Do Federal Employment and Discrimination Laws Apply to Churches?

In a decision of extraordinary importance, a federal court has addressed the application of federal civil rights laws to religious organizations. This decision will assist church leaders in evaluating the application of several civil rights laws to church employment practices. These include the Americans with Disabilities Act, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, and the Family Medical Leave Act.

The case addresses not only the meaning of “commerce,” but also the important question of when a church and its affiliated entities (such as a school or preschool) should be treated as “one employer” for purposes of meeting the minimum number of employees required by these laws.

Finally, the court addressed the important question of which employees are counted in meeting the minimum number required by these laws. Because no other court has ever addressed such questions in the context of religious organizations, this decision is of immense importance to church leaders and should be studied carefully.

Are churches, church—operated schools, and other religious organizations subject to the wide array of federal civil rights laws that apply to employers engaged in commerce and having a minimum number of employees? This is a troublesome question that the courts have seldom addressed. The lack of judicial interpretation has increased the confusion over the application of these laws to religious organizations. A federal appeals court has addressed this issue directly in an important ruling. This article reviews the facts of the case, summarizes the court’s decision, and explains the relevance of the case to churches and other religious organizations.

A church school placed an ad in a local newspaper for a part-time music teacher. A woman (the “plaintiff”) with multiple sclerosis, and confined to a wheelchair, called the school in response to the ad. The plaintiff’s recollection of that telephone conversation differs substantially from the school’s account. According to the plaintiff, she spoke with the principal’s secretary, who informed her that the school was in the process of scheduling appointments for interviews.

The secretary asked the plaintiff if she had an educational background in music. When the plaintiff replied that she did, the secretary scheduled an appointment. The plaintiff then asked the secretary if the building was “wheelchair accessible.” At this point the secretary placed the plaintiff on hold for several minutes. When the secretary returned to the phone, she informed the plaintiff that the interview had been canceled.

The plaintiff then suggested that the school “accommodate” her disability by conducting the interview outside. She was again put on hold, and was later informed that the school would not make this accommodation. The plaintiff then asked, “You mean you won’t even make an accommodation for an interview because of my disability?” The secretary responded, “I wouldn’t put it that bluntly” and informed the plaintiff that she should direct further questions to the principal.

The school’s account of the telephone conversation was quite different. It acknowledged that the plaintiff had called about the advertisement, and had asked if the building was wheelchair accessible. The school claimed that the secretary informed the plaintiff that the building was not accessible, but then informed her that the part-time music teacher position had already been filled. The plaintiff then became upset and asked if the position had been filled because she had indicated that she was handicapped. The secretary denied this motive, but the plaintiff remained agitated. The secretary placed the plaintiff on hold to let her “calm down,” and when she picked up the phone again she asked for the plaintiff’s name and phone number so that the principal could call her. The plaintiff did not disclose this information, saying that she would call the principal later.

The plaintiff filed a complaint with the Equal Employment Opportunity Commission (EEOC), which determined that the plaintiff had been a victim of discrimination on account of her disability. The EEOC sued the church and its school, claiming that they both had violated the Americans with Disabilities Act (ADA) as a result of their refusal to “accommodate” the plaintiff’s disability, and their failure to hire her because of her disability.

The church and school argued that they were not covered by the ADA since they were not engaged in “commerce” and had less than 15 employees.

The ADA prohibits employers engaged in an activity “affecting commerce” and having at least 15 employees from discriminating in any employment decision on account of the disabled status of an employee or applicant for employment who is able to perform the essential functions of the job with or without reasonable accommodation by the employer. Note that both conditions are required in order for an employer to be subject to the ADA—it must be engaged in an activity affecting commerce, and it must have at least 15 employees. The court considered these two tests separately.

Were the church and school engaged in an industry affecting commerce? The court noted that the ADA defines this crucial term as “any activity, business, or industry in commerce or in which a labor dispute would hinder or obstruct commerce or the free flow of commerce.”

