NHS Fife allowed a transgender doctor to use female-only changing facilities after they failed to conduct a "legally required assessment" into its potential impact on female employees.
It is understood that the health board has admitted it did not carry out the assessment, which experts have described as a "very serious" breach of its legal obligations.
The Equality and Human Rights Commission (EHRC) has now ordered NHS Fife to produce the equality impact assessment it should have completed before finalising its policy, The Herald reports.
The case emerged after nurse Sandie Peggie was accused of misconduct for challenging the presence of Dr Beth Upton - a biological man who identifies as a woman - in female facilities at Victoria Hospital in Kirkcaldy.
The case emerged after nurse Sandie Peggie was accused of misconduct for challenging the presence of Dr Beth Upton - who is a biological man who identifies as a woman - in female facilities at a hospital
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Peggie's solicitor Margaret Gribbon said she had requested the assessment last August in preparation for a landmark employment tribunal.
When asked whether an assessment was undertaken before allowing Upton to use the female changing room, the health board simply replied: "No."
The tribunal in Dundee heard this month that Peggie was uncomfortable sharing female facilities with the transgender doctor, following an incident where the nurse needed to use the changing rooms urgently due to heavy menstrual bleeding.
Despite this, NHS Fife insisted that Upton had a "right" to access female single-sex spaces as the doctor claims to "identify as a woman" - although it is understood that the doctor did not even have a gender recognition certificate at the time of the incident.
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Gribbon noted: "The board did not carry out any equality impact or risk assessments before deciding to permit Dr Upton to use the female changing room and confirmed this to us in September 2024."
The public might find it "alarming" that an organisation failing to comply with statutory equality duties has government confidence, she suggested.
EHRC chairman Baroness Falkner wrote to NHS Fife on Friday to "remind" it of legal obligations regarding single-sex spaces, highlighting the Workplace Regulations 1992.
The rules state that changing rooms are not suitable "unless they include separate facilities for, or separate use of facilities by, men and women where necessary for reasons of propriety".
The EHRC also requested NHS Fife provide a copy of any equality impact assessment relating to staff changing facilities after the commission was unable to find this information on the board's website.
The EHRC also requested NHS Fife provide a copy of any equality impact assessment relating to staff changing facilities after the commission was unable to find this information on the board's website
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The watchdog has also demanded a meeting with SNP Health Secretary Neil Gray over forthcoming NHS Scotland guidance on transgender issues.
Dr Michael Foran, who lecutres on matters of public law at the University of Glasgow, told The Herald the health board's failure to produce impact assessments was "very serious indeed".
"It is very clear at this point that, regardless of the substantive merits of the case being taken against it, NHS Fife has consistently failed to comply with its legal obligations," he said.
The EHRC's intervention comes amid controversy over forthcoming NHS Scotland guidance on transgender issues.
It emerged last week that this guidance, to be implemented across Scottish NHS, warns that preventing a trans person from using their "preferred facilities" could amount to "unlawful discrimination on the grounds of gender reassignment".
A spokesperson for NHS Fife said: "We acknowledge the letter from the Equality and Human Rights Commission and note its contents. We will respond fully to the Commission in due course.
"It would be inappropriate to comment further while the employment tribunal remains ongoing.”
