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EEOC Says Failure to Provide Contraceptive Coverage May Violate Title VII

    Client Alerts
  • July 25, 2014

In last month’s Hobby Lobby decision, the U.S. Supreme Court concluded that certain closely held corporations could escape the Affordable Care Act’s contraceptive mandate due to religious objections of their shareholders. Earlier this month, the Equal Employment Opportunity Commission suggested that employees denied contraceptive coverage by such employers may have a different avenue of legal attack.
In its new Enforcement Guidance on Pregnancy Discrimination and Related Issues, the EEOC states that employers can violate Title VII by offering health plans that exclude coverage contraceptives prescribed for birth control or for health reasons. Because only women can use prescription contraceptives, failure of the medical plan to offer such coverage constitutes sex discrimination under Title VII. Under Title VII, employers would not necessarily be required to pay for such contraceptive coverage, but they would have to cover its cost under the same terms applicable to other prescription drugs.
The Enforcement Guidance discusses the impact of Hobby Lobby on this legal position in a footnote. While acknowledging the precedence of religious beliefs over the ACA’s contraceptive mandate, the footnote states that the Court’s decision did not address the question of whether Title VII takes precedence over the Religious Freedom and Restoration Act. In its majority opinion in Hobby Lobby, the Supreme Court indicated that RFRA would not allow employers to exclude employees based on race, gender, etc.
This footnote appears to invite employees affected by Hobby Lobby to claim sex discrimination when employers restrict coverage of certain prescribed contraceptives, while not restricting access to medications for other non-pregnancy-related medical conditions. The EEOC does not discuss situations where the employer’s religious objections apply to some but not all forms of prescription birth control. While federal courts would eventually determine the question of sex discrimination under Title VII, pre-Hobby Lobby case law gives the EEOC a legal basis upon which to determine that health plan exclusions of coverage for prescription contraceptives violate federal civil rights laws.