|Not official use.|
The Court noted that the protected classes under Title VII do not include transgender employees; but that doesn't really get us very far. You see, the case involved a sex-specific dress code and a male employee who was transitioning to female. Dress codes present particularly thorny issues under a "gender stereotyping" theory. So, even if Title VII does not specifically protect transgender employees, employers may still face liability for imposing gender stereotypes on employees regardless of whether they are male, female, transitioning, or transgender.
Here, however, the Court dismissed the claims based on the Religious Freedom Restoration Act (RFRA). The gist of the decision is that requiring the employer (a funeral home) to allow its biologically male employee to wear a skirt would impose a substantial burden on the employer's religious beliefs. Under RFRA, the EEOC could still win by showing a compelling government interest, and that it is using the least restrictive means to attain it. The Court assumed the former but held that the EEOC failed to establish the latter. Eugene Volokh has some interesting analysis here.
On top of the Harris decision, a federal court in Texas issued a nationwide injunction blocking the President's Title IX guidance to schools on transgender bathroom usage.
I'm sure we haven't heard the last of these issues.