The 7th U.S. Circuit Court of Appeals in Chicago surprised some legal experts when it decided to hear arguments en banc in the Hively v. Ivy Tech Community College case. At stake is the clarification of years of inconsistent precedent – and a potential sea change in federal protections for LGBT employees.

The case is pursued by former Ivy Tech adjunct professor Kimberly Hively, who claims the college denied her job opportunities and ended her contract largely due to her sexual orientation. Rights and protections granted under Title VII are at the core of the case, which protects employees against sex discrimination at work. The EEOC argues that the statute includes sexual orientation. Years of court precedent do not agree.

But the fact that the court picked up the case may be a sign of change, experts told HR Dive. Barry Hartstein, Co-chair of the EEO & Diversity Practice Group and Shareholder at Littler Mendelson in Chicago, noted that with a Congress that is unlikely to make legislation, courts will be forced to wrangle with the issue alone.

What do courts do when American culture – becoming more accepting of LGBT identities – and precedent clash? We may find out.

The paradox at stake: Protection in the workplace

This issue is at the core of a paradox that has plagued the legal community for the past decade. On top of the EEOC taking the strong position that sexual orientation discrimination is discrimination on the basis of gender, the Supreme Court ruled in favor of protections for LGBT persons in 2015 concerning same-sex marriage rights.

But Title VII is a statute bound to different precedent, which puts the court in a difficult place. A similar case is playing out in the 11th U.S. Circuit Court as well.

"My interpretation is very consistent with [the EEOC's,]" Aimee Delaney, a labor and employment attorney at Hinshaw & Culbertson, told HR Dive. "But if you want a court to decide an issue of law, it has to be on the law written."

The way the law has developed is "peculiar," Hartstein said. If a woman was told she doesn't "act like a woman" and is therefore treated differently because of it, a court could call that inappropriate sexual stereotyping and therefore unlawful. But if a woman acts in a similar way and also happens to be gay, she might not be protected by the same law.

The mantra "Married on Sunday, fired on Monday" emerged to explain the awkward legal discrepancy at play.

"Some courts are willing to value the statute as the EEOC's interprets it," Hartstein said. "Can a court in good conscience do that, or are they bound by legislative history?"

The 7th circuit case is currently not a ruling on the merits, Delaney noted, and is instead establishing whether or not a case is at hand. The fact that the 7th circuit agreed to rehear the case could be a sign that the judges want a way to reconsider.

The power of changing times

The 7th circuit court's actions were unexpected, Delaney said. But the judges of the original case, including Judge Ilana Rovner, seemed to express "frustration" with the current state of the law. The EEOC and others have claimed that simply standing by precedent is "short-sighted," and Judge Rovner seemed to pick up on that in her analysis, Hartstein said.

"The climate is much different for this issue," Delaney noted. "What happens with the new SCOTUS and administration? Many state statutes do cover sexual orientation and transgender status, so it isn't odd, but it isn't in the federal statute."

Shifting cultural consciousness and the place of the court is an old problem in jurisprudence, and it no doubt will come up here.

What should employers do?

Next steps involve waiting on the court to decide whether to allow the case to continue. This case could change protections on a federal level, but employers should already be following how the EEOC interprets the law to ensure strongest compliance. When considering company anti-discrimination policies, do not omit those pertaining to gender identity and sexual orientation.

"Many states mandate it, and regardless of how this evolves, that is what is important," Hartstein said.