Dive Brief:

• In an 8-3 decision, the U.S. Court of Appeals for the 7th Circuit ruled that Title VII of the Civil Rights Act protects employees from discrimination on the basis of sexual orientation, the Associated Press reports.
• The outcome of the case, Hively v. Ivy Tech, largely hinged on the definition of "sex" in the context of Title VII's provision against discrimination based on "race, color, religion, national origin or sex." While previous courts have ruled the term referred only to whether a worker is male or female, the 7th circuit has effectively opted to expand that definition to include sexual orientation. 
• The ruling now sets up a likely hearing before the U.S. Supreme Court, after the Court of Appeals for the 2nd Circuit ruled the opposite, that Title VII does not cover sexual orientation bias, in a separate case last week. 

Dive Insight:

It's been a bizarre journey for Hively, legally speaking, and by all indications, the battle is not yet over. A smaller, three-judge panel of the same 7th Circuit originally ruled in favor of the defendant, Ivy Tech Community College, in July 2016.

Then, in what one observer termed a "rare" decision, the same court decided in November to rehear the case. Suddenly, the case became one of the most significant employment law decisions on the docket in 2017, potentially reshaping the legal standard around what some consider to be a paradoxical Title VII issue.

The Chicago court's decision in Hively comes a week after the 2nd Circuit Court of Appeals ruled — in Christiansen v. Omnicom Group, Inc. — that Title VII does not protect employees from discrimination on the basis of sexual orientation. It followed a similar ruling by the 11th Circuit Court of Appeals in 2000.

Now things get interesting. The rulings will most likely be condensed and presented before the U.S. Supreme Court later in the year. This would be a landmark ruling for both LGBT advocates and employers. And it's all the more uncertain given that SCOTUS is still short one justice. President Donald Trump's nominee, Neil Gorsuch, could potentially be facing a Democratic filibuster over confirmation by the Senate.

How Gorsuch would tip the scales on this ruling is an unknown. Sources who spoke with HR Dive called him an "originalist" who believes the court should prevent intentional discrimination by employers, but should not act as a super-personnel department for the private sector.

If the courts rule in favor of Hively, it could create complications for employers with regard to religious accommodations and other discrimination procedures. HR execs will want to stay closely tuned to this case moving forward.