Employment Practices

Legal Developments

‘Ministerial Exception’ Bars Court from Resolving Youth Minister’s Sex Discrimination Claim

Church Law and Tax Report ‘Ministerial Exception’ Bars Court from Resolving Youth Minister’s Sex Discrimination

Church Law and Tax Report

‘Ministerial Exception’ Bars Court from Resolving Youth Minister’s Sex Discrimination Claim

Key point 8-12.5. Sexual harassment is a form of sex discrimination prohibited by Title VII of the Civil Rights Act of 1964. It consists of both “quid pro quo” harassment and “hostile environment” harassment. Religious organizations that are subject to Title VII are covered by this prohibition. An employer is automatically liable for supervisory employees’ acts of harassment, but a defense is available to claims of hostile environment harassment if they have adopted a written harassment policy and an alleged victim fails to pursue remedies available under the policy. In some cases, an employer may be liable for acts of sexual harassment committed by nonsupervisory employees, and even nonemployees.

Key point 2-04.1. Most courts have concluded that they are barred by the First Amendment guarantees of religious freedom and nonestablishment of religion from resolving challenges by dismissed clergy to the legal validity of their dismissals.

Key point 8-10.1. The civil courts have consistently ruled that the First Amendment prevents the civil courts from applying employment laws to the relationship between a church and a minister.

A federal district court in Nebraska ruled that it was barred by the “ministerial exception” from resolving a youth minister’s claim that his employing church committed unlawful sex discrimination and retaliation by dismissing him. A church’s youth minister (the “plaintiff”) claimed his employment was terminated due to his gender and marital status, and in retaliation for complaining about sexual harassment committed by a pastor who was the plaintiff’s direct supervisor. With regard to his marital status, the plaintiff alleged he filed for divorce during his employment and became the single parent of four children shortly before his termination. Prior to his divorce, the plaintiff alleged he was subjected to “episodes of uninvited touches, body hugs, back rubs and neck massages, private office visits, and unsolicited invitations for drinks, dinner and companionship,” on a daily basis. Based on these allegations, the plaintiff sued his former church asserting claims for gender discrimination and retaliation in violation of Title VII of the Civil Rights Act of 1964.

The church denied the plaintiff’s allegations, claiming that he resigned his employment for personal reasons. It also argued that the plaintiff’s lawsuit was barred by the “ministerial exception” which generally prevents the civil courts from resolving employment disputes between churches and ministers.

The court began its opinion by noting that “since the passage of Title VII … and other employment discrimination laws, the [federal courts] have uniformly recognized the existence of a ‘ministerial exception,’ grounded in the First Amendment, that precludes application of such legislation to claims concerning the employment relationship between a religious institution and its ministers.” In 2012, a unanimous Supreme Court observed:

Requiring a church to accept or retain an unwanted minister, or punishing a church for failing to do so, intrudes upon more than a mere employment decision. Such action interferes with the internal governance of the church, depriving the church of control over the selection of those who will personify its beliefs. Hosanna-Tabor Evangelical Lutheran Church & Sch. v. E.E.O.C., 132 S.Ct. 694 (2012).

The Supreme Court reasoned that forcing retention of an unwanted minister “concerns government interference with an internal church decision that affects the faith and mission of the church itself.”

In order for the ministerial exception to apply, “the employer must be a religious institution and the employee must have been a ministerial employee.” Conlon v. InterVarsity Christian Fellowship, 777 F.3d 829, 834 (6th Cir.2015). The plaintiff conceded that his former church was a religious institution, so the question was whether his employment was ministerial.

Was the plaintiff a “minister”?

In the Hosanna-Tabor case, the Supreme Court provided no “rigid formula for deciding when an employee qualifies as a minister,” but noted that the exception “is not limited to the head of a religious congregation.” It relied on facts such as whether (1) the church held the employee out distinct from other members, (2) the position held a title reflecting specialized training, (3) the employee held himself out as a minister according to the terms of the church, and (4) the job duties reflect a role in conveying the church’s message and carrying out its mission.

In concluding that the plaintiff was a “minister” for purposes of the ministerial exception, the court noted the following facts:

  • he was an ordained minister through a nondenominational agency;
  • he listed his occupation as a minister on his tax forms;
  • he received a bachelor’s degree in Bible and Theology from Moody Bible Institute and studied for a Master’s of Divinity prior to his employment with the defendant church in 2010;
  • he was the church’s “Director of Youth Ministry”;
  • A director in the church was treated differently than a “called” or ordained staff member in some regards.
  • The plaintiff had a role recognized by both himself and the church which was distinct from that of most of the church’s members.

The plaintiff insisted that he was merely a “secular” employee because he was neither ordained clergy in the church’s denomination nor was he engaged in primarily religious activities. He also pointed out that his actual work differed from the duties listed in his job description. For example, his job description stated the Director of Youth Ministry was “responsible for leading and delivering the Wednesday evening student worship service.” However the plaintiff testified, “[W]e never really had a worship service on Wednesday nights.” The plaintiff denied engaging in many of the tasks listed on the formal job description for the Director of Youth Ministry, stating his employment included many informal tasks.

On the other hand, the plaintiff admitted that his employment duties included chaperoning mission trips, teaching eighth grade confirmation class, and teaching Bible school classes. Additionally, he agreed that his actual duties included (a) daily interaction with the youth of the church; (b) ensuring the spiritual needs of the youth of the church were met in a professional and ethical manner; (c) planning, developing, and implementing programs to expand and improve the youth ministry; (d) performing ongoing evaluations of the existing youth program and making changes when necessary; (e) budgeting for the youth program; (f) teaching youth programs in the ways of the church; and (g) recruiting, training, and motivating volunteers from middle school and high school and providing ongoing support for team leaders for the church’s Wednesday evening youth program.

The church’s lead pastor described the plaintiff’s role as “imparting the church’s mission onto the youth by teaching the youth (children in grades 6-12) the Christian Reformed basic tenets of the church—worship, fellowship, discipleship, mission, and evangelism.” The lead pastor described the plaintiff’s job as teaching the Bible, discipleship, the church’s understanding of the Sacraments in the Reformed tradition, and the importance of Holy Scripture in the lives of the youth. Specifically, he described the mission of the church as to know Christ and to make him known, including the “basic instructional discipleship living, how to be a follower of Jesus Christ.” The plaintiff was the leader of the student confirmation process, including planning and leading the worship service culminating in the students’ commissioning into adult membership, and overseeing the development of the entire youth program, including teaching or training staff.

The court concluded that the plaintiff was a “minister” for purposes of the ministerial exception:

The plaintiff’s job duties reflected a role in him conveying the church’s message and carrying out its mission. The church trusted the plaintiff to lead the youth through the tenets of the religion with, at least, weekly confirmation and Bible school classes, with additional instruction in worship, discipleship, fellowship, mission work, and evangelism activities. While the plaintiff may have conducted secular duties, the precise division of secular and religious labor is immaterial particularly when the mission work led by the plaintiff incorporated and embodied the core teachings of the church.

What employment decisions are covered by the ministerial exception?

The court then addressed the question of whether the claims asserted by the plaintiff were covered by the ministerial exception. It concluded:

In this case, the church’s treatment of the plaintiff in relation to his sexual harassment allegation clearly implicates an internal church decision and management, rather than the outward physical acts of one pastor. Accordingly … this court finds the plaintiff’s sexual harassment claim is factually entwined and related to the plaintiff’s other claims, which the court may not review without excessive government entanglement with religion in violation of the First Amendment.

What This Means For Churches:

This case is instructive because of the court’s use of the four-factor analysis enunciated by the Supreme Court in determining if an employee is a “minister” for purposes of the ministerial exception. The court concluded that ordination is not a prerequisite to ministerial status. Rather, a finding of ministerial status involves an examination of the following factors: (1) Did the church hold the employee out distinct from other members? (2) Did the employee have a title reflecting specialized training? (3) Did the employee hold himself out as a minister? (4) Did the employee’s job duties reflect a role in conveying the church’s message and carrying out its mission? In evaluating these factors, the court relied in part on the plaintiff’s job description. The importance of a person’s job description cannot be overstated in evaluating his or her ministerial status, and for this reason it is imperative that job descriptions be carefully crafted. Many churches have employees whose ministerial status is ambiguous, and often this ambiguity can be reduced through careful drafting of a job description.

It is also noteworthy that the court applied the ministerial exception to the plaintiff’s sexual harassment claim because it was “entwined and related” to his claim of wrongful termination. Covenant Presbyterian Church, 2015 WL 1826231 (D. Neb. 2015).

Legal Developments

‘Ministerial Exception’ Bars Court from Resolving InterVarsity Employee’s Sex Discrimination Claim

Church Law and Tax Report ‘Ministerial Exception’ Bars Court from Resolving InterVarsity Employee’s Sex Discrimination

Church Law and Tax Report

‘Ministerial Exception’ Bars Court from Resolving InterVarsity Employee’s Sex Discrimination Claim

Key point 8-10.1. The civil courts have consistently ruled that the First Amendment prevents the civil courts from applying employment laws to the relationship between a church and a minister.

A federal appeals court ruled that it was barred by the “ministerial exception” from resolving a sex discrimination claim by a former employee of a Christian campus ministry. InterVarsity Christian Fellowship/USA (IVCF) is “an evangelical campus mission serving students and faculty on college and university campuses nationwide,” whose vision is “to see students and faculty transformed, campuses renewed and world changers developed.” IVCF’s purpose “is to establish and advance at colleges and universities witnessing communities of students and faculty who follow Jesus as Savior and Lord: growing in love for God, God’s Word, God’s people of every ethnicity and culture and God’s purposes in the world.”

IVCF “believes in the sanctity of marriage and desires that all married employees honor their marriage vows.” It is part of IVCF’s policy that “where there are significant marital issues, IVCF encourages employees to seek appropriate help to move towards reconciliation” and IVCF reserves the right “to consider the impact of any separation/divorce on colleagues, students, faculty, and donors.”

IVCF hires only candidates who agree with its Statement of Agreement: Purpose and Doctrinal Basis.

A woman (the “plaintiff”) began working for IVCF in 1986. In 1988, she married. From 2004 to 2011, the plaintiff was a “Spiritual Formation Specialist” for IVCF staff members, and obtained a certification in Spiritual Direction. Her duties included assisting others to cultivate “intimacy with God and growth in Christ-like character through personal and corporate spiritual disciplines.

In March of 2011, the plaintiff and her husband were considering divorce, and, as required by IVCF policy, she informed her supervisor. Her supervisor placed her on paid leave in an attempt to repair her marriage, as authorized by IVCF policy. The plaintiff claimed her repeated requests to return to work were denied. Her employment was terminated in December of 2011 for “failing to reconcile her marriage.” At that time the plaintiff was still married. She claimed that two or more similarly situated male employees divorced their spouses during their employment, but were not disciplined or terminated. In January 2012, the plaintiff’s husband filed for divorce.