The church and school insisted that they were not an “industry affecting commerce” under this definition. The court concluded that the school did affect commerce. It relied on an earlier case in which a federal appeals court found that an employer affected commerce since (1) it purchased products and supplies from out of state; (2) its employees traveled out of state on the employer’s business; and (3) its employees made interstate telephone calls. Martin v. United Way, 829 F.2d 445 (3d Cir.1987). The court concluded:

The school and its employees have engaged in activities that affect commerce. The school purchased supplies and books from companies outside of the District of Columbia …. Approximately five of its employees commuted to the school from outside of the District. Employees made interstate telephone calls and mailed letters to locations outside of the District of Columbia.

However, the court cautioned that the plaintiff had not provided any evidence that the church had engaged in activities affecting interstate commerce, and so “this issue is inconclusive.” The court added that “[we] presume that some of the same factors exist with respect to the church.” There is little doubt that the court believed that the church was engaged in commerce.

The ADA does not apply to an employer simply because it engages in activities that affect commerce. The employer also must have a minimum of 15 employees during the current or preceding calendar year. “Current calendar year” is defined as the year in which the alleged discrimination occurred.

The court acknowledged that the school employed fewer than 15 employees. Recognizing this, the plaintiff argued that under the so-called “single employer doctrine” the court should combine the employees of the church and its school and preschool to come up with the required 15 employees.

Under the single employer doctrine, separate entities that represent a “single, integrated enterprise” may be treated as a single employer for purposes of meeting the 15 employee test. The plaintiff asserted that the church operated the school and the preschool, and therefore these three entities should be considered as one.

In deciding whether or not the church, school, and preschool were a “single, integrated enterprise,” the court applied a four-part test announced by the Supreme Court in a 1965 ruling. Radio Union v. Broadcast Services, 380 U.S. 255 (1965). This test focuses on the following four factors: (1) interrelation of operations; (2) common management; (3) centralized control of labor relations; and (4) common ownership or financial control.

The court clarified that “the absence or presence of any single factor is not conclusive,” and that “control over the elements of labor relations is a central concern.” The court cautioned that a plaintiff “must make a substantial showing to warrant a finding of single employer status,” and that there must be sufficient indicia of an interrelationship between the immediate corporate employer and the affiliated corporation to justify the belief on the part of an aggrieved employee that the affiliated corporation is jointly responsible for the acts of the immediate employer.

The court referred to an earlier federal appeals court case finding that the entities must be “highly integrated with respect to ownership and operations” in order for single employer status to be found.

The court’s analysis of each of the four factors is summarized below.

(1) interrelation of operations

The court referred to combined accounting records, bank accounts, lines of credit, payroll preparation, telephone numbers, or offices as examples of “interrelated” operations. However, it concluded that there was insufficient interrelationship between the church, school, and preschool to consider them as a single employer. It did acknowledge that the pastor signed the school’s budget, that a room in the church occasionally was used for school purposes, and that school children ate in a room that was also used by the preschool.

However, the following factors demonstrated that there was insufficient interrelationship among the three entities (church, school, and preschool) to treat them as a single employer: (1) the school had a separate budget; (2) daily operations of the three entities (church, school, and preschool) were independent; (3) hours of operation of the three entities were significantly different (preschool was open earlier and later than the school, and the church alone was open on Saturdays and Sundays); (4) each of the three entities was operated by a different staff; (5) each of the three entities had its own principal or administrator; (6) each entity had different employment contacts and practices; (7) the school was located in a different building from the church and preschool; and (8) while the schoolchildren ate lunch in a room that was also used by the preschool, they did not use the room at the same time.

(2) common management

A second factor to consider in deciding whether or not to treat separate entities as a “single employer” is the presence or absence of common management. The court noted that the “focus of this factor … is on the existence of common directors and officers.” In other words, are the directors and officers of the separate entities the same? The court concluded that this factor was not present in this case: “Here, there are separate management structures for the church, the day care center, and the school. These structures do not continuously monitor one another. The circumstances present here do not warrant a finding of common management.”

