Commonwealth of Virginia, OK: for transgender surgery, it’s not going to be covered.

[discussion of hormone replacement therapy, leading to time on hold]

CareFirst:  Hormone replacement therapy?

Emily:  Yes ma’am.

CareFirst:  It’s not going to be… hormone replacement therapy, it doesn’t look like that’s going to be covered either. Anything that’s related to that transgender, it’s not going to be covered.

I plan to ask the Department of Labor that very question.  It will be interesting to hear their response.