Shortly after her termination, the plaintiff filed a complaint with the Equal Employment Opportunity Commission (EEOC). The EEOC gave her a right-to-sue letter that also informed her that EEOC would not be filing suit. The plaintiff filed suit in a federal district court in Michigan in 2013, alleging sex discrimination in violation of Title VII of the Civil Rights Act of 1964. IVCF filed a motion to dismiss the lawsuit, asserting the ministerial exception as an affirmative defense. The district court granted the motion to dismiss, and the plaintiff appealed to a federal appeals court.

The ministerial exception, which is rooted in the First Amendment’s religion clauses, bars the civil courts from resolving employment disputes between churches and ministers. It was explicitly affirmed by the United States Supreme Court in a 2012 decision, Hosanna-Tabor Evangelical Lutheran Church & School v. EEOC, 132 S.Ct. 694 (2012). In Hosanna-Tabor, the Supreme Court concluded that the ministerial exception prevented it from resolving a claim by a teacher in a church-operated school that her dismissal violated the federal Americans with Disabilities Act. The Court noted that the ministerial exception “precludes application of [employment discrimination laws] to claims concerning the employment relationship between a religious institution and its ministers.”

The appeals court then addressed five issues, including: (1) Did the ministerial exception apply to IVCF? (2) Was the plaintiff a “minister”? (3) Did IVCF “waive” the ministerial exception?

(1) Did the ministerial exception apply to IVCF?

Did the ministerial exception apply to an organization like IVCF that was not a “church”? The court concluded that it did:

It is undisputed that InterVarsity Christian Fellowship is a Christian organization, whose purpose is to advance the understanding and practice of Christianity in colleges and universities. It is therefore a “religious group” under Hosanna-Tabor … . The ministerial exception’s applicability does not turn on its being tied to a specific denominational faith; it applies to multidenominational and nondenominational religious organizations as well … . A religiously affiliated entity is one whose mission is marked by clear or obvious religious characteristics … . That is clearly the case for IVCF, with not only its Christian name, but its mission of Christian ministry and teaching.

(2) Did the ministerial exception apply to the plaintiff?

In Hosanna-Tabor, the Supreme Court addressed a Lutheran church school’s decision to terminate a teacher and “commissioned minister” who the school believed was not able to perform her duties because of a disability. The Court held that the ministerial exception precluded the courts from entertaining claims that the teacher’s employment had been terminated because of her disability or in retaliation for her filing a complaint with the EEOC alleging disability discrimination. Though the Court did not “adopt a rigid formula for deciding when an employee qualifies as a minister,” it identified four factors that led it to conclude that the teacher was a minister covered by the exception: (1) the formal title given to her by the church, (2) the substance reflected in that title, (3) her own use of that title, and (4) the important religious functions she performed for the church.

The appeals court concluded that the plaintiff satisfied the first and fourth factors, but not the second and third, and so “two of the four Hosanna-Tabor factors are clearly present.” The Supreme Court declined to rule upon whether the exception would apply in the absence of one or more of those factors. But the appeals court ruled that “where both factors—formal title and religious function—are present, the ministerial exception clearly applies and so IVCF may assert the ministerial exception regarding the plaintiff’s former position.”

(3) Did IVCF “waive” the ministerial exception?

The plaintiff insisted that the ministerial exception did not preclude her claims because IVCF had “waived” it. She pointed to the following statement on the IVCF website:

InterVarsity Christian Fellowship/USA is both an equal opportunity employer and a faith-based religious organization. We conduct hiring without regard to race, color, ancestry, national origin, citizenship, age, sex, marital status, parental status, membership in any labor organization, political ideology, or disability of an otherwise qualified individual. The status of [IVCF] as an Equal Opportunity Employer does not prevent the organization from hiring staff based on their religious beliefs so that all staff share the same religious commitment.

The website states that all employees must annually reaffirm their agreement with IVCF’s Purpose Statement and Doctrinal Basis. The website further states: “Pursuant to the Civil Rights Act of 1964 [IVCF] has the right to, and does, hire only candidates who agree with its Statement of Agreement: Purpose and Doctrinal Basis.”

The court concluded that IVCF had not “waived” the ministerial exception since “the ministerial exception is a structural limitation imposed on the government by the [First Amendment’s] religion clauses, a limitation that can never be waived.”

The court noted that the Supreme Court’s ruling in Hosanna-Tabor forecloses such waiver, since the Court concluded that “requiring a church to accept or retain an unwanted minister, or punishing a church for failing to do so, intrudes upon more than a mere employment decision. Such action interferes with the internal governance of the church.” The Court’s clear language “recognizes that the Constitution does not permit private parties to waive the First Amendment’s ministerial exception. This constitutional protection is not only a personal one; it is a structural one that categorically prohibits federal and state governments from becoming involved in religious leadership disputes.”

(4) Does the ministerial exception bar discrimination claims against supervisors?

The plaintiff claimed that the ministerial exception did not prevent her from suing her supervisors for sex discrimination since they could not claim the exception. The court disagreed: “They cannot be held liable. Nothing in federal court or Michigan court precedent suggests that [supervisors] cannot claim the ministerial exception when personally sued for discrimination as the agents of a religious employer. Holding the individual decision maker liable for the very employment decision for which the organization cannot be held liable would vitiate both the purpose and the effect of the ministerial exception.”

(5) An affirmative defense

The court cautioned that the ministerial exception is an “affirmative defense” that will be lost if a religious employer fails to assert it in its response to a lawsuit.

The court concluded its opinion by quoting from the Supreme Court’s decision in Hosanna-Tabor:

The interest of society in the enforcement of employment discrimination statutes is undoubtedly important. But so too is the interest of religious groups in choosing who will preach their beliefs, teach their faith, and carry out their mission. When a minister who has been fired sues her church alleging that her termination was discriminatory, the First Amendment has struck the balance for us. The church must be free to choose those who will guide it on its way.

What This Means For Churches:

This case is significant for these reasons:

First, it demonstrates that the ministerial exception is not limited to churches. It applies to any religious employer “whose mission is marked by clear or obvious religious characteristics.” The exception applied to IVCF not only because of “its Christian name, but its mission of Christian ministry and teaching.”

Second, the court referred to the Supreme Court’s four-factor test in deciding if an employee of a religious organization is a “minister” to whom the ministerial exception applies. And, significantly, the court concluded that the plaintiff was a “minister” even though she failed to meet the second and third factors. The court noted that she satisfied the first and fourth factors (her title and functions were clearly religious), and that “where both factors—formal title and religious function—are present, the ministerial exception clearly applies.”

Third, the court concluded that “equal opportunity” language on the IVCF website did not amount to a “waiver” of the ministerial exception, since the exception was based on the First Amendment’s religion clauses which cannot be waived.

Fourth, the court rejected the argument that individual supervisory employees can be sued for violations of state and federal nondiscrimination laws even though a religious employer cannot.

Fifth, the court noted that the ministerial exception is an affirmative defense that must be asserted in a religious employer’s formal answer to a lawsuit or it will be lost. Church leaders should review the answer prepared by their attorney in an employment discrimination case to be certain that the ministerial exception is raised as an affirmative defense. Trial attorneys with little if any experience in representing religious employers may not be familiar with the ministerial exception, or with its status as an affirmative defense that must be pleaded or lost. Conlon v. Intervarsity Christian Fellowship, 777 F.3d 829 (6th Cir. 2015).

Legal Developments

Church School May Have Violated Dismissed Teacher’s Rights under Family and Medical Leave Act

Church Law and Tax Report Church School May Have Violated Dismissed Teacher’s Rights under Family

Church Law and Tax Report

Church School May Have Violated Dismissed Teacher’s Rights under Family and Medical Leave Act

Key point 8-14.1. The federal Americans with Disabilities Act prohibits employers with at least 15 employees, and that are engaged in interstate commerce, from discriminating in any employment decision against a qualified individual with a disability who is able, with or without reasonable accommodation from the employer, to perform the essential functions of the job. Accommodations that impose an undue hardship upon an employer are not required. Religious organizations may give preference to nondisabled members of their faith over disabled persons who are members of a different faith.

Key point 8-15. The federal Family and Medical Leave Act requires employers with 50 or more employees and engaged in interstate commerce to allow employees up to 12 weeks of unpaid leave each year on account of certain medical and family needs. There is no exemption for religious organizations.

Key point 8-20. Several federal and state laws require certain employers to display workplace posters in order to inform employees of their rights. Some poster requirements apply to religious organizations, while others do not. Even those that do often require modification to avoid confusion.

A federal district court in Louisiana ruled that a church school had not violated the Americans with Disabilities Act in dismissing a teacher, but may have violated the Family and Medical Leave Act. A woman (the “plaintiff”) was employed as a teacher at a church school for 14 years. Like all teachers at the school, she was employed on an annual basis pursuant to an employment contract. During the end of the 2011-2012 academic year, she met with the school principal to discuss goals for the upcoming year. One of the plaintiff’s “major goals” was a “health goal” that included seeing a doctor about her weight loss issues (she suffered from anorexia nervosa).

In July 2012, the plaintiff emailed the preschool’s vice principal to inquire about sick leave so she could receive medical attention for her eating disorder. The vice principal informed her that she had 17 sick days plus accrued vacation leave. The Family and Medical Leave Act (FMLA) was not referred to by either the plaintiff or the vice principal. The plaintiff began her sick leave in August of 2012 to seek treatment for her eating disorder.

A few months later, the plaintiff received “return to work” releases and returned to work in October. Her nutritionist “cautiously agreed” to allow her to return to work and noted that the release came with “strict guidelines.” Similarly, the plaintiff’s counselor provided her with a release subject to various conditions.

The day after she returned to work, the plaintiff had an appointment with her nutritionist, who indicated that she was “below expectation” in meeting the required goals for her release to work. During an appointment with her counselor a few days later, the plaintiff was informed that her medical team was discontinuing her treatment because she still continued to lose weight. The plaintiff did not return to work after her appointment, and her employment was terminated.

The plaintiff sued the school claiming that it committed violations of the Americans with Disabilities Act (ADA) and FMLA. The school asked the court to dismiss all claims.

ADA

The plaintiff claimed that the school violated the ADA by terminating her employment before discussing reasonable accommodations and without providing her with sufficient notice of her rights under the ADA.

The court conceded that discrimination under the ADA includes an employer’s failure to make “reasonable accommodations to the known physical or mental limitations of an otherwise qualified individual with a disability unless such covered entity can demonstrate that the accommodation would impose an undue hardship.” An employee’s failure to request accommodation precludes a failure to accommodate claim under the ADA.