The court cautioned that common management will exist when one organization runs another organization “in a direct, hands-on fashion, establishing the operating practices and management practices.”

(3) centralized control of labor operations

A third factor to consider in deciding whether or not to treat separate entities as a “single employer” is the presence or absence of “centralized control of labor operations.” The court observed that “the control required to meet the test of centralized control of labor relations is not potential control, but rather actual and active control of day-to-day labor practices.” This test was not met, the court concluded:

The enterprises here have separate employees, directors, and employment practices. The sole way in which the church is involved with the labor practices of the school is in the final phases of hiring. Plaintiff asserts that the pastor “interviews all applicants for the school,” but plaintiff’s own exhibits contradict this assertion. Rather, the principal and assistant principal screen resumes and conduct interviews; the pastor does not become involved until the end of the process, after the principal and assistant principal have selected two or three finalists, at which point he gives his input. When there is a disagreement, the pastor makes the final decision. The entities have different administrators and distinct labor pools. Plaintiff does not present adequate evidence of day-to-day active control by the church of the school’s labor relations to justify a finding that the entities should be treated as a single employer.

(4) common ownership or financial control

A fourth factor to consider in deciding whether or not to treat separate entities as a “single employer” is the presence or absence of “common ownership or control.” The court noted that “there is common ownership of the property and the buildings in which the day care center, the church, and the school are located, and that the pastor must sign the school’s budget.” On the other hand, the court noted that the church was part of the Archdiocese of Washington “which is the corporate entity that owns the property and the buildings. Further … the Archdiocese has ultimate control over the school’s budget.” The court cautioned that “even if the Archdiocese were a party, common ownership alone is not enough to establish that separate employers are an integrated enterprise.” The court continued:

15 employees

The EEOC appealed the trial court’s dismissal of the lawsuit. A federal appeals court for the District of Columbia reversed the trial court’s dismissal of the case on the ground that there was insufficient evidence to support the trial court’s conclusion that the church, school, and preschool should not be treated as a single employer in applying the 15 employee requirement.

Of most significance to the appeals court was the fact that the record did not reveal whether or not the church, school, and preschool were one corporate legal entity, or three separate entities. The court observed that “we cannot answer a question of utmost importance—whether the school (and the day care center) are distinct legal entities or whether they are merely parts of one legal entity—the church.”

Why was this question so important? Because the Supreme Court’s 4 factor test (discussed above) has only been applied in the context of separate legal entities. In other words, if the church, school, and preschool were a single corporate entity, with the school and preschool operating under the church’s corporate umbrella, then they presumably would be treated as a single employer for purposes of applying the 15 employee requirement. There would be no need to apply the Supreme Court’s 4 factor test.

This test would be applied only if the three entities were legally distinct—that is, they were each separately incorporated. Only then would the 4 factor test be applied to determine whether or not the three entities were sufficiently related to be treated as a single employer for purposes of the 15 employee requirement.

The court conceded that “the door is at least open to apply the test to entities that have different names (a condition satisfied here)—even if they are not legally distinct (a condition that may or may not be satisfied here),” and that “leaving the door open allows the possibility that a single legal entity could … encompass divisions that are sufficiently independent of one another to warrant being treated as distinct employers within the meaning of the employment discrimination statutes.” The court added that “such cases are perhaps rare, but we see no reason to think they are non-existent.”

In summary, the appeals court’s analysis can be reduced to the following points:

Church with no affiliated entities. Consider only the church’s employees in applying the 15 employee test under the Americans with Disabilities Act (or any other federal discrimination law).

Church with one or more affiliated entities that are not separately incorporated. Many churches operate a school, preschool, retirement facility, or other ministry. If these ministries are not separately incorporated, then the church along with its affiliates ordinarily will be treated as a single employer for purposes of applying the 15 employee test under the Americans with Disabilities Act (or any other federal discrimination law). In rare cases, this conclusion may not be automatic. For example, if the affiliates have different names, and are “sufficiently independent,” then single employer status may not be automatic. Rather, the Supreme Court’s 4 factor test (discussed above) may be applied to determine whether or not the church and its affiliates constitute a single employer for purposes of applying the 15 employee test. While such a result will be rare, it is not non-existent.

