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He wrote the book. He is allowed to do that. He handed it out. Why is that against the rules? Did he do it under the auspices of the city? Or did he do it on his own?
Because it declares a class of people which HR probably has a policy about (I dont know, but sexual orientation is becoming more and more a protected status by HR departments every day, so I think its a safe assumption that the city HR dept has it covered) to be evil or immoral. This creates a hostile or uncomfortable workplace environment.
Thats really all there is to it in this case as far as I can see and its pretty cut and dry.