The plaintiff admitted that she did not consider herself to be disabled, and so she “has not established that she is a qualified individual with a disability.” Further, the court noted that the plaintiff never asked for an accommodation. Therefore, “because she has shown neither that she is an individual with a disability nor that she requested an accommodation, she has failed to establish a case of failure to accommodate under the ADA.”

The plaintiff also claimed that the school violated her rights under the ADA by failing to post notices explaining her rights under the ADA. The court, in dismissing this argument, concluded: “Federal law requires every employer to post notices describing the provisions of the ADA. These notices are to be posted in ‘conspicuous places.’ There is, however, no private cause of action to enforce the posting requirements.”

FMLA

The FMLA, which applies to employers with 50 or more employees, entitles an eligible employee to take up to 12 work weeks of leave in a 12-month period when the employee has a serious health condition that makes her unable to perform the duties of her position. After a qualifying absence, the employer must restore the employee to the same position previously held by the employee before taking leave under the FMLA.

The plaintiff claimed that the school violated the FMLA by failing to inform her of the amount of leave that she had available and the procedure to apply for available leave. The court stressed that “there are no magic words required of an employee to take leave under the FMLA,” and that the FMLA “does not require an employee to invoke the language of the statute to gain its protection when notifying her employer of her need for leave for a serious health condition.” An employee need only “provide her employer with enough information that would reasonably apprise the employer of the employee’s request to take time off for a serious health condition.” The court concluded:

The school was familiar with the plaintiff’s medical condition and was also aware that discharge from treatment by her medical team would prevent her from working. The court finds these communications sufficient to create a genuine dispute as to a material fact as to whether she provided adequate notice that she was planning to take qualifying leave under the FMLA … . In all circumstances, it is the employer’s responsibility to designate leave, paid or unpaid, as FMLA-qualifying, and to give notice of the designation to the employee … . Once the employer has acquired knowledge that the leave is being taken for an FMLA required reason, the employer must promptly … notify the employee that the paid leave is designated and will be counted as FMLA leave.

The plaintiff asserted that she was unaware of her rights under FMLA since the school had failed to display FMLA posters. But the school principal insisted that there were FMLA notices posted throughout the school. However, she acknowledged that the plaintiff never received individualized notice of her leave time available under the FMLA. As a result, the court denied the school’s motion to dismiss the FMLA claim.

What This Means For Churches:

This case illustrates three important points.

First, the federal Americans with Disabilities Act, which applies to employers with 15 or more employees, imposes upon employers a duty to provide reasonable accommodations to disabled employees, but this requirement does not apply to employees who do not request them.

Second, the failure of an employer subject to the ADA to display posters informing employees of their rights under the Act does not give employees a claim to monetary damages.

Third, here are three points to note about FMLA: (1) It is a federal statute that only applies to employers with 50 or more employees. As a result, it does not apply to most churches. (2) Employees can trigger their rights under the FMLA without referring to the Act. All that is required is that an employee provide an employer with enough information that would “reasonably apprise the employer of the employee’s request to take time off for a serious health condition.” In some cases, the employer may not understand that FMLA leave is being requested. (3) The FMLA requires covered employers to display a poster informing employees of their rights under the Act, but it also requires employers to provide employees with individualized notice of the potential availability of unpaid leave under FMLA. Bernard v. Episcopal Day School, 2014 WL 5342582 (W.D. La. 2014).

Legal Developments

Churches and Revoking Pension

Church Law and Tax Report Churches and Revoking Pension Key point 2-04.1. Most courts have

Church Law and Tax Report

Churches and Revoking Pension

Key point 2-04.1. Most courts have concluded that they are barred by the First Amendment guarantees of religious freedom and nonestablishment of religion from resolving challenges by dismissed clergy to the legal validity of their dismissals.

A federal bankruptcy court in Delaware ruled that it was barred by the “ministerial exception” from resolving a dismissed priest’s claim that his diocese acted unlawfully in revoking his pension benefits based on his sexual abuse of minors. A Catholic diocese filed for bankruptcy protection under Chapter 11 of the bankruptcy code. The diocese had been named as a defendant in 131 child molestation claims involving several priests. The diocese entered into a settlement with the abuse victims in the bankruptcy proceedings. The settlement contained a provision stating that eight priests who had been dismissed by the diocese for abusing minors would be ineligible for benefits of any kind arising on or after the date of the bankruptcy petition, including benefits under the diocese “clergy pension plan.” One of the priests objected to the revocation of his benefits, claiming that this amounted to a breach of contract that could be adjudicated by the court without delving into religious doctrine.

In rejecting the priest’s claim, the court relied on the so-called “ministerial exemption” which generally bars the civil courts from resolving employment disputes between churches and clergy. The court quoted from a 2012 United States Supreme Court ruling that recognized and affirmed the ministerial exemption:

The members of a religious group put their faith in the hands of their ministers. Requiring a church to accept or retain an unwanted minister, or punishing a church for failing to do so, intrudes upon more than a mere employment decision. Such action interferes with the internal governance of the church, depriving the church of control over the selection of those who will personify its beliefs. By imposing an unwanted minister, the state infringes the Free Exercise Clause, which protects a religious group’s right to shape its own faith and mission through its appointments. According the state the power to determine which individuals will minister to the faithful also violates the Establishment Clause, which prohibits government involvement in such ecclesiastical decisions. Hosanna-Tabor Evangelical Lutheran Church and School v. E.E.O.C., 132 S.Ct. 694 (2012).

The Supreme Court concluded that an award of any relief, such as frontpay, backpay, compensatory and punitive damages, or attorney’s fees, would “operate as a penalty on the church for terminating an unwanted minister,” and was prohibited by the First Amendment.

The diocese argued that under the Hosanna-Tabor ruling, the bankruptcy court was barred from granting the priest any relief on account of his removal from ministry. The court agreed.

Hosanna-Tabor has made it clear that the Establishment Clause and the Free Exercise Clause bar the government from interfering with the decision of a religious group to fire one of its ministers. In the same vein, the Court is unable to require a church to “accept or retain an unwanted minister, or punish … a church for failing to do so.” Awarding any relief that would “operate as a penalty on the church for terminating an unwanted minister” is equally prohibited by the First Amendment, seeing as the award of such relief would depend on a determination that the church was wrong to have relieved the minister in question … .

Much like how awarding [the plaintiff] in Hosanna-Tabor with any relief (of frontpay, backpay, compensatory and punitive damages, or attorney’s fees) would operate as a penalty on the church for terminating an unwanted minister, awarding [the priest in this case] with relief for his claim of pension and sustenance would likewise effectively create a penalty or punishment upon the diocese for the removal of the priest from ministerial duties … . The court is barred, by the ministerial exception, from forcing the dismissed priest’s reinstatement into ministry, or awarding any form of relief that would come at the diocese’s expense on account of his removal … .

The ministerial exception exists in order to ensure that “the authority to select and control who will minister to the faithful … is the church’s alone.” The diocese (through the Bishop) chose to remove eight priests from ministry, and that decision remains the diocese’s alone. The granting of any claims for pensions, sustenance, or other forms of relief against the diocese would create a determination that the diocese was wrong to have relieved the ministers of their positions—a decision that the Supreme Court has already declared “strictly ecclesiastical,” and off-limits for the courts.

What This Means For Churches:

This case illustrates how some courts have construed the ministerial exception broadly to apply not only to cases involving termination of clergy, but also to collateral issues. As the Supreme Court noted in the Hosanna-Tabor case, the ministerial exception bars civil courts from awarding damages to dismissed clergy if doing so would have the effect of punishing a church for its decision to terminate a minister. In re Catholic Diocese, 513 B.R. 639 (D. Del. 2014).

Legal Developments

The ADA and Church Hiring

A church may be liable for discriminatory termination, but not for failing to implement reasonable accommodations since it was the plaintiff’s responsibility to suggest accommodations which he failed to do.

Richard R. Hammar, Attorney, CPA
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Key point 8-14.1. The federal Americans with Disabilities Act prohibits employers with at least 15 employees, and that are engaged in interstate commerce, from discriminating in any employment decision against a qualified individual with a disability who is able, with or without reasonable accommodation from the employer, to perform the essential functions of the job. Accommodations that impose an undue hardship upon an employer are not required. Religious organizations may give preference to nondisabled members of their faith over disabled persons who are members of a different faith.

A federal court in Georgia ruled that a church may have violated the Americans with Disabilities Act by dismissing a custodian suffering from schizophrenia, but it could not be liable for failing to reasonably accommodate the custodian's disability since the custodian never suggested reasonable accommodations for the church to try.

A church hired a man (the "plaintiff") as a maintenance worker. He was responsible for cleaning and maintaining the church sanctuary and other areas. He performed his duties well and often was complimented by church members for his good work. He suffered from schizophrenia, a condition characterized by severe anxiety, depression, fear, nightmares, seizures, delusions, hallucinations, difficulty interacting with people, trouble thinking, and insomnia. He controls his symptoms by taking medication and working, but his ability to work is limited to 8 hours per day for 40 hours per week.

The plaintiff further claimed that he was verbally abused by his supervisor when he refused to sign a disciplinary notice regarding offenses and failures he did not commit. The supervisor mentioned plaintiff's mental illness and suggested that he was "off his medications." A few weeks later the plaintiff had a mental breakdown and was hospitalized.In 2012, the church increased his duties to include cleaning the church's classrooms despite knowing his mental limitations. Plaintiff was unable to perform the extra duties to the required standards, which he alleged even people without a mental illness would have been incapable of meeting. He alleged that the church assigned him this work because it knew he would fail and then could use his failure as a pretext to dismiss him due to his disability. In fact, at least three people now perform the job duties plaintiff had been assigned to perform alone.

The church terminated the plaintiff's employment, and he later sued the church for: (1) discriminatory discharge in violation of the Americans with Disabilities Act ("ADA") and a similar state law; (2) failure to make a reasonable accommodation; and (3) intentional infliction of emotional distress. The church asked the court to dismiss all claims.

The court noted that the ADA prohibits an employer from discriminating against "a qualified individual with a disability because of the disability of such individual in regard to job application procedures, the hiring, advancement, or discharge of employees, employee compensation, job training, and other terms, conditions, and privileges of employment." To establish a "prima facie case" of disability discrimination under the ADA, a plaintiff must show that "(1) he is disabled; (2) he was a 'qualified individual' at the relevant time, meaning he could perform the essential functions of the job in question with or without reasonable accommodations; and (3) he was discriminated against because of his disability." Unlawful discrimination also includes the failure to provide "reasonable accommodations" for the disability unless doing so would impose undue hardship on the employer.

The church argued that the plaintiff's ADA claims failed for three reasons: (1) he was not a qualified individual because he was unable to perform his duties to the required standards; (2) he failed to identify a reasonable accommodation that would have enabled him to perform his duties to the required standard; and (3) there was no reasonable accommodation for plaintiff's schizophrenia.

