The Supreme Court’s decision earlier this year excepting a teacher of secular subjects in a religious school from the reach of the ADA calls into question how far the courts will go in shielding religious institutions from the reach of federal employment laws.
When the United States Supreme Court earlier this year ruled in Hosanna-Tabor Evangelical Lutheran School v. Equal Opportunity Commission, et al.1 that the 1st Amendment free exercise of religion clause requires the recognition of a ministerial exception from the application of the discrimination provisions of the federal Americans with Disabilities Act, most commentators characterized the decision as a victory for religious freedom. The decision of the court was unanimous and mandated immunity for religious organizations from the laws that prohibit discrimination and retaliation in the workplace. Developments since then suggest the case may be one in a pattern of cases that are part of a broader movement to expand the rights of both religious and nonreligious corporations.
The Hosanna-Tabor decision raises issues of how far a ministerial exception extends and to what extent it immunizes religious organizations from liability for other types of statutorily required or prohibited conduct. Too broad an exception will immunize religious organizations under numerous neutral, generally applicable laws, such as those governing sexual abuse, unemployment compensation, employer social security deductions, and sales taxes, all of which have previously been applied to religious organizations. There is also concern the decision will become the basis for expansion of the Bill of Rights to include the free exercise of religion by corporations.
The “Called” Teacher Dismissed
Hosanna-Tabor Evangelical Lutheran Church and school is a religious corporation affiliated with the Lutheran Church—Missouri Synod. Cheryl Perich was a “called” teacher at the Hosanna-Tabor Church School. As such, she had completed a course of study that included classes required by the LCMS and had received a certificate of admission into the teaching ministry. Ms. Perich was “called” and hired as a teacher by Hosanna-Tabor. Her teaching duties were identical to those of other “contract” lay teachers who did not meet the LCMS teaching ministry requirements. Evidence indicated that Hosanna-Tabor did not require teachers to be “called” or even to be Lutheran. It also indicated that non-Lutheran teachers had identical responsibilities to Lutheran teachers, including teaching religion classes and leading chapel.2
In June, 2004, Perich became ill and was hospitalized. In the fall of 2004 Hosanna-Tabor administrators suggested that she take a disability leave for the school year; the principal assured her that she would “still have a job when she regained her health.” Perich wrote to the school principal early in January 2005, advising that she would be able to return to work in February with her doctor’s written release. However, Hosanna-Tabor refused to allow her to return to work and asked her to resign her call. When she refused to do so and filed a charge of discrimination and retaliation with the EEOC, the congregation voted to rescind her call and notified her of her termination. The firing was allegedly because she violated LCMS doctrine strongly disapproving of believers suing other believers in secular courts, especially when such suits involve a religious matter.
The EEOC filed a complaint against Hosanna-Tabor in the United States District Court for the Eastern District of Michigan, alleging one count of retaliation in violation of the ADA. Perich moved to intervene and filed her own complaint in the case. The district court granted summary judgment in favor of Hosanna-Tabor, dismissing Perich’s claim on the grounds that the court could not inquire into her claims of retaliation because they fell within the “ministerial exception” to the ADA. Perich sought reconsideration, which was denied. Both Perich and the EEOC then filed notices of appeal to the United States Court of Appeals for the 6th Circuit.3
The appellate court treated the dismissal of the case by the district court in a motion for summary judgment as a dismissal for lack of subject matter jurisdiction. In so doing, the court noted that “this Circuit has treated the ‘ministerial exception’ as jurisdictional in nature,” thereby holding that the application of the ministerial exception by the district court was a legal conclusion subject to de novo review rather than a finding of fact.4 The 6th Circuit recognized the existence of a “ministerial exception” to the application of the ADA, but held that it did not apply in this situation because the district court had found that Perich’s primary duties consisted of teaching secular subjects, using secular textbooks, without incorporating religion into the secular materials. Although Hosanna-Tabor satisfied the 6th Circuit that it was a “religious institution,” it failed to establish that its employment of the teacher was more secular than ministerial in nature. Thus, the Court of Appeals found the district court had erred in classifying Perich as a ministerial employee.5
