Supreme Court Rules in Favor of Religious Employers

Two cases were decided by the Supreme Court of the United States during June and July 2020 with rulings that could have negatively affected a religious organization’s ability to make employment decisions autonomously and in accordance with its sincerely held beliefs.

Bostock v. Clayton County, Georgia – June 15, 2020
The Supreme Court held in a 6-3 decision that employment discrimination based on an employee’s sexual orientation or transgender status violates Title VII of the Civil Rights Act of 1964. Title VII is a federal law that prohibits employers with 15 or more employees from discriminating in their employment practices on the basis of race, color, religion, sex, and national origin.

Note: This case raised questions for religious employers regarding the ability to stand by their sincerely held beliefs.

Our Lady of Guadalupe School v. Morrissey-Berru – July 8, 2020
The Supreme Court held in a 7-2 ruling that religious institutions are exempt from most employment discrimination claims when it comes to ministerial employees. This case reaffirmed and strengthened the ministerial exception previously recognized by the Supreme Court in Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC in 2012.

Employment Discrimination Rulings and Laws

Bostock v. Clayton County, Georgia, was a consolidation of three different cases where employers terminated employees, in part, on the basis of their sexual orientation or gender identity. The issue before the Supreme Court was whether the prohibition against sex discrimination in employment under Title VII encompasses discrimination based on an individual’s sexual orientation or gender identity.

The Supreme Court determined that “discrimination based on homosexuality or transgender status necessarily entails discrimination based on sex” and “an employer who fires an individual merely for being gay or transgender defies the law.” In other words, Title VII’s ban on sex discrimination includes sexual orientation and transgender status. Even though sexual orientation and gender identity discrimination are now recognized under federal law for the first time, many states and municipalities have had sexual orientation and gender identity non-discrimination laws for years.

Also, of note, all three of the consolidated cases involved for profit businesses that had terminated homosexual or transgender employees. This raised questions regarding whether the ruling applies equally to religious organizations. The Court stated, “we are deeply concerned with preserving the promise of the free exercise of religion enshrined in our Constitution; that guarantee lies at the heart of our pluralistic society.”

The Court discussed the following three possible defenses to Title VII claims available to religious organizations:

  • Title VII’s religious exemption. Title VII includes an express exemption for religious organizations so they are not forced to violate their religious convictions in hiring and firing decision.  Ministries can likely point to this exemption in making employment decisions on the basis of their sincerely held beliefs and giving preference to individuals who share the same doctrinal beliefs.
  • The First Amendment and the “Ministerial Exception.” In Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC, the U.S. Supreme Court formally recognized a ministerial exception for the first time. The ministerial exception permits religious organizations to make hiring and firing decisions based on the organization’s beliefs and practices. The ruling granted greater autonomy to ministries in making employment-related decisions, but it did not completely answer the question of which employee roles qualify for purposes of the ministerial exception.
  • Religious Freedom Restoration Act of 1993. The Religious Freedom Restoration Act of 1993 (RFRA) prohibits the federal government from substantially burdening a person’s exercise of religion. The government can override RFRA if it has a compelling interest, but it must do so in the least restrictive way. The government must offer a high level of proof before it burdens a person’s free exercise of religion.  

Although religious liberty was discussed in Bostock, the Court’s holding did not definitively settle if and how those exceptions may apply. The court merely mentioned other avenues that ministries could pursue with employment decisions based on sincerely held beliefs.

Further Clarification – Ministerial Exception Strengthened

Just a few weeks after deciding Bostock, the Supreme Court issued a ruling in Our Lady of Guadalupe School v. Morrissey-Berru. Our Lady involved two consolidated employment discrimination cases. In one case, a Catholic elementary school teacher sued under the Americans with Disabilities Act, claiming she was let go from the school after developing breast cancer. She requested medical leave to undergo chemotherapy. The school said that she was terminated because of poor work performance, which included a failure to observe the planned curriculum and keep an orderly classroom.

In the second case, another Catholic elementary school teacher sued under the Age Discrimination in Employment Act, claiming she was demoted, and her teaching contract was not renewed because the school wanted to replace her with a younger teacher. The school said she was let go based on her classroom performance, which was reviewed by the school under religious standards.

The Supreme Court determined the ministerial exception, which was grounded in the First Amendment’s Religion Clauses, barred the teachers’ employment discrimination claims. The Court held that even though the teachers did not have the title of “minister” their cases fell within the same rule that dictated the Court’s decision in Hosanna Tabor v. EEOC

The Court provided that educating students on religion is the main reason for the existence of most private religious schools. Additionally, the selection and supervision of teachers that schools rely on to educate students on religious doctrine is at the core of the schools’ mission. Teachers play a vital role in carrying out the mission of religious schools.

The Court further opined that: “When a school with a religious mission entrusts a teacher with the responsibility of educating and forming students in the faith, judicial intervention into disputes between the school and the teacher threatens the school’s independence in a way that the First Amendment does not allow.”

This ruling has broader implications beyond just Catholic schools. The Supreme Court recognized the First Amendment protects the right of all religious institutions “to decide for themselves, free from state interference, matters of church government as well as those of faith and doctrine.”

Religious organizations are given greater autonomy over their employees and “judges have no warrant to second-guess that judgment or to impose their own credentialing requirements.” What matters in determining whether the ministerial exception applies is “what an employee does.”

The liability of violating Title VII

If ministry leaders are concerned about employment discrimination claims resulting from the recent expansion of Title VII, talk to your agent about whether your ministry has employment practices liability coverage in place.

Additional Resources
Brotherhood Mutual has developed a wealth of free resources, sample policies, and articles addressing employment, belief-based decisions, and religious freedom:

Posted June 29, 2020. Updated July 29, 2020,

The information provided on this page is intended to be helpful, but it does not constitute legal advice and is not a substitute for the advice from a licensed attorney in your area. We strongly encourage you to regularly consult with a local attorney as part of your risk management program.