The court noted that the plaintiff was capable of working 8 hours a day for 40 hours per week, and he performed his duties well for a number of years before being terminated. Even though he acknowledged that he was unable to perform the increased amount of work asked of him, he also "alleged facts demonstrating that the church increased his workload to create a pretext for discriminatory discharge. In that regard, he has sufficiently alleged … that he is a qualified individual capable of performing the essential functions of his job without an accommodation." As a result, the court denied the church's request to dismiss the discriminatory discharge claim.

However, the court noted that a plaintiff in an ADA claim "bears the burden of identifying an accommodation, and of demonstrating that the accommodation allows him to perform the job's essential functions." In general, "it is the responsibility of the individual with a disability to inform the employer that an accommodation is needed. Once an individual with a disability has requested provision of a reasonable accommodation, the employer must make a reasonable effort to determine the appropriate accommodation." The plaintiff never requested an accommodation before he was terminated, stating only that "the church made no effort to accommodate [his] mental illness and did not even consider or discuss with him ways to accommodate his mental disability… . Because plaintiff fails to allege that he requested an accommodation, his ADA discrimination claim based on a failure to accommodate is dismissed."

The court also dismissed the plaintiff's disability claim under state law, since the statute's definition of disability excluded schizophrenia.

The plaintiff alleged that the church was liable on the basis of intentional infliction of emotional distress for terminating him as a result of his inability to perform the extra work assigned to him. The court dismissed this claim as well, noting that to establish a claim for intentional infliction of emotional distress, a plaintiff must prove that: "(1) the conduct giving rise to the claim was intentional or reckless; (2) the conduct was extreme and outrageous; (3) the conduct caused emotional distress; and (4) the emotional distress was severe. The defendant's conduct "must be so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community." The court concluded that the church's conduct did not meet this strict standard.

What this means for churches

This case illustrates that an employer may be liable for violating the Americans with Disabilities Act both by terminating an employee because of a disability, and for refusing to assist disabled employees to perform the essential functions of their job by offering reasonable workplace accommodations. The court concluded that the church may be liable for discriminatory termination, but not for failing to implement reasonable accommodations since it was the plaintiff's responsibility to suggest accommodations which he failed to do. Puckett v. Board of Trustees, 2014 WL 1572748 (N.D. Ga. 2014).

Legal Developments

Courts and Non-Minister Employee Disputes

Church Law and Tax Report Courts and non-minister employee disputes Key point 8-10.2. Some courts

Church Law and Tax Report

Courts and non-minister employee disputes

Key point 8-10.2. Some courts have not recognized the ministerial exception, usually because the complainant was not a minister in either status or function, or was employed by a secular organization.

Key point 9-07. The First Amendment allows civil courts to resolve internal church disputes so long as they can do so without interpreting doctrine or polity.

A New Mexico court ruled that the First Amendment did not prevent it from resolving a claim of wrongful termination by a teacher at a church-operated elementary school. An adult female (the “plaintiff”) was employed as a teacher by a church-operated elementary school from 2009 to 2011. She alleged that she was sexually harassed by her supervisor in the summer of 2010. She reported her complaint to church officials, who issued a written reprimand to the supervisor. She claimed that her supervisor later retaliated against her, which ultimately led to the termination of her employment. She further claimed that the school and church breached her employment “contract” by terminating her despite assurances that she would be employed for the following school term. The plaintiff filed a lawsuit, claiming that the school was liable on the basis of breach of contract; and that the supervisor and other school officials were liable on the basis of retaliatory discharge, violation of the state Human Rights Act, intentional interference with contract, and defamation. The plaintiff sought compensatory and punitive damages, interest, attorney fees, and costs.

The defendants asked the court to dismiss all claims on the ground that they were barred by the so-called “church autonomy doctrine” which generally bars the civil courts from intruding into matters of church governance and administration. A trial court agreed with the defendants, and dismissed all claims. The plaintiff appealed, claiming that the church autonomy doctrine does not prohibit breach of contract claims and does not apply to individuals sued in their individual capacity as opposed to churches.

The court began its opinion by noting:

The church autonomy doctrine prohibits civil court review of internal church disputes involving matters of faith, doctrine, church governance, and polity. The doctrine is based on the First Amendment, which states in pertinent part that “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof.” The church autonomy doctrine protects both interests embodied in the First Amendment. First, it prevents civil legal entanglement between government and religious establishments by prohibiting courts from trying to resolve disputes related to ecclesiastical operations. Second, it protects the free exercise of religion by limiting the possibility of civil interference in the workings of religious institutions.

But the court cautioned that the immunity provided by the church autonomy doctrine is not absolute. It does not apply “to purely secular decisions, even when made by churches.” Before a court concludes that the church autonomy doctrin e is implicated:

It first must analyze each element of every claim and determine whether adjudication would require the court to choose between competing religious visions, or cause interference with a church’s administrative prerogatives. The court must next examine the remedies sought by the plaintiff and decide whether enforcement of a judgment would require excessive procedural or substantive interference with church operations. If the answer to either of those inquiries is in the affirmative, then the dispute is truly of a religious nature and the claim is barred from secular court review. If, however, the dispute can be resolved by the application of purely neutral principles of law and without impermissible government intrusion there is no First Amendment shield to litigation.

breach of contract

The plaintiff claimed that the school and church breached her employment contract by dismissing her, despite prior assurances that her contract would be renewed for the following term. The court concluded that a resolution of this claim, against the church and school, would not require the court to interfere with church governance or internal administration:

In her complaint, plaintiff alleges that the church made express and implied promises to her concerning her employment, which she reasonably relied upon in accepting employment. She alleges that the church breached its promises to her, among them the failure to timely notify her of non-renewal and the failure to timely terminate her teaching contract year with just cause. As pled, it appears that she can succeed on her breach of contract claim without any religious intrusion. The trial court does not need to determine whether the church had cause to terminate plaintiff’s employment, but only whether it complied with its contractual obligation with respect to the timeliness of the notice it provided to her.

The second step in the court’s two-step analysis required it to examine the remedy being sought: “In terms of remedy, plaintiff does not seek reinstatement of her teaching position, but seeks only monetary damages. Defendants do not contend that entering a money judgment against the church would require excessive interference with church operations. Thus … plaintiff’s breach of contract claim does not appear to be religious in nature and thus does not implicate First Amendment concerns as a matter of law.”

The court cautioned that “if, at some later stage in the proceedings, it becomes apparent that plaintiff’s breach of contract claim in fact turns on matters of doctrinal interpretation or church governance, then summary judgment in favor of the church may be proper.”

claims against individual defendants

The plaintiff raised a novel argument, claiming that the church autonomy doctrine did not apply to her claims against the individual defendants. Rather, she insisted, it only applies to lawsuits against churches and church schools. The court agreed:

The immunity afforded by the church autonomy doctrine is not triggered simply by the subject matter of the complaint. Instead, the church autonomy doctrine applies only if judicial resolution of the claims would violate the First Amendment. This is a fact-specific and claim-specific inquiry, an inquiry that the district court did not engage in here. We are not persuaded that the resolution of plaintiff’s claims against [her supervisor and church officials] will necessarily result in religious entanglement. We thus conclude that the trial court erred in dismissing them as a matter of law.

The court again conceded that “if it appears at a later stage of this case that plaintiff’s claims against [the individual defendants] cannot be resolved without religious entanglement, then those claims may properly be dismissed.”

What This Means For Churches:

This case is instructive for a couple of reasons. First, it demonstrates that employers may violate state and federal employment discrimination laws by “retaliating” against employees because they complained about discrimination on the job. Church leaders should never terminate, demote, or take any other action against an employee that may be perceived as “retaliation” for making a claim of unlawful discrimination without first consulting with legal counsel.

Second, the court concluded that the church autonomy doctrine does not insulate the “secular decisions” of churches and church schools from legal scrutiny. However, the court made clear that if any time while a lawsuit is pending it becomes clear that any resolution of the lawsuit would implicate a court in matters of faith or doctrine, then the case must be dismissed.

Third, the court reached the novel conclusion that the church autonomy doctrine does not necessarily apply to individuals, even if employed by a church. 331 P.3d 997 (N.M. App. 2014).

Legal Developments

Seminary Professor Unable to Sue for Racial Discrimination

Ministerial exemption keeps court from getting involved in discrimination claims.

Church Law and Tax Report

Seminary Professor Unable to Sue for Racial Discrimination

Ministerial exemption keeps court from getting involved in discrimination claims.

Key point 2-04.1. Most courts have concluded that they are barred by the First Amendment guarantees of religious freedom and nonestablishment of religion from resolving challenges by dismissed clergy to the legal validity of their dismissals.

Key point 8-10.1. The civil courts have consistently ruled that the First Amendment prevents the civil courts from applying employment laws to the relationship between a church and a minister.

The Kentucky Supreme Court ruled that the “ministerial exception,” which bars the civil courts from resolving employment discrimination claims between churches and clergy, prevented a seminary professor from suing his seminary for racial discrimination, but did not prevent him from suing the seminary for breach of contract. Founded in 1865, originally as the College of the Bible on the campus of Transylvania University, Lexington Theological Seminary is “an accredited graduate theological institution of the Christian Church (Disciples of Christ).” The stated mission of the Seminary is “to prepare faithful leaders for the church of Jesus Christ and, thus, to strengthen the church’s participation in God’s mission for the world.” In executing its mission, the aim of the Seminary is “to prepare women and men of varied backgrounds and traditions for ordained and other forms of ministry.” Consistent with this mission and the tenets of the Christian Church (Disciples of Christ), the Seminary is intentionally ecumenical with nearly half of its enrollment coming from other Christian denominations.

The Seminary’s Faculty Handbook detailed the procedure for termination of tenured faculty. Proceedings to dismiss a tenured professor could only be instituted by the president, the dean, or a member of the faculty. “The only grounds for dismissal of a tenured faculty member are moral delinquency, unambiguous failure to perform the responsibilities outlined in this Handbook, or conduct detrimental to the Seminary.” Employed on an annual probationary basis, non-tenured faculty members may only be dismissed for cause, as well.

The Seminary began experiencing severe financial problems in 2009 amidst a nationwide economic downturn. During the period of July 2007 to January 2009, the Seminary saw its endowment shrink from roughly $25 million to $16 million. At that time, the Seminary had 10 full-time professors, 21 other full-time staff members, and a number of part-time instructors. To survive this “tsunami of economic disasters,” the Seminary decided to abolish a number of faculty and staff positions. The Board of Trustees approved eliminating tenured faculty. One of these was a tenured professor (the “plaintiff”) who had taught at the seminary for 15 years. Before terminating his employment, the Seminary offered him a severance package which offered an additional year’s employment with a year’s salary, conditioned upon the release of all potential claims against the Seminary. The plaintiff declined the offer. The Seminary restructured its curriculum and mission in an attempt to weather the financial chaos, opting to “emphasize practical training for clergy in areas such as financial management, conflict resolution and the use of technology … rather than … theology and biblical studies.”

