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U.S. Supreme Court Affirms Key Exceptions for Religious Employers

July 9, 2020

By Kalia J. Walker

U.S. Supreme Court Affirms Key Exceptions for Religious Employers
Yesterday the Supreme Court issued two decisions that carve out significant protections for religious organizations regarding employment discrimination claims and exceptions to the obligation of employers to provide their employees with contraception coverage. These rulings broaden First Amendment protections for religious institutions and private employers.

Our Lady of Guadalupe School v. Morrissey-Berru 
The Supreme Court clarified the scope of the so-called “ministerial exception.” The exception provides religious institutions with First Amendment protections regarding their employment decisions involving employees considered “ministers” by barring certain employment discrimination claims to avoid governmental encroachment on “matters of church government.”

In the consolidated cases of Our Lady of Guadalupe School v. Morrissey-Berru and St. James School v. Biel, the Supreme Court held that this exception barred two parochial school teachers from asserting  employment discrimination claims. One teacher claimed that her school unlawfully terminated her employment in favor of a younger applicant in violation of the Age Discrimination in Employment Act. The other alleged that she was let go after requesting a leave of absence for breast cancer treatment.

The Supreme Court previously had applied the ministerial exception to a parochial school teacher and ordained minister. In 2012, the Court held that this teacher could not sue her employer for employment discrimination, relying in part on the nature of her job duties, her title (“minister”), and the fact that she taught religion classes. 

In Morrissey –Berru, the Ninth Circuit Court of Appeals had applied Supreme Court precedent to reverse dismissal of the parochial school teacher’s claims. The Ninth Circuit held that although Morissey-Berru had important religious responsibilities in her role, she had a secular title (“Teacher”) and did not have any substantive religious training or ministerial background. Ultimately, the Ninth Circuit concluded that lower courts must consider both an employee’s job duties and ministerial status (e.g. holding oneself out as a minister) for the exception to apply.

In a 7-2 decision, the Supreme Court reversed the Ninth Circuit and held that the ministerial exception barred the lawsuits in this case.

The Court expressly rejected a checklist approach to the question of whether the “ministerial exception” applies. Writing for the majority, Justice Samuel Alito noted that the applicability of this exception focuses on an overall assessment of “what an employee does,” rather than a rigid formula. Although the teachers in Morrissey-Beru were not ministers, both “performed vital religious duties,” such as teaching religion in the classroom and praying with her students. In other words, the ministerial exception applied because “their schools expressly saw them as playing a vital part in carrying out the mission of the church, and the schools’ definition and explanation of their roles is important.”  teachers’ core responsibilities involved an essential role in fulfilling the church’s mission.

What does this mean for employers?
The Court’s decision affords religious institutions with greater discretion regarding employment-related decisions. Religious institutions should evaluate their employees’ job descriptions and duties to determine which employees are covered by the ministerial exception. Such employers should engage in a holistic, position-specific evaluation of whether particular employees’ job duties promote the organization’s religious mission. Finally, such employers should ensure that its conclusions are clearly communicated through job descriptions and applicable personnel policies.

Litte Sisters of the Poor Saints Peter and Paul Home v. Pennsylvania 
In these combined cases, the Supreme Court upheld a Trump administration rule that allows private employers to refuse to provide contraceptive coverage for employees based on moral or religious objections. 

The Affordable Care Act (ACA) requires most employers’ health insurance plans to provide access to free contraception for female employees. Religious institutions, however, are exempt from this mandate. In 2017, the Trump administration published rules that expanded this exemption to private employers (including publicly traded corporations) with religious or moral objections to providing contraception.

Pennsylvania and New Jersey contested the broadened exemption, arguing that the rule was invalid because the government lacked the “statutory authority…to promulgate the exemptions.” Accordingly, the question before the Court was whether the current administration had the authority to carve out religious and moral exemptions. Also in a 7-2 decision, the Court held that the Trump administration had the authority, as a matter of administrative law, to create these rules because the ACA gives “broad discretion” to government departments to “define preventive care and screenings and to create the religious and moral exemptions.” Justices Sotomayor and Ginsburg were the dissenting votes in both Little Sisters of the Poor and in Morrissey -Berru.

What does this mean for employers?
The Trump administration’s broad contraceptive exemptions remain in place.   However, absent future legislation, the specific rule at issue is subject to change. The Court’s opinion affords broad discretion to agencies to promulgate administrative rules. Just as the Trump administration was permitted to change Obama-era rules on contraceptive coverage, so too could other future administrations change the rules again. Therefore, the private employer mandate to provide contraceptive coverage may become dependent on the outcome of future election cycles.

 
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