Church with one or more affiliated entities that are separately incorporated. Many churches operate a school, preschool, retirement facility, or other ministry. If these ministries are separately incorporated, then the Supreme Court’s 4 factor test (discussed above) is applied to determine whether the church along with its affiliates should be treated as a single employer for purposes of applying the 15 employee test under the Americans with Disabilities Act (or any other federal discrimination law).

Religious employers

The appeals court acknowledged that no other court has ever addressed the application of the Supreme Court’s 4 factor test to religious organizations:

Counting employees

The court also addressed the important question of which employees should be counted in determining whether or not the minimum 15 employee test is met. Should part—time employees be counted? Hourly workers? Temporary workers? Persons on vacation or sick leave? These are important questions that must be answered in applying the 15 employee test.

The church, school, and preschool pointed out that in order to be subject to the ADA, an employer must have at least 15 employees “for each working day in each of 20 or more calendar weeks in the current or preceding year.” They noted that the church was open on Saturdays and Sundays, and that a few of its employees worked on those days.

Therefore, if the work week is defined to include Saturdays and Sundays, then they would not have the required number of employees “for each working day” since only a few persons worked on those days. Obviously, many churches have a few employees whose duties require them to work on Saturdays or Sundays.

However, since the number of employees who work on these days usually is minimal, such churches could argue that they are not covered by any civil rights law (federal or state) that applies to employers having a specified number of employees “for each working day in each of 20 or more calendar weeks in the current or preceding year.”

The appeals court referred to a 1997 Supreme Court ruling addressing the question of which employees to count in applying the 15 employee requirement under Title VII of the Civil Rights Act of 1964 (and similar requirements under other federal civil rights laws). Walters v. Metropolitan Educ. Enterprises, Inc., 117 S.Ct. 660 (1997).

The Supreme Court noted that Title VII applies only to an employer “who has fifteen or more employees for each working day in each of twenty or more calendar weeks in the current or preceding calendar year.” During one year an employer had between 15 and 17 employees on its payroll on each working day, but in only nine weeks of the year was it actually compensating 15 or more employees on each working day (including paid leave as compensation). The difference resulted from the fact that the employer had two part-time hourly employees who ordinarily skipped one working day each week.

The Supreme Court applied the so-called “payroll method” for counting employees. Under this approach, an “employee” is any person with whom the employer has an employment relationship during the week in question. The Court explained: “Under the interpretation we adopt … all one needs to know about a given employee for a given year is whether the employee started or ended employment during that year and, if so, when. He is counted as an employee for each working day after arrival and before departure.”

As a result, the Supreme Court’s decision repudiates the argument made by the church, school, and preschool that they did not meet the 15 employee requirement since less than 15 employees were employed on Saturdays and Sundays.

What is the significance of this case to other churches? A decision by a federal appeals court has limited effect. It is binding only in the relevant federal circuit-which in this case is the District of Columbia. Nevertheless, federal appeals court rulings often are given special consideration by courts in other jurisdictions. More importantly, the decision represents one of the few extended discussions of the coverage of religious organizations under federal civil rights laws, and so it may be given special consideration by other courts. For these reasons the case merits serious study by church leaders in every state. With these factors in mind, consider the following:

1. Definition of “commerce.” A number of federal civil rights and employment laws apply to employers that (1) are engaged in interstate commerce, and (2) have a minimum number of employees. These laws include the Americans with Disabilities Act, Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, and the Family Medical Leave Act.

The first question to ask in determining if any of these laws applies to a church is whether or not the church is engaged in commerce. This has been a difficult question to resolve, partly because of the lack of court decisions addressing it. This case is helpful because the court relied on a simple three—part test in deciding that the school was engaged in commerce.