Following his termination in 2009, the plaintiff sued the Seminary for breach of contract, breach of the implied duty of good faith and fair dealing, and discrimination based on race. The trial court dismissed all claims on the ground that they were barred by the “ministerial exception.” A state appeals court agreed, and the plaintiff appealed to the state supreme court.

The ministerial exception
The court began its ruling by affirming the ministerial exception: “Simply stated, the ministerial exception is a judicially created principle whereby the secular courts have no competence to review the employment-related claims of ministers against their employing faith communities.” The court noted that the ministerial exception has been applied to lay employees, seminary professors, hospital workers, press secretaries, musicians, and many others. It further noted that the United States Supreme Court, in a case unanimously affirming the ministerial exception in 2012, declined “to adopt a rigid formula for deciding when an employee qualifies as a minister.” Hosanna-Tabor Evangelical Lutheran Church and School v. E.E.O.C., 132 S.Ct. 694 (2012). The Court concluded that a called teacher in a Lutheran school was a minister under the ministerial exception in light of “the formal title given her 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.”

The plaintiff was a ministerial employee to whom the ministerial exception applied
In deciding whether the plaintiff was a ministerial employee, the court applied the four-factor test applied by the United States Supreme Court in the Hosanna-Tabor case:

1. the formal title given by the religious institution,
2. the substance reflected in that title,
3. her own use of the title, and
4. the important religious functions performed for the religious institution.

The court declined to “adopt a categorical rule regarding Seminary professors or any other class of individuals who may be considered ministers under the ministerial exception.” But, it concluded that the plaintiff was a minister: “[The plaintiff] is not ordained … but that is not dispositive. Given his extensive involvement in the Seminary’s mission, religious ceremonies, and the subject matter of his teaching, it is clear that he is a ministerial employee.” The court pointed to the following facts:

  • As a member of the faculty, the plaintiff was tasked with carrying out the mission of the Seminary to prepare students for the ministry of Jesus Christ.
  • The plaintiff’s teaching focused on “helping students understand what the basic socio-ethical issues are and the nature of the Christian (or Christ-like) response.” Some of the courses he taught included “Introduction to Christian Social Ethics,” “The Church and the Urban Poor,” “The Cultural Context of Ministry,” and “The Black Religious Experience in America.”
  • During his employment at the Seminary, the plaintiff participated in chapel services, convocations, faculty retreats, and other religious events. He preached on numerous occasions at both his own CME congregation and various Christian Church (Disciples of Christ) congregations.

The court concluded that the plaintiff “was closely connected to the tenets of the faith espoused by the Seminary and actively involved in the promotion of the Seminary’s mission. As a professor at an ecumenical Seminary, instructing on Christian principles, he served as a representative of the Seminary’s message. He has, on multiple occasions, served as the Seminary’s official representative, ambassador, and voice to the faithful.”

Discrimination claim
The court concluded that the ministerial exception barred the plaintiff’s race discrimination claim: “In Hosanna-Tabor, the Supreme Court made clear that the ministerial exception bars employment discrimination suits. And, in addition, the pre-Hosanna-Tabor case law regarding the interplay between anti-discrimination statutes and the ministerial exception is clear: these claims are barred. As a result, the plaintiff’s claim [of race discrimination] ends with the determination that he is a ministerial employee.”

The court observed, “Employment discrimination laws require employers to meet certain fairness standards in hiring and firing employees. Enforcing these laws on religious institutions, possibly against the religious institution’s sincerely held beliefs, goes to the core of the purpose behind the ministerial exception because the government would deprive the church of control over the selection of those who will personify its beliefs. A religious institution may hold beliefs that are discriminatory under a particular anti-discrimination statute and the ministerial exception acts to protect the religious freedom of those institutions no matter how distasteful society may find it or how strong the societal interest may be.”

Breach of contract claim
The court ruled that the plaintiff could pursue his breach of contract claim against the Seminary since: “(1) the enforcement of the contractual arrangement between the Seminary and the plaintiff does not arouse concerns of government interference in the selection of ministers, and (2) the contract does not involve any matters of ecclesiastical concern that would otherwise bar the suit under the ecclesiastical abstention doctrine.”

The court noted that “when deciding whether a claim is barred by the ministerial exception, it is important to remain mindful of the ministerial exception’s underlying purpose: to allow religious institutions, free from government interference, to exercise freely their right to select who will present their faith tenets. Although state contract law does involve the governmental enforcement of restrictions on a religious institution’s right or ability to select its ministers, those restrictions are not governmental restrictions. Simply put, the restrictions do not arise out of government involvement but, rather, from the parties to the contract, namely, the religious institution and its employee.”

The court stressed that “we are not presented with a situation where the government is inappropriately meddling in the selection of who will minister to the congregation. Limits on a religious institution’s ability to choose—or the criteria for choosing—who will minister to its faithful are not being foisted on the religious institution. The government had no role in setting the limits on how the Seminary’s tenured professors may be terminated. Instead, this is a situation in which a religious institution has voluntarily circumscribed its own conduct, arguably in the form of a contractual agreement, and now that agreement, if found to exist, may be enforced according to its own terms. That cannot breach church autonomy. Arguably, instead, this exemplifies religious autonomy because religious institutions are free to set forth policies that align with their respective mission.”

The court concluded:

The Seminary “willingly made a decision to offer tenure—a wholly secular concept—in exchange for professorial services. Providing substance to the offer of tenure, the Seminary explicitly stated in writing that it would only terminate a tenured professor on three grounds: (1) “moral delinquency,” (2) “unambiguous failure to perform the responsibilities outlined in [the Faculty] Handbook,” and (3) “conduct detrimental to the Seminary.” Of course, under the First Amendment, and the ministerial exception for that matter, the Seminary enjoys the right to excuse ministers as it sees fit. But here, the Seminary circumscribed its right to excuse faculty, ministers or not. The Seminary agreed to only express its First Amendment right under limited conditions.”

While the court permitted the plaintiff to pursue his breach of contract claim, it stressed that “reinstatement is an unavailable remedy because that would entail a secular court deciding who speaks for the church. That we cannot do.”

What This Means For Churches:

This case is relevant for two reasons. First, the court applied a four-factor test, first announced by the United States Supreme Court in the Hosanna-Tabor case, in determining if a person is a “minister” to whom the ministerial exception applies.

Second, the court concluded that while the ministerial exception bars discrimination claims by current or dismissed ministers, it does not bar breach of contract claims. The court concluded that the provisions of the Seminary’s Faculty Handbook pertaining to tenured positions was a “contract” between the plaintiff and Seminary, and the Seminary could be liable on the basis of breach of contract for violating its provisions. This, the court concluded, was not a matter of a civil court meddling in employment decisions between a Seminary and its faculty. Instead, it was simply a civil court enforcing the agreement privately entered into between the Seminary and plaintiff.

Not all courts will agree that breach of contract claims between churches and clergy are not barred by the ministerial exception. But, this possibility will exist in some states, which makes it imperative for church leaders to obtain legal review of employment handbooks and other contractual documents to ensure that they will not give rise to breach of contract claims that the civil courts may agree to adjudicate. Through careful drafting, this risk can be significantly reduced, if not eliminated. Kirby v. Lexington Theological Seminary, 426 S.W.3d 597 (Ky. 2014).

Legal Developments

Ministerial Exemption Prevents Court from Resolving Lawsuit

Texas court claims they’re unable to resolve wrongful dismissal claim.

Church Law and Tax Report

Ministerial Exemption Prevents Court from Resolving Lawsuit

Texas court claims they’re unable to resolve wrongful dismissal claim.

Key point 2-04.1. Most courts have concluded that they are barred by the First Amendment guarantees of religious freedom and nonestablishment of religion from resolving challenges by dismissed clergy to the legal validity of their dismissals.

A Texas court ruled that the so-called “ministerial exception” prevented it from resolving a dismissed pastor’s lawsuit claiming that he had been wrongfully dismissed by his church. In 2009, a pastor entered into an employment agreement with a church. The agreement provided that the pastor would serve as pastor of the church for a five-year period with the possibility of two additional five-year terms. In 2011 the church terminated the pastor’s employment.

The pastor sued the church, and both state and national denominational agencies (the “church defendants”) for breach of contract and infliction of emotional distress. He sought damages for loss of future and past wages, punitive damages, and attorney’s fees. The trial court dismissed the pastor’s lawsuit on the basis of the “ministerial exception” which holds that the First Amendment guaranty of religious freedom prohibits the civil courts from resolving employment disputes between churches and clergy.

A state appeals court affirmed the trial court’s dismissal of the case. The court noted that the First Amendment’s guaranty of religious freedom “precludes, among other things, government action that burdens the free exercise of religion by encroaching on the church’s ability to manage its internal affairs.” To enforce this constitutional provision, “the courts have utilized the ecclesiastical abstention doctrine and the ministerial exception.” The ecclesiastical abstention doctrine “prohibits civil courts from exercising jurisdiction over matters concerning theological controversy, church discipline, ecclesiastical government, or the conformity of the members of the church to the standard of morals required of them.” The ministerial exception “provides that civil courts lack subject matter jurisdiction to decide cases concerning employment decisions by religious institutions concerning a member of the clergy or an employee in a ministerial position.” The court noted that the United States Supreme Court unanimously affirmed the ministerial exception in 2012. Hosanna-Tabor Evangelical Lutheran Church and School v. E.E.O.C., 132 S.Ct. 694 (2012).

The court concluded: “The pastor claims that the church harmed him by terminating his employment. To determine the efficacy of his claims, the courts would have to decide whether the termination of his employment was wrongful or premature. The free exercise clause of the Constitution prohibits the courts from reviewing employment decisions regarding ministers.” The court quoted from the Supreme Court’s decision in the Hosanna-Tabor case:

Requiring a church to accept or retain an unwanted minister, or punishing a church for failing to do so, intrudes upon more than a mere employment decision. Such action interferes with the internal governance of the church, depriving the church of control over the selection of those who will personify its beliefs. By imposing an unwanted minister, the state infringes the Free Exercise Clause, which protects a religious group’s right to shape its own faith and mission through its appointments. According the state the power to determine which individuals will minister to the faithful also violates the Establishment Clause, which prohibits government involvement in such ecclesiastical decisions.

The court noted that if it were to second guess the church’s decision to terminate the pastor it would “deprive the church of its right to shape its own faith and mission by imposing an unwanted minister … . Further, any monetary award by the court would operate as a penalty on the church for terminating an unwanted minister. Clearly, failure to extend Hosanna-Tabor to the present case would result in the untenable consequence of the court establishing religion and preventing the free exercise thereof in violation of the First Amendment.”

