Everybody seems to have their own take or understanding.
This is an interpretation of what HB2 says:

House Bill 2, or HB2 as it's usually identified, has generated national controversy for allegedly creating or fostering discrimination against transgender-identified and gay-identified citizens in North Carolina. Much of the criticism though, comes from media, LGBT activists and their allies, as well as large corporations that either haven't read the bill, or are counting on the public's lack of knowledge of the law's language, in order to discredit the religious freedom legislation.

The North Carolina Legislature convened an emergency session in March 2016 to respond to the passage of a local non-discrimination ordinance by the city council of Charlotte, which granted special rights on the basis of sexual orientation and gender identity. The ordinance went beyond existing state law and posed problems in the areas of privacy and public safety, as well as religious freedom. The problems with the type of ordinance passed by Charlotte, called a "SOGI" law, are detailed here.

HB2 Explained

So what does HB2 actually say?

The following three parts correspond to the bill's three primary sections, and you can follow along and verify this explanation at the link highlighted above.

Part I: Statewide Standards For Public (e.g., Government-Owned) Bathrooms And Changing Facilities

Multiple-Occupancy Facilities Restricted On The Basis Of Biological Sex.

HB2 requires citizens using government-owned, multiple occupancy restrooms/changing rooms (including public schools) to use the facility in keeping with their biological sex, defined as the condition of being male or female, as stated on their birth certificate:

"Public agencies [and local boards of education] shall require every multiple occupancy bathroom or changing facility to be designated for and only used by persons based on their biological sex."

Single-Occupancy Facilities Are Permitted.

The law does not prohibit the provision of single-occupancy facilities as an accommodation for anyone requesting it:

"Nothing in this section shall prohibit public agencies [or local boards of education] from providing accommodations such as single occupancy bathroom or changing facilities upon a person's request due to special circumstances …"

Why Does North Carolina Need A "Statewide" Policy?

Statewide policies such as HB2 allow North Carolina citizens to travel freely within the state with a common understanding of what to expect when they enter a government-owned restroom or locker room. There should be no unwelcome surprises based on different laws created by different cities and counties.

Private Businesses.

HB2 does not impact private businesses in the area of bathroom or changing facility requirements. Companies and businesses are free to establish whatever policies they wish in their facilities for their employees and customers.

Part II: Creates Statewide Standards For Government Contractors, Including Non-Discrimination

Like Part I, Part 2, dealing with government contractors ― those who bid on and perform government contracts for both the state and local governments ― establishes statewide standards pertaining to what contractors may be required to do with regard to their own employment policies ― including non-discrimination requirements ― for the duration of, and pertaining to, government contracts awarded in North Carolina, and preempts local ordinances related to the subject.


Beyond What The State Requirements Impose, However, Private Company Policies Remain Unaffected.

While working on government projects in North Carolina, contractors are free to create any internal employee policies for those projects that do not conflict with state law. If they desire, they can adopt non-discrimination policies that protect various classes of persons beyond what the state of North Carolina requires for them on government projects. But local governments are precluded from requiring them to do so.

Part III: State Non-Discrimination Law In Employment And Public Accommodations Is A Matter Of Statewide Concern, And State Law Preempts Local Nondiscrimination Ordinances

Employment Law.

The relevant portion of HB2 concerning employment non-discrimination requirements for business in North Carolina states:

"The General Assembly declares that the regulation of discriminatory practices in employment is properly an issue of general, statewide concern, such that this Article and other applicable provisions of the General Statutes supersede and preempt any ordinance, regulation, resolution or policy adopted or imposed by a unit of local government…"

The purpose behind statewide uniformity in non-discrimination law is to make it easy for businesses operating in the state to comply with the law without having to learn and deal with competing provisions in various cities and counties within the state. A business with offices in Raleigh and Charlotte, for example, would need to learn and comply with only one set of rules, making the business climate more encouraging, thus helping to improve the North Carolina economy.

Private Business Employment Policies Are Unaffected.

Nothing in HB2 prevents a private business from creating its own internal policies of non-discrimination that includes any groups it wants, LGBT or otherwise. Most of the major corporations that have publicly complained about HB2 already have internal policies that cover LGBT issues, so HB2 would presumably not affect them.

Public Accommodations.

Public accommodations are private businesses open to the public and/or doing business with the public, as well as government-owned public facilities. HB2 once again, as it did in Parts I and II of the bill, creates a statewide law that preempts local ordinances:

"The General Assembly declares that the regulation of discriminatory practices in places of public accommodation is properly an issue of general, statewide concern, such that this Article and other applicable provisions of the General Statutes supersede and preempt any ordinance…adopted or imposed by a unit of local government…"

Private Business Practices Are Unaffected.

HB2 sets a baseline for non-discrimination. Private businesses can set any standard above HB2's baseline that they desire for their employees and customers.

The Bottom Line

North Carolina Law Has Not Changed.

Prior to HB2, North Carolina public bathrooms and changing facilities were always restricted to male or female based on biology, and state law protected against discrimination in employment and public accommodations and government contracting on the basis of "race, religion, color, national origin, age, sex or handicap…" This is in keeping with federal civil rights law. The state's non-discrimination law is the same now, after HB2, as it was before HB2, except that HB2 amends the word "sex" to mean "biological sex."

HB2 Does Not Target Anyone For Discrimination.

It does not mention sexual orientation or gender identity. It does not limit private businesses from establishing their own policies in these matters. It merely re-states previous state law in a few key areas, and by reserving such law-making to the state legislature, it preempts local governments from creating a patchwork of inconsistent laws across the state. Such uniformity across the state prevents local governments from infringing the religious conscience of its citizens, and improves the overall economic climate for business growth.