(1) Does the church purchase products and supplies from out of state?

(2) Do church employees travel out of state on church business (including commuting to work)?

(3) Do church employees make interstate telephone calls or send mail out of state?

There are other factors that indicate that a church or other religious organization is engaged in commerce. These include any one or more of the following:

2. 15 employees. Some federal civil rights laws apply only to employers having a minimum number of employees. To illustrate, employers must have 15 or more employees to be subject to the Americans with Disabilities Act and Title VII of the Civil Rights Act of 1964. An employer must have at least 20 employees to be subject to the federal age discrimination law. These laws raise two important questions: (1) which employees are counted, and (2) are a parent organization and its affiliates or subsidiaries treated as a single employer? The court resolved these questions as follows:

Which employees are counted?

The court applied the “payroll method” in counting employees, on the basis of a 1997 Supreme Court decision that adopted this method. Under this method, an “employee” is any person with whom the employer has an employment relationship during the week in question. To illustrate, in determining whether an employer has 15 or more employees “for each working day in each of 20 or more calendar weeks in the current or preceding year,” each week in which an employer has an employment relationship with 15 or more employees is counted. Note that only those persons on the payroll who are employees are counted. Self-employed persons are not considered. Church leaders need to recognize, however, that the definition of “employee” in this context is very broad, and would include most full-time and part-time workers. An example of a self-employed person in this context would be a plumber the church hires for a day or so to make repairs.

Employees of affiliated organizations

Should the employees of an affiliated or subsidiary organization be combined with the employees of a parent organization when counting employees? That is, should the employees of a school, preschool, retirement facility, or other church-affiliated ministry be combined with the employees of the church when counting employees for purposes of applying federal civil rights laws? This is an important question, given the large number of churches that operate affiliated ministries. The court in this case resolved this question as follows:

Unincorporated affiliates. The employees of affiliated ministries that are not separately incorporated ordinarily will be combined with the employees of the parent church for purposes of counting employees under federal civil rights laws. In rare cases, this conclusion may not be automatic. For example, if the affiliates have different names, and are “sufficiently independent,” then single employer status may not be automatic. Rather, the Supreme Court’s 4 factor test (discussed above) may be applied to determine whether or not the church and its affiliates constitute a single employer for purposes of applying the 15 employee test. While such a result will be rare, it is not non-existent.

Separately incorporated affiliates. The Supreme Court’s 4 factor test (discussed above) is applied to determine whether the church along with its affiliates should be treated as a single employer for purposes of counting employees. However, the court in this case cautioned that the 4 factor test may not always be appropriate in the context of religious organizations:

3. Should churches incorporate affiliated ministries? Does this case encourage church leaders to separately incorporate affiliated ministries in order to reduce the likelihood that federal civil rights and employment laws will apply to them? Not necessarily. The only benefit to separate incorporation of affiliated ministries, according to this court, is that the employees of the affiliates are not automatically combined with church employees for purposes of counting employees under federal civil rights and employment laws. The Supreme Court’s 4 factor test is used to determine whether or not the employees of the affiliates are counted.

Note that in some cases the relationship between a church and its affiliates will be sufficiently close under the 4 factor test to combine all employees. Therefore, churches wanting to separately incorporate an affiliated ministry solely to avoid the application of federal civil rights and employment laws should carefully consider the 4 factor test. If this test would be met, even with separate incorporation of the affiliate, then it makes no sense to pursue separate incorporation unless there are other compelling reasons to do so.

Note that there are compelling reasons not to incorporate an affiliated ministry in many cases. Most importantly, by treating the affiliate as a department or integral part of the church, it is much more likely to share in the church’s exemption from property taxes and sales taxes (where applicable) and the church’s preferential zoning classification.