What This Means For Churches:

This case illustrates the unwillingness of the civil courts to review decisions by churches to terminate ministers. It also demonstrates that this unwillingness extends not only to wrongful termination claims, but also related claims including defamation and emotional distress. Reese v. General Assembly of Faith Cumberland Presbyterian Church in America, 425 S.W.3d 625 (Tex. Ap. 2014).

Legal Developments

Ministerial Exception Prevents Courts from Making Defamation Charges

Pastor accused by church leaders of producing pornography is unable to claim defamation in the courts

Church Law and Tax Report

Ministerial Exception Prevents Courts from Making Defamation Charges

Pastor accused by church leaders of producing pornography is unable to claim defamation in the courts

Defamation

Key point 8-10.1. The civil courts have consistently ruled that the First Amendment prevents the civil courts from applying employment laws to the relationship between a church and a minister.

Key point 10-15. The First Amendment limits, but does not eliminate, a church’s liability for defamation.

A Texas court ruled that the “ministerial exception,” which bars civil courts from resolving employment disputes between churches and pastors, prevented it from resolving an associate pastor’s claim that he had been defamed by church leaders who accused him of producing and accessing pornography. A church’s associate pastor (the “plaintiff”) alleged that church officials sought his resignation because he revealed to them that the church had financial problems. In particular, he claimed that he informed church officials “that the church’s financial condition was deteriorating and that they might have to hold a membership meeting of the church to discuss the financial options available.” The plaintiff claimed that the lead pastor did not like this financial news because it “reflected on his ability to run the church and it prevented him from making an overseas trip using church funds.” According to the plaintiff, the lead pastor “began a campaign to solicit negative comments in the form of letters from various members to be used as a reason to embarrass him into resigning from his position.”

The plaintiff asserted that church leaders “falsely accused him of producing and disseminating pornography.” The allegedly false accusations were based on an e-mail that the plaintiff sent to the lead pastor in which he attached a proposed announcement to be made during an upcoming church service that depicted a couple lying in bed with the caption “Ignite Your Marriage at [our church]. Mattress not included.” The plaintiff insisted that the couple depicted in the image were fully clothed, and therefore the accusation of pornography was false and defamatory.

The plaintiff sued the lead pastor, and church for defamation, conspiracy, interference with contract and prospective contract, negligence, and intentional infliction of emotional distress. He asked for injunctive relief and monetary damages. The trial court dismissed the lawsuit, and the plaintiff appealed.

A state appeals court began its opinion by noting that “the ecclesiastical abstention doctrine prevents secular courts from reviewing many types of disputes that would require an analysis of theological controversy, church discipline, ecclesiastical government, or the conformity of the members of the church to the standard of morals required.” The doctrine provides that “civil courts are to accept as final, and as binding on them the decisions of an ecclesiastical institution on such matters.”

The related “ministerial exception” refers to the application of the ecclesiastical abstention doctrine in the employment context. It provides that “civil courts lack subject matter jurisdiction to decide cases concerning employment decisions by religious institutions concerning a member of the clergy or an employee in a ministerial position … . Although wrongs may exist in the ecclesiastical setting, and although the administration of the church may be inadequate to provide a remedy, the preservation of the free exercise of religion is deemed so important a principle that it overshadows the inequities that may result from its application.”

The court concluded that the ecclesiastical abstention doctrine and ministerial exception required the dismissal of the plaintiff’s claims against the lead pastor and church:

Each of his causes of action are based on [the church defendants] allegedly taking action against him for conduct that they viewed as inappropriate for an associate pastor. There was no evidence adduced that his reputation was harmed outside of the church community, nor was there evidence that the church defendants took any action outside the context of their deliberations regarding the plaintiff’s fitness for service as an associate pastor with the church. Instead, the evidence demonstrated that “the individual defendants did not publish the alleged defamatory statements to third parties outside of the church membership” and that “the substance and nature of his claims is to recover for an intangible injury to his reputation and for emotional distress allegedly caused by the church defendants’ statements and actions in connection with the employment dispute.” The evidence established that the actions underlying the plaintiff’s claims—specifically, the lead pastor’s assertions that the plaintiff distributed pornography—took place entirely within the context of church officials’ internal efforts to remove him from his position. Thus, trial on the plaintiff’s claims would require an analysis of “church discipline, ecclesiastical government, or the conformity of the members of the church to the standard of morals required.” The ecclesiastical abstention doctrine precludes subject matter jurisdiction over those causes of action.

What This Means For Churches:

This case demonstrates the important principle that the ministerial exception not only bars civil court review of wrongful dismissal claims by clergy, but also any claims collateral to adverse employment decisions including defamation, conspiracy, and emotional distress.

The case is also important because the court concluded that the ministerial exception required dismissal of the plaintiff’s interference with contract claim. Such a claim arises when one party shares information with an employer that leads to the termination of an employee. This basis of liability is sometimes asserted against churches and denominational agencies that share negative information about a minister that leads to the termination of his or her employment by another church. The plaintiff insisted that his interference with a prospective contract claim was based on an allegation that “he was removed from consideration for a job at another church” based on the false charge of using pornography. In rejecting this basis of liabliity, the court observed that “this allegation is also based on acts allegedly taken within the context of the church’s internal employment procedures. It is barred by the ministerial exception.” 399 S.W.3d 690 (Tex. App. 2013).

Legal Developments

Ministerial Exemption Bars Court’s Ruling in Music Director’s Dismissal

Federal Court unable to resolve claim that director’s dismissal was based on age or disability.

Richard R. Hammar, Attorney, CPA
Bio

Church Law and Tax Report

Ministerial Exemption Bars Court’s Ruling in Music Director’s Dismissal

Federal Court unable to resolve claim that director’s dismissal was based on age or disability.

Richard R. Hammar

Key point 8-10.1. The civil courts have consistently ruled that the First Amendment prevents the civil courts from applying employment laws to the relationship between a church and a minister.

A federal appeals court ruled that it was barred by the “ministerial exception” from resolving a church music director’s claim that he was dismissed in violation of federal laws prohibiting employment discrimination based on age or disability. A church’s music director (the “plaintiff”) oversaw the music department’s budget and expenditures, managed the sound systems and maintained the sound equipment, music room, and music area in the sanctuary, and rehearsed with members of the choir and accompanied them on the piano during services while running the soundboard. The plaintiff’s employment was terminated by the church, and he filed a lawsuit claiming that his termination was in violation of the Age Discrimination in Employment Act and the Americans with Disabilities Act. The church asked the court to dismiss the lawsuit on the basis of the ministerial exception, which generally bars the civil courts from resolving employment disputes between churches and clergy. A federal district court agreed that the ministerial exception applied, and it dismissed the case.

A federal appeals court affirmed the dismissal of the plaintiff’s claims. It relied on a 2012 ruling by the United States Supreme Court unanimously affirming the ministerial exception. Hosanna-Tabor Evangelical Lutheran Church and School v. E.E.O.C., 132 S.Ct. 694 (2012). In the Hosanna-Tabor case, the Supreme Court ruled that “there is a ministerial exception” that “bars the government from interfering with the decision of a religious group to fire one of its ministers.”

The Starkman Test

In Hosanna-Tabor, the Supreme Court specifically declined to adopt a “rigid formula” for determining when an employee is a minister within the meaning of the ministerial exception, concluding instead that “all the circumstances of employment” must be considered.

In 1999, a federal appeals courtadopted a three-part test for deciding if a church employee was a minister for purposes of the ministerial exception. Starkman v. Evans, 198 F.3d 173 (5th Cir. 1999):

First, this court must consider whether employment decisions regarding the position at issue are made largely on religious criteria … . Second, to constitute a minister for purposes of the “ministerial exception,” the court must consider whether the plaintiff was qualified and authorized to perform the ceremonies of the Church … . Third, and probably most important, is whether [the employee] engaged in activities traditionally considered ecclesiastical or religious, including whether the plaintiff attends to the religious needs of the faithful.

This three-part test became known as the “Starkman test” for determining ministerial status, and it was applied by several other courts. The court in the church music director’s case concluded that this test was no longer viable in light of the Hosanna-Tabor case:

Reviewing the arguments advanced by the parties … we conclude that the Supreme Court’s decision in Hosanna-Tabor at most invalidates and at least modifies Starkman‘s three-part test … . The Hosanna-Tabor Court engaged in a fact-intensive inquiry and explicitly rejected the adoption of a “rigid formula” or bright-line test. In light of this, Starkman‘s three-part test cannot survive in its precise form. First, given the totality-of-the-circumstances analysis in which the Hosanna-Tabor Court engaged, limiting the inquiry in ministerial exception cases to a three-part test is invalid … . Some of the facts the Hosanna-Tabor Court underscored may not be able to be considered under Starkman‘s three prongs, which would not be permissible. Second, because the Supreme Court eschewed a “rigid formula” in favor of an all-things-considered approach, courts may not emphasize any one factor at the expense of other factors. Thus, Starkman‘s “most important” factor—whether the plaintiff “engaged in activities traditionally considered ecclesiastical or religious”—may no longer serve as the gravamen of a ministerial exception case. However, this is not to place too great an emphasis on Hosanna-Tabor. Any attempt to calcify the particular considerations that motivated the Court in Hosanna-Tabor into a “rigid formula” would not be appropriate.

We are mindful of the benefit that clear standards provide to lower courts and religious employers seeking to structure their actions in accordance with the law. However, Hosanna-Tabor‘s rejection of a bright-line test likely reflects the diversity of religious practice in this country; given the pluralism of religious thought for which America is known and celebrated, it may not be possible to develop a one-size-fits-all approach to the ministerial exception … . Following the example of the Hosanna-Tabor Court, it is enough for us to conclude that, under the circumstances [the plaintiff] falls within the ministerial exception.

The Plaintiff’s Ministry

The crux of the plaintiff’s argument was that he merely played the piano during church services and that his only responsibilities were keeping the books, running the sound system, and doing custodial work, none of which was religious in nature. However, the court noted that “the performance of secular duties may not be overemphasized in the context of the ministerial exception.”

“The Hosanna-Tabor Court engaged in a fact-intensive inquiry and explicitly rejected the adoption of a ‘rigid formula’ or bright-line test. In light of this, Starkman’s three-part test cannot survive in its precise form.”

The church focused on the important role music plays in worship. It introduced evidence that all musicians, regardless of whether they are professional or volunteer or work full- or part-time, “exercise a genuine liturgical ministry.” An expert on canon law testified:

The church believes that music in the liturgy is sacred and has ritual and spiritual dimensions. Music enhances the prayer that occurs in the Catholic Mass by enriching its elements. It also draws the congregation closer to Christ, and allows the congregation to act together in celebration by singing praises and hymns to the Lord, which in turn strengthens the faith that is in them. Music is a part of the celebration and prayer that is occurring at the Mass and enhances the liturgy.

The court concluded that the plaintiff was a “minister” for purposes of the ministerial exception since playing the piano during worship “furthered the mission of the church and helped convey its message to the congregants.”