Discussing the application of the ADA to religious employees, the 6th Circuit opinion noted that Congress intended the ADA to broadly protect employees of religious entities from retaliation on the job, subject only to a narrowly drawn religious exception. To illustrate, the court cited a report of the House of Representatives that gives an interesting hypothetical example:
[A]ssume that a Mormon organization wishes to hire only Mormons to perform certain jobs. If a person with a disability applies for the job, but is not a Mormon, the organization can refuse to hire him or her. However, if two Mormons apply for a job, one with a disability and one without a disability, the organization cannot discriminate against the applicant with the disability because of that person’s disability.6
The appellate court also cited the Code of Federal Regulations, which provides:
Religious organizations are not exempt from Title 1 of the ADA … . A religious [entity] may give a preference in employment to individuals of the particular religion, and may require that applicants and employees conform to the religious tenets of the organization. However, a religious organization may not discriminate against an individual who satisfies the permitted religious criteria because that individual is disabled.” 7
Thus, the court of appeals vacated the district court’s order entering summary judgment on behalf of the defendant and remanded the case with instructions that the district court make a finding on the merits in favor of Perich based upon her retaliation claim under the ADA. Hosanna-Tabor then requested the Supreme Court grant certiorari to hear the case, which it subsequently did.
The Ministerial Exception
In a 9-0 decision, the Supreme Court reversed the decision of the 6th Circuit Court of Appeals.8 Recognizing the existence of a constitutionally based “ministerial exception” to the application of the Americans with Disabilities Act, the court ruled against Cheryl Perich and the EEOC. Although the ruling of the court was unanimous, not all justices signed on to Chief Justice Roberts’ opinion. Justice Thomas and Justice Alito wrote concurring opinions, the latter of which Justice Kagan joined. Unlike the appeals court, which found a ministerial exception rooted in the 1st Amendment’s guarantees of religious freedom but then concluded that Perich did not qualify as a “minister” under the exception, the Supreme Court found the ministerial exception rooted in the 1st Amendment’s establishment and free exercise clauses and concluded that Perich qualified as a “minister” under the exception.
Whereas the 6th Circuit focused on Perich’s work and the fact her duties as a “called” teacher were identical to those of lay teachers, the Supreme Court focused on her classification by the church school as a minister and that the church school had extended a “call” to her. Chief Justice Roberts highlighted the formal title of “minister” given to Perich by the church, the substance reflected in that title, her own use of that title, and the important religious functions she performed for the church. He then cited three “errors” committed by the court of appeals: 1) failing to see any relevance in the fact that Perich was a commissioned minister; 2) giving too much weight to the fact that lay teachers at the school performed the same religious duties as Perich; and 3) placing too much emphasis on Perich’s performance of secular duties.
In his separate concurring opinion, Justice Thomas urged that the religion clauses of the Constitution require civil courts not only to apply the ministerial exception but to defer to a religious organization’s good-faith understanding of who qualifies as one of its ministers. For Justice Thomas, the evidence demonstrated that Hosanna-Tabor sincerely considered Perich a minister, which sufficed for him to conclude that her suit is barred by the ministerial exception. On the other hand, Justices Alito and Kagan thought the court’s opinion focused too much on Perich’s designation as a “commissioned minister.” They opined it would be a mistake to view the term “minister” or the concept of ordination as central to the issue of religious autonomy in cases such as this. They suggested instead that courts should focus on the function performed by persons who work for religious bodies. The two justices urged that the “ministerial” exception be applied to any “employee” who leads a religious organization, conducts worship services or important religious ceremonies or rituals, or serves as a messenger or teacher of its faith.