4. Avoidance of EEOC “anti—church” bias. Many church leaders are not concerned about the application of federal civil rights laws, since they are confident that they do not discriminate in employment decisions on the basis of race, color, national origin, gender, age, or disability. However, many view avoidance of federal civil rights laws as desirable, because it can be a very costly, frustrating, and time-consuming ordeal to defend against discrimination cases—even if they are clearly frivolous. Over the past several years, many churches have been charged with violating federal civil rights laws. In a surprising number of these cases, the EEOC itself sues the church. This is a truly extraordinary action that the EEOC reserves for only a few hundred “high profile” cases each year. Churches that are sued by the EEOC are in for a truly negative experience. They often are considered guilty until proven innocent. They are treated with thinly veiled condescension and contempt by government investigators. And, they often are forced to spend thousands of dollars in their own defense since such claims ordinarily are not covered under their general liability insurance policy.

Consider the following example. A Catholic university refused to grant tenure to a nun on the basis of “marginal performance in teaching and scholarly publications.” The nun claimed that the university was guilty of sex discrimination in violation of Title VII of the Civil Rights Act of 1964. The EEOC launched a 2-year “investigation” of the university in an attempt to substantiate the nun’s claim of discrimination. It then sued the university, despite the fact that the university’s actions in denying tenure to a nun in the canon law department was clearly outside of the protection of Title VII. A federal appeals court, in dismissing the EEOC lawsuit, noted that the first amendment’s “nonestablishment of religion” clause, which prohibits “excessive entanglement” between church and state, was violated by the 2-year investigation by the EEOC:

An excessive entanglement may occur where there is a sufficiently intrusive investigation by a government entity into a church’s employment of its clergy …. In this case, the EEOC’s 2-year investigation of [the nun’s] claim, together with the extensive pre-trial inquiries and the trial itself, constituted an impermissible entanglement with judgments that fell within the exclusive province of the Department of Canon Law as a pontifical institution …. This suit and the extended investigation that preceded it has caused a significant diversion of the Department’s time and resources. Moreover, we think it fair to say that the prospect of future investigations and litigation would inevitably affect to some degree the criteria by which future vacancies in the ecclesiastical faculties would be filled. Having once been deposed, interrogated, and haled into court, members of the Department of Canon Law and of the faculty review committees who are responsible for recommending candidates for tenure would do so “with an eye to avoiding litigation or bureaucratic entanglement rather than upon the basis of their own personal and doctrinal assessments of who would best serve the … needs” of the Department. E.E.O.C. v. Catholic University of America, 83 F.3rd 455 (D.C. Cir. 1996).

5. State civil rights and employment laws. Even if you determine, on the basis of this article, that your church is not covered by some or all of the federal civil rights and employment laws summarized in the table at the end of this article, note that many states have enacted their own versions of these laws, and it is possible that these will apply to your church. So, be sure to review your state law to see if there is any comparable law that applies to your church.

6. The Shenandoah Baptist case. In one of the only other court decisions to address the application federal employment laws to employees of a church-operated affiliate, a federal appeals court ruled in 1990 that the federal minimum wage law applied to employees of a church-operated private school. In rejecting the church’s claim that the minimum wage law (the Fair Labor Standards Act) did not apply to a church-operated school, the court noted that the Act was amended in 1966 to specifically cover nonprofit, private schools.

The church claimed that school employees were really church employees and therefore exempt from the Act. It pointed out that the school was “inextricably intertwined” with the church, that the church and school shared a common building and a common payroll account, and that school employees must subscribe to the church’s statement of faith. The court rejected this reasoning without explanation.

The court rejected the church’s claim that its constitutional right of religious freedom would be violated by subjecting its school employees to the minimum wage and “equal pay” provisions of the Act. Any burden on the church’s religious beliefs was limited and outweighed by the government’s compelling interest in ensuring that workers receive the minimum wage. The court observed that school employees whose religious convictions were violated by the school’s coverage under the Act could simply return a portion of their compensation back to the church. Or, they could volunteer their services to the school. Dole v. Shenandoah Baptist Church, 899 F.2d 1389 (4th Cir. 1990).

