President Donald Trump’s administration Sept. 26 found itself on both sides of the debate over whether a federal ban on sex discrimination in the workplace includes sexual orientation bias.

Equal Employment Opportunity Commission lawyer Jeremy Horowitz told the U.S. Court of Appeals for the Second Circuit that sexual orientation discrimination is a form of sex bias already covered under federal law. Justice Department attorney Hashim Mooppan, however, urged the court to take the opposite position—that Congress didn’t intend to include...