Scope of the Exception
None of the parties to the case argued against the existence of a 1st Amendment-based “ministerial” exception to federal discrimination laws. Rather, the issue was the scope of such an exception. All parties agreed that the ministerial exception serves an important interest in religious liberty. The exception serves the purpose of allowing religious organizations to practice their religion and convey their message without government interference, but at the same time, it thwarts the interests of society in ending discrimination. It fails to serve the exception’s purpose when it is applied to shield a religious entity from liability for discrimination or retaliation that is unrelated to religious ideology.9
In overturning the decision of the court of appeals and ruling in favor of Hosanna-Tabor, the Supreme Court granted a large shield to religious institutions. Circumstantial factual evidence suggested the motivation for Perich’s dismissal was pretextual and unrelated to the religious beliefs of the Hosanna-Tabor school and the Lutheran Church—Missouri Synod. That evidence was ignored by the Supreme Court. After finding that Ms. Perich was a ministerial employee, the court could have examined the evidence that suggested her termination was motivated by factors unrelated to religious beliefs or doctrines.
By ignoring the evidence suggesting a pretextual discharge of Ms. Perich, the Supreme Court went out of its way to establish a constitutionally based ministerial exception that is more broad than necessary. It could have permitted a limited judicial inquiry into the employer’s use of pretext in the discharge of the employee. Merely by claiming the decision relates to some sort of religious belief, religious employers may now implement otherwise prohibited decisions. Thus, the Supreme Court has now prevented wronged employees from even attempting to submit evidence showing pretextual reasons for termination. It is understandable that the Supreme Court would not want to resolve matters involving church doctrine. However, the court’s decision to defer to a religious organization simply because an employment dispute involves such an organization is baffling.
In other employment discrimination-related disputes, the Supreme Court has employed a burden-shifting framework in its analysis. For example, in Title VII cases involving secular employers, the courts use the framework established in McDonnell Douglas Corporation v. Green.10 Under the burden-shifting approach of McDonnell Douglas, the employee must first establish a prima facie case of discrimination. The employer must then produce evidence of a legitimate, nondiscriminatory reason for its actions. If the employer does so, the plaintiff must then present facts to demonstrate discrimination. This may be accomplished by showing that the employer’s explanation is insufficient and/or a pretext for discrimination.
The Supreme Court could have established a similar framework to evaluate allegedly pretextual decisions made by religious employers. Such an approach would allow courts to evaluate claims of pretext without becoming enmeshed in issues of religious doctrine. Such a limited scope of inquiry would not intrude into the internal organization or belief system of a religious institution. It would protect employees of religious institutions from employment discrimination without subverting the organization’s selection of its “ministers.”
When Congress enacted Title VII of the Civil Rights Act11 and Title I of the Americans with Disabilities Act12 it created defenses for religious organizations that allow them to discriminate against individuals on the basis of religion, even when hiring for nonministerial positions. As the 6th Circuit noted in its opinion, Congress clearly intended for the ADA to apply to religious employers. A safe-harbor that applies to conduct not motivated by religion undermines the will of Congress in combating discrimination. In effect, the Supreme Court held in its decision that it is fair and appropriate to permit a religious employer to engage in otherwise illegal discrimination. Because Hosanna-Tabor argued that its religious doctrine opposed suits in civil court, the Supreme Court in effect held the 1st Amendment allows a religious organization to adopt internal policies that ignore and exempt it from otherwise applicable civil law. In other words, the decision allows religious organizations themselves to decide which civil laws they wish to obey and which civil laws they wish to ignore and provides that under the 1st Amendment courts have no power to review those decisions.
Unanswered questions that follow from the decision of the Supreme Court include whether the “ministerial exception” applies to organizations other than churches. If so, the next question becomes when an organization is sufficiently religious in nature to qualify for the exception. Can the exception be invoked by a for-profit organization? Many churches run “for-profit” businesses such as publishing houses for both religious and nonreligious reasons. Does the exception apply to these businesses? Also, is the “ministerial exception” a jurisdictional bar to a claim? The district court found that it was; the court of appeals found that it was not. Did the Supreme Court find that it was a jurisdictional bar?
