Purpose There is scarcity in the literature, both empirically and theoretically, regarding the relationship between transgender discrimination and prostitution. This study aims to offer a new framework for conceptualizing workplace discrimination and prostitution by examining the mediating role of poverty in the relationship between discrimination and prostitution. Design/methodology/approach The conceptual framework of this study is based on the social identity theory and the theory of prostitution. Findings Transgender is a neglected group in society, and more often, they are the ones who are unable to find jobs and when employed, find it challenging to sustain their employment because of their gender identity. This leads them to be discriminated at their workplaces. Subsequently, they are forced to leave their workplace and settle to work as prostitutes for their economic survival. Research limitations/implications Further research should empirically test the design model. Practical implications Managers play an essential role in eliminating discrimination in the organization. Managers need to take measures in crafting gender-free and anti-discrimination policies. They take steps to design recruitment policies in which there is no need to disclose applicant identity. Social implications Discrimination, on the basis of gender identity, promotes a culture of hate, intolerance and economic inequality in society. Prostitution has devastating effects on society. Originality/value In the field of organizational behavior, discrimination as a factor of prostitution was not explored. This study provides a significant contribution to the transgender and discrimination literature along with the prostitution theory and the social identity theory by proposing a model that highlights discrimination as one of the factors that compel the transgender community to be involved in prostitution.