On Wednesday night, the North Carolina General Assembly passed House Bill (HB) 2, which was then signed by Governor Pat McCrory. While HB 2 was prompted by the desire to overturn Charlotte’s recently enacted ordinance that banned discrimination against LGBT people in the provision of public accommodations and allowed transgender individuals to use the bathroom of their choice, its actual scope is much wider than that. The newly enacted law has the following provisions:
The law prevents local governments from imposing any requirement on employers pertaining to the compensation of employees, such as minimum wages, hours of labor, benefits, or leave. This means cities and counties can’t enact “living wage” ordinances or require paid leave, as has been done in other parts of the country.
The law prohibits local governments from enacting ordinances that prohibit employment discrimination. Thus, local ordinances prohibiting discrimination based on sexual orientation or any other factor are not allowed.
The law amends the North Carolina Equal Employment Practices Act (NCEEPA) by clarifying that discrimination against a person’s “biological sex” (not just “sex”) is not permitted. Biological sex is defined as the sex that is stated on the person’s birth certificate.
The law further states that the NCEEPA, while a statement of public policy, does not create any statutory or common-law private cause of action, and no person may bring any civil action based on it. This provision means that common-law claims for wrongful discharge in violation of public policy, which have become quite common in the area of employment law litigation, can’t be based on the NCEEPA. Of course, pursuing federal discrimination claims is still an available avenue.
The law prevents local governments from imposing antidiscrimination ordinances with respect to businesses that are places of public accommodation. This is the provision directly targeted at the Charlotte ordinance.
The law provides requirements for school districts and government agencies on the use of restrooms. Essentially, an individual must use the bathroom designated for his or her biological sex.
While the national attention this law has drawn has been focused on LGBT rights, the restrictions placed on local governments go much deeper than that. You can read the bill here.
Richard Rainey is a labor and employment attorney with extensive experience litigating employment disputes on behalf of employers in the courtroom and before administrative agencies such as the Equal Employment Opportunity Commission, the National Labor Relations Board and the US and N.C. Department of Labor. His litigation practice also includes actions involving covenants not to compete, theft of trade secrets, unfair competition, employee raiding, fair housing and equal credit. Rainey practices in Womble Carlyle’s Charlotte, N.C. office.