The plaintiff also insisted that he could not be considered a minister since he was not ordained and he did not conduct Mass, deliver a sermon, or write the music or lyrics for the ceremony, and lacked the education, training, and experience to be considered a minister. The court rejected this reasoning:

[The plaintiff’s] lack of formal training in Catholic doctrine is immaterial; this is because the ministerial exception does not apply only to those who are ordained. Moreover, the church introduced evidence, prepared by the United States Conference of Catholic Bishops and intended to aid in the preparation and celebration of the liturgy, that “as a matter of both religious belief and canon law, the Church considers music in the liturgy to be sacred, with ritual and spiritual dimensions; and a church musician to be a minister who shares faith, serves the community, and expresses the love of God and neighbor through music.” For Appellees, the argument is simple: Mass is the center of the Catholic faith, and the plaintiff was at the center of Mass.

The court noted that the Supreme Court in Hosanna-Tabor observed that “the heads of congregations themselves often have a mix of duties, including secular ones, such as helping to manage the congregation’s finances, supervising purely secular personnel, and overseeing the upkeep of facilities.” Accordingly, “that the plaintiff lacked the religious training present in Hosanna-Tabor is insufficient to insulate him from the application of the ministerial exception, particularly in light of the important part his ostensibly secular duties—working on the music department budget, managing the sound system, running the soundboard during Mass, maintaining the music room, rehearsing with choir members and cantors, and playing piano during services—played in furthering the mission and message of the church at Mass.”

What This Means For Churches:

This case is important for two reasons. First, the court rejected the three-part Starkman test for determining ministerial status in applying the ministerial exception, noting that it could not survive the “facts and circumstances” approach articulated by the Supreme Court in Hosanna-Tabor. Second, the court emphasized the significance of music in the ministry of a church, and therefore those who are integrally involved in music ministry should be deemed “ministers” covered by the ministerial exception. Cannata v. Catholic Diocese, 700 F.3d 169 (5th Cir. 2012).

Legal Developments

Ministerial Exception Prevents Court from Resolving Employment Dispute

Key point 8-10.1. The civil courts have consistently ruled that the First Amendment prevents the

Richard R. Hammar, Attorney, CPA
Bio

Key point 8-10.1. The civil courts have consistently ruled that the First Amendment prevents the civil courts from applying employment laws to the relationship between a church and a minister.

The Wisconsin Supreme Court ruled that it was barred by the "ministerial exception" from resolving an employment dispute between a church and its Director of Faith Formation. A church entered into a written, one-year employment contract with a woman (the "plaintiff") who served as its Director of Faith Formation. The contract described the plaintiff's duties, the annual salary and fringe benefits to which she would be entitled, the term of the contract, the facilities to which she would have access as Director of Faith Formation, and the procedures for employee evaluation and annual contract renewal. Additionally, the contract included provisions governing termination of the employment relationship. The contract provided:

The PARISH agrees that the DIRECTOR OF FAITH FORMATION shall not be discharged during the term of this contract, without good and sufficient cause, which shall be determined by the PARISH. The PARISH agrees that the Pastor of the PARISH will be responsible for giving the employee notice of any dissatisfaction with service or conduct. Dismissal may be immediate or within a time frame determined by the PARISH.

The church terminated the plaintiff's employment. It was undisputed that the plaintiff had been compensated for all services performed under the contract, and that she was a "ministerial employee" whose work was fundamentally tied to the church's religious mission.

The plaintiff sued the church, claiming it breached her employment contract by terminating her "without good and sufficient cause" as that term was defined by the contract. She sought monetary damages of $35,000, representing the salary she would have received but for her termination.

The church asked the court to dismiss the plaintiff's lawsuit on the basis of the "ministerial exception" which generally bars the civil courts from applying employment discrimination laws to hiring and firing decisions by churches involving clergy. A trial court agreed with the church and dismissed the plaintiff's claims. On appeal, the state supreme court affirmed the trial court's dismissal of the plaintiff's claims:

[The plaintiff] seeks state court enforcement of a provision in a private contract in order to invalidate a church's reason for terminating her employment. However, the First Amendment grants religious institutions "independence from secular control or manipulation—in short, power to decide for themselves, free from state interference, matters of church government as well as those of faith and doctrine" (quoting the United States Supreme Court's decision in Kedroff v. Saint Nicholas Cathedral of the Russian Orthodox Church, 344 U.S. 94 (1952). Therefore, the plaintiff asks the state courts to engage in activity that the Constitution prohibits … .

It has been universally recognized that the First Amendment protects religious institutions' decisions about whom to hire as ministerial employees and when to terminate their employment. Accordingly, a terminated ministerial employee's complaint alleging that her religious institution employer terminated her for an improper reason is not viewed through the lens that we usually apply when examining the legal sufficiency of a complaint. Rather, the allegations in the complaint are viewed in the context of the First Amendment's proscriptions against state interference with religious institutions' choices of who shall be the voice of their faith … .

When a ministerial employee is terminated, the religious institution's decision about who shall teach its faith and how that shall be done are intertwined with the decision to terminate the employee. Courts can have no role in affirming or overturning such a decision based on the reason why the religious institution terminated the employment.

The court quoted from the United States Supreme Court's 2012 decision unanimously affirming the ministerial exception: "Requiring a church to accept or retain an unwanted minister, or punishing a church for failing to do so, intrudes upon more than a mere employment decision. Such action interferes with the internal governance of the church, depriving the church of control over the selection of those who will personify its beliefs." Hosanna-Tabor Evangelical Lutheran Church and School v. E.E.O.C., 132 S.Ct. 694 (2012).

The Wisconsin court concluded:

The First Amendment grants [a church] free choice in deciding that a ministerial employee should be terminated because it is that type of employee who will preach [religious institutions'] beliefs, teach their faith, and carry out their mission. As the Supreme Court has explained, when a ministerial employee sues her religious employer to contest the validity of the reason for which she was fired, "the First Amendment has struck the balance for us. The church must be free to choose those who will guide it on its way … ."

Stated otherwise, if [the plaintiff's] claim is not dismissed, a court will be required to decide whether [the church] terminated her without "good and sufficient cause," within the meaning of those terms in the contract … . Furthermore, if a court were to award damages [to the plaintiff] the church would be required, by the state, to pay for its decision to terminate an unwanted ministerial employee. This, the First Amendment does not permit. As the United States Supreme Court has said, "an award of such relief would operate as a penalty on the church for terminating an unwanted minister, and would be no less prohibited by the First Amendment than an order overturning the termination."

What This Means For Churches:

This case is important because it extends the breadth of the ministerial exception to include breach of contract claims. The Supreme Court's ruling in the Hosanna-Tabor case in which it unanimously affirmed the ministerial exception involved the application of an employment discrimination law to clergy. The Wisconsin Supreme Court, like many other courts, have reached the logical conclusion that the reasoning supporting the application of the ministerial exception in the context of employment discrimination laws is equally applicable to other employment disputes involving churches and their ministers. DeBruin v. St. Patrick Congregation, 816 N.W.2d 878 (Wis. 2012).

Legal Developments

Church Sued for Supervisor’s Sexual Harassment

Court in Oklahoma ruled that plaintiff was treated wrongfully by the church.

Richard R. Hammar, Attorney, CPA
Bio

Key point 8-12.5. Sexual harassment is a form of sex discrimination prohibited by Title VII of the Civil Rights Act of 1964. It consists of both "quid pro quo" harassment and "hostile environment" harassment. Religious organizations that are subject to Title VII are covered by this prohibition. An employer is automatically liable for supervisory employees' acts of harassment, but a defense is available to claims of hostile environment harassment if they have adopted a written harassment policy and an alleged victim fails to pursue remedies available under the policy. In some cases, an employer may be liable for acts of sexual harassment committed by nonsupervisory employees, and even nonemployees.

New study on sexual harassment in the Christian workplace: Learn about the extent of this troubling problem in churches and parachurch ministries.

Key point 8-16. State and federal civil rights laws generally prohibit employers from retaliating against an employee for filing a discrimination claim or otherwise exercising rights provided by the law.

A federal district court in Oklahoma ruled that a church could be sued on the basis of sexual harassment for the conduct of a supervisory employee even though it was not aware of it at the time it occurred. A female church employee (the "plaintiff") claimed that over the course of a year she was sexually harassed by her supervisor. The harassment included both language and physical conduct. The plaintiff resisted her supervisor's advances, and this led directly to a reduction in her hours.

Plaintiff reported the sexual harassment to the church. After doing so, her hours continued to be reduced until she was terminated. The church insisted that the plaintiff quit her job.

The plaintiff sued the church, alleging sexual harassment, retaliation, wrongful termination, and negligence.

Sexual Harassment

Title VII of the Civil Rights Act of 1964 prohibits employers with 15 or more employees from discriminating in employment decisions on the basis of race, color, national origin, sex, or religion. Sexual harassment is a form of sex discrimination prohibited by Title VII. The courts have identified two types of sexual harassment—"quid pro quo" and hostile environment. "Quid pro quo" harassment refers to conditioning employment opportunities on submission to a sexual or social relationship, while "hostile environment" harassment refers to the creation of an intimidating, hostile, or offensive working environment through unwelcome verbal or physical conduct of a sexual nature. In general, an employer is liable for a supervisory employee's hostile environment sexual harassment.

The plaintiff claimed that she was subjected to a sexually hostile work environment due to the actions of her supervisor. The court noted that "a plaintiff may prove the existence of hostile work environment sexual harassment in violation of Title VII where sexual conduct has the purpose or effect of unreasonably interfering with an individual's work performance or creating an intimidating, hostile, or offensive working environment … For sexual harassment to be actionable, it must be sufficiently severe or pervasive to alter the conditions of [the victim's] employment and create an abusive working environment."

The church claimed that the plaintiff had not shown that any alleged harassment was sufficiently severe or pervasive to alter the conditions of her employment. The court disagreed, and rejected the church's request that the lawsuit be dismissed:

The court finds plaintiff has set forth sufficient evidence to create a genuine issue of material fact as to whether she suffered sexual harassment that was sufficiently severe or pervasive to alter the conditions of her employment and create an abusive working environment. Specifically, plaintiff has submitted evidence that for a year … she was verbally and physically sexually harassed by her supervisor, in that on a weekly, and near daily basis, he referred to her by sexually offensive names and on some 15 occasions, on a weekly and near bi-weekly basis, he either grabbed, groped, pinched, slapped, and squeezed her breasts or buttocks … or he forcibly pinned her against a wall with his body and kissed or tried to kiss her, or he directly requested she engage in sexual intercourse.

The court rejected the church's argument that it could not be liable for the supervisor's conduct since it had no knowledge it was occurring. It observed, "An employer is subject to liability to a victimized employee for a hostile environment created by a supervisor with immediate (or successively higher) authority over the employee." Since the supervisor was the plaintiff's immediate supervisor having immediate authority over her, "whether the church had knowledge of any alleged sexual harassment is not dispositive of the church's liability."