Despite the ADA’s express prohibition of retaliation against employees who report or complain of discrimination in the workplace, and despite congressional intent that the ADA apply to religious employers with only a limited, Title VII-based exception, in Hosanna-Tabor the Supreme Court established a constitutionally based “ministerial” exception from the application of federal employment discrimination laws. The broad exception established in this case appears to exempt religious employers from a federal statutory mandate that Congress clearly intended to apply to these employers. Critics of the Supreme Court opinion point out that a commitment to the eradication of discrimination and the maintaining of 1st Amendment guarantees can coexist. Trial courts could have been allowed to review discrimination claims on the merits with sensitivity to 1st Amendment concerns.
The court’s decision is troubling in that it opens the door to the exemption of religious institutions from other statutory mandates. Indeed, the Becket Fund13 has already raised the issue with regard to separately incorporated nonprofit universities and the EWTN television network, contending that these institutions should be exempt from provisions of the Patient Protection and Affordable Health Care Act14 that they find are morally objectionable. Some say the Hosanna-Tabor decision may signal the Supreme Court’s willingness to exempt religious institutions from other employment law, or perhaps to extend the free exercise of religion clause to include corporations.
Since the decision in Hosanna-Tabor, the Becket Fund has initiated challenges to administrative rules promulgated by the Department of Health and Human Services under the Patient Protection and Affordable Care Act (“PPACA”). Becket is making these challenges for nonprofit corporations in the cases of Wheaton College v. Sibelius, Ave Maria University v. Sibelius, EWTN v. Sibelius, and Belmont Abbey College v. Sibelius. They are also challenging these same HHS rules for a business corporation in the case of Hobby Lobby v. Sibelius.15 All of these cases posit the theory that corporations are guaranteed 1st Amendment free exercise of religion rights just as corporations are now guaranteed free speech rights under Citizens United v. Federal Election Commission.16
Rather than settling issues on the exception of religious institutions from statutory mandates, Hosanna-Tabor raises questions on the power of courts to apply civil law to churches and other religious organizations. Although the intent of the decision was to distance courts from disputes involving church administration and beliefs, future cases could result in more rather than less court entanglement in issues of religious dogma.
Georgia Holmes, M.A., J.D,. is Professor of Accounting and Business Law at Minnesota State University, Mankato, teaching in the MBA program. Penny Herickhoff, J.D., LL.M., is Professor of Business Law at Minnesota State University, Mankato, teaching in the MBA program.
1 132 S.Ct. 694 (2012).
2 EEOC v. Hosanna-Tabor Evangelical Lutheran Church & School, 597 F. 3d 769 (6th Cir. 2010) at 773.
3 Id. at 773-776.
4 Id.at 776.
5 Id. at 780.
6 H.R. Rep. No. 485 part 2, 101st Cong., 2d Sess. 76-77 (1990).
7 29 C.F.R. Pt. 1630, App. §1630.16(a).
8 Hosanna-Tabor Evangelical Lutheran Church and School, Petitioner, v. Equal Employment Opportunity Commission, et al., 2012 WL 75047, 132 S.Ct. 694 (2012).
9 See, Brief of Americans United for Separation of Church and State, American Civil Liberties Union, ACLU of Michigan, National Council of Jewish Women, Sikh Council on Religion and Education, and Unitarian Universalist Association as Amici Curiae In Support of Respondents at 3.
10 411 U.S. 792 (1973).
11 42 U.S.C. §2000e-1(a).
12 42 U.S. C. §12113(d)
13 The Becket Fund for Religious Liberty, http://www.becketfund.org/. The Fund represented Hosanna-Tabor in its suit against the EEOC and its website includes information about the fund’s various lawsuits, including links to pleadings and other court documents.
14 Patient Protection and Affordable Care Act, Pub. L. 111-148, 124 Stat. 119, to be codified as amended at scattered sections of the Internal Revenue Code and in 42 U.S.C.
15 In Hobby Lobby v. Sibelius, the Becket Fund contends the corporation should be exempt from PPACA regulations because its owners should be able to carry out the corporation’s mission in a way consistent with its owner’s religious principles. See, supra, n. 13.
16 558 U.S. 310 (2010).