7. The minister-church relationship. The courts have refused to apply federal civil rights laws to the relationship between a church and its ministers. Therefore, even if a church is engaged in commerce and has the required number of employees for a federal civil rights law to apply, it will not be liable for violating such a law with respect to a minister. To illustrate, a federal appeals court made the following observation in a case involving a dismissed minister’s claim of unlawful discrimination: “This case involves the fundamental question of who will preach from the pulpit of a church, and who will occupy the church parsonage. The bare statement of the question should make obvious the lack of jurisdiction of a civil court. The answer to that question must come from the church.” Minker v. Baltimore Annual Conference of the United Methodist Church, 894 F.2d 1354 (D.C. Cir. 1990). The court acknowledged that the government’s interest in preventing employment discrimination “is compelling,” but it concluded that such an interest “does not override” the protection that the church claims under the constitutional guaranty of religious freedom.

In another case a female sued a religious denomination alleging sex discrimination in violation of Title VII when her application to serve as an “associate in pastoral care” was rejected. In rejecting this lawsuit, the court observed:

[C]ourts must distinguish incidental burdens on free exercise in the service of a compelling state interest from burdens where the “inroad on religious liberty” is too substantial to be permissible …. This case is of the latter sort: introduction of government standards to the selection of spiritual leaders would significantly, and perniciously, rearrange the relationship between church and state. While an unfettered church may create minimal infidelity to the objective of Title VII, it provides maximum protection of the first amendment right to the free exercise of religious beliefs. In other words, in a direct clash of “highest order” interests, the interest in protecting the free exercise of religion embodied in the first amendment to the Constitution prevails over the interest in ending discrimination embodied in Title VII. Rayburn v. General Conference of Seventh Day Adventists, 772 F.2d 1164 (4th Cir. 1985).

In another case a black female sued her religious denomination, claiming both sex and race discrimination when her application for appointment as a member of the clergy was denied. A federal appeals court rejected her claim, noting that “religious bodies may make apparently arbitrary decisions affecting the employment status of their clergy members and be free from civil review having done so.” The court added: “[The minister’s] argument, that Title VII may be applied to decisions by churches affecting the employment of their clergy, is fruitless.” The court concluded: “To accept [the minister’s] position would require us to cast a blind eye to the overwhelming weight of precedent going back over a century in order to limit the scope of the protection granted to religious bodies by the free exercise clause.” Young v. Northern Illinois Conference of the United Methodist Church, 21 F.3d 184 (7th Cir. 1994).

8. Religious exemptions. A number of federal civil rights laws contain limited exemptions for religious organizations. To illustrate, the Americans with Disabilities Act states that religious organizations (including religious educational institutions) are not prohibited “from giving preference in employment to individuals of a particular religion to perform work” connected with the carrying on by the organization of its activities. The ADA further provides that “a religious organization may require that all applicants and employees conform to the religious tenets of such organization.”

Title VII of the Civil Rights Act of 1964 specifies:

This title shall not apply to … a religious corporation, association, educational institution, or society with respect to the employment of individuals of a particular religion to perform work connected with the carrying on by such corporation, association, educational institution, or society of its activities.

This provision permits religious corporations, associations, and educational institutions to discriminate on the basis of religion in the employment of any person for any position. In 1987 the United States Supreme Court ruled unanimously that this exemption did not violate the first amendment’s nonestablishment of religion clause. Corporation of the Presiding Bishop of the Church of Jesus Christ of Latter-Day Saints v. Amos, 483 U.S. 327 (1987). Many state civil rights laws contain limited exemptions for religious organizations.

Explanation: In deciding whether or not the employees of a church-operated school and preschool should be combined with the employees of the church in deciding whether or not the “15 employee” requirement of the Americans with Disabilities Act was met, the court applied a 4 factor test. This test ordinarily is applied only if the church and its affiliates are separate legal entities. If they comprise a single legal entity, they presumably are a single employer for purposes of the 15 employee requirement without the need to apply this test. In rare cases there may be exceptions to this rule.