Retaliation

The court rejected the church's request to dismiss the plaintiff's retaliation claim that she had been wrongfully retaliated against her pursuing her harassment claim. Many federal and state civil rights laws that ban discrimination in employment prohibit employers from "retaliating" against employees who oppose discriminatory practices or pursue claims of discrimination. To illustrate, Title VII of the Civil Rights Act of 1964, the federal Age Discrimination in Employment Act, and the Americans with Disabilities Act all prohibit employer retaliation.

The court noted that for the plaintiff to establish a claim of discrimination she had to show that "(1) she engaged in opposition to discrimination; (2) she was subject to adverse employment action; and (3) a connection existed between the protected activity and the adverse action."

The church claimed that there was no retaliation since the plaintiff suffered no adverse employment action. The court disagreed:

The Court finds plaintiff has set forth sufficient evidence to create a genuine issue of material fact as to whether she was subject to an adverse employment action. Having reviewed the parties' submissions, it is clear there is a genuine dispute as to whether plaintiff quit her employment with the church or whether she was terminated. The court would also note that plaintiff has submitted evidence showing that her hours were greatly reduced both after she rejected her supervisor's alleged sexual advances and after she reported the sexual harassment to the church.

Accordingly, the Court finds that summary judgment should not be granted as to plaintiff's retaliation claim.

Constructive Discharge

The court refused to dismiss the plaintiff's claim of "constructive discharge," noting that "when an employer controls the working hours and reduces the number of working hours, a constructive discharge can occur if the employee quits."

Negligence

The plaintiff claimed that the church was responsible for its supervisor's acts of sexual harassment on the basis of negligence due to its failure to "investigate, respond, or discipline" the supervisor. In rejecting the church's request to dismiss this claim the court observed:

Employers may be held liable for negligence in hiring, supervising or retaining an employee. In such instances, recovery is sought for the employer's negligence. The claim is based on an employee's harm to a third party through employment. An employer is found liable, if—at the critical time of the tortious incident—the employer had reason to believe that the person would create an undue risk of harm to others. Employers are held liable for their prior knowledge of the employee's propensity to commit the very harm for which damages are sought … . The critical element for recovery is the employer's prior knowledge of the employee's propensities to create the specific danger resulting in damage.

The court concluded that there was sufficient evidence that the church was aware of prior acts of sexual harassment by the supervisor to allow this claim to proceed.

What this means for churches

This case is important because it demonstrates that a church may be liable for a supervisory employee's acts of sexual harassment even though it had no actual knowledge that they occurred.

Sexual harassment is a form of "sex discrimination" prohibited by Title VII of the Civil Rights Act of 1964. Equal Employment Opportunity Commission (EEOC) regulations define sexual harassment as follows:

a. Harassment on the basis of sex is a violation of Sec. 703 of Title VII. Unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature constitute sexual harassment when (1) submission to such conduct is made either explicitly or implicitly a term or condition of an individual's employment, (2) submission to or rejection of such conduct by an individual is used as the basis for employment decisions affecting such individual, or (3) such conduct has the purpose or effect of unreasonably interfering with an individual's work performance or creating an intimidating, hostile, or offensive working environment.

This definition confirms the conclusion reached by numerous state and federal courts that sexual harassment includes at least two separate types of conduct:

1. "quid pro quo" harassment, which refers to conditioning employment opportunities on submission to a sexual or social relationship, and

2. "hostile environment" harassment, which refers to the creation of an intimidating, hostile, or offensive working environment through unwelcome verbal or physical conduct of a sexual nature.

An employer may be liable for a supervisor's acts of "hostile environment" sexual harassment even if it was not aware the acts were happening when they occurred. The basic rule may be stated as follows: If a supervisor creates an intimidating, hostile, or offensive working environment through unwelcome verbal or physical conduct of a sexual nature, this is "hostile environment" sexual harassment for which the employer will be legally responsible if the supervisor takes any "tangible employment action" against the employee. A tangible employment action includes "a significant change in employment status, such as hiring, firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing a significant change in benefits." The employer is liable under such circumstances whether or not it was aware of the harassment.

An employer may be liable for a supervisor's acts of hostile environment sexual harassment even if it takes no tangible employment action against the victim. But, in such cases, the employer may assert an "affirmative defense" to liability. This defense consists of two elements:

i. The employer "exercised reasonable care to prevent and correct promptly any sexually harassing behavior." This generally means that the employer adopted a written sexual harassment policy that was communicated to employees, and that contains a complaint procedure.

ii. The victim "unreasonably failed to take advantage of any preventive or corrective opportunities provided by the employer or to avoid harm otherwise." This generally means that the victim failed to follow the complaint procedure described in the employer's sexual harassment policy.

As a result, it is a "best practice" for a church with employees to adopt a sexual harassment policy, since this will serve as a defense to liability for a supervisor's acts of "hostile environment" sexual harassment to the extent that a victim of such harassment does not follow the policy. 2012 WL 2912516 (W.D. Okla. 2012).

Legal Developments

There Is No Legal Duty to Perform Background Checks on Every Applicant

Specifically when the position for hire is low-risk.

Richard R. Hammar, Attorney, CPA
Bio

Employment practices

Key point 10-04. A church may be liable on the basis of negligent selection for a worker's molestation of a minor if the church was negligent in the selection of the worker. Negligence means a failure to exercise reasonable care, and so negligent selection refers to a failure to exercise reasonable care in the selection of the worker. Liability based on negligent selection may be imposed upon a church for the acts of employees and volunteers.

Key point 10-04.3. Churches can reduce the risk of liability based on negligent selection for the sexual molestation of minors by adopting risk management policies and procedures.

Key point 10-05.2. Some courts have found churches not liable on the basis of negligent selection for the sexual misconduct of a minister or other church worker involving another adult since the church exercised reasonable care in the selection of the worker.

Key point 10-05.3. Churches can reduce the risk of liability based on negligent supervision for sexual misconduct involving adult victims by adopting risk management policies and procedures.

Do employers have a legal duty to perform criminal background checks on every applicant for employment? No, concluded a federal appeals court applying Mississippi law. A female worker (the "plaintiff") was raped by a co-worker. She sued her employer, claiming it was responsible for her injuries on the following grounds:

A federal district court dismissed the plaintiff's lawsuit, and the plaintiff appealed. A federal appeals court concluded that Mississippi law "does not support her first two arguments. Furthermore, she offers virtually no authority for the proposition that [her employer] had a duty to conduct criminal background checks on [its workers]." As a result, the court affirmed the district court's dismissal of the plaintiff's lawsuit.

Do employers have a legal duty to conduct criminal background checks on new employees?
The court noted that "numerous other jurisdictions" have addressed this question, and that the "unanimous rule, with only minor and nuanced deviation, is that: 'One can normally assume that another who offers to perform simple work is competent. If, however, the work is likely to subject third persons to serious risk of great harm, there is a special duty of investigation …. We decline to infer a generalized duty on employers to conduct criminal background checks on all prospective employees ….'"

The court noted that the employer hired the assailant to work on an environmental remediation project, and that

Nothing about the nature of that work could have suggested to [the employer] that he was likely to subject [the plaintiff] to the risk of assault, or was otherwise uniquely incompetent to perform the work. If a criminal background check were necessary to screen for indicia that a manual laborer might assault a co-worker, it is difficult to envision a fact pattern in which a background check would not be necessary. Of course, the unanimous case law from around the country says that there is no such generalized duty on employers, to conduct pre-employment background checks on all new hires, irrespective of the particular circumstances of their prospective employments.

The court noted that this conclusion was strengthened by the fact that Mississippi's legislature has mandated that employers conduct criminal background checks on all new hires in specified fields, including teachers, health care facility employees, nursing home administrators, and pharmacists. It reasoned that "if Mississippi's legislature intended to rely on common law principles to impose a duty on employers to conduct criminal background checks on all employees, it would not have resorted to statutes to impose them in specified fields …. Similarly, by not specifying manual labor as a field requiring background checks, Mississippi's legislature created the strong inference that it did not intend to mandate them for all new hires in that field."

The court concluded:

We are especially hesitant to impose a generalized common law duty to conduct background checks under Mississippi law when (i) no prior Mississippi precedent directly imposes such a duty; (ii) the Mississippi Supreme Court has expressly adopted Section 213 of the Restatement (Second) of Agency, which rejects such a duty; (iii) no other jurisdiction imposes such a duty in comparable circumstances; and (iv) Mississippi's legislature has imposed a statutory duty to conduct background checks in certain specified fields, but not in the instant one.

Is non-compliance with internal corporate hiring policies evidence of negligence under Mississippi law?
The plaintiff claimed that the employer's internal policies, which purportedly required background checks on all new hires, created a legal duty that it breached. The court concluded that an employer's violation of its own internal policies did not, in itself, establish negligence: "Under Mississippi law, breach of one's internal policies may be considered in determining whether one has exercised the appropriate standard of care …. However, internal policies are only one consideration among many in that determination …. We are not aware of any cases in which a party's violation of its own internal safety policies established a dangerous condition per se …. For these reasons [the plaintiff's] second argument also fails. [Her employer's] non-compliance with its internal policies, which purportedly require background checks on all new hires, is not dispositive evidence of their breach of duty [of care]."

'(N)on-compliance with an internal corporate policy or custom is evidence merely suggestive of breach of duty, not evidence dispositive of it.'

Are criminal records checks on employees an "industry practice" that the employer violated?
The plaintiff insisted that conducting background checks on all new hires is "standard corporate practice," and so the employer's failure to conduct a criminal records background check on the assailant amounted to negligent hiring. The court rejected this argument, noting that "non-compliance with an internal corporate policy or custom is evidence merely suggestive of breach of duty, not evidence dispositive of it."

What This Means For Churches:
This case is important for the following reasons:

  1. It is a ruling by a federal circuit court of appeals. Such rulings are controlling in the relevant circuit (in this case, Louisiana, Mississippi, and Texas), and generally are given great deference by courts in other jurisdictions. So, the court's analysis of an employer's duty to conduct criminal background checks is a significant legal precedent.
  2. The court concluded that "the unanimous case law from around the country says that there is no generalized duty on employers, to conduct pre-employment background checks on all new hires, irrespective of the particular circumstances of their prospective employments."
  3. Every state legislature has enacted legislation mandating criminal records checks on persons seeking employment in specified occupations, such as teaching. The court concluded that these laws demonstrate that no generalized duty on the part of all employers to conduct criminal records checks exists, since if a legislature "intended to rely on common law principles to impose a duty on employers to conduct criminal background checks on all employees, it would not have resorted to statutes to impose them in specified fields."
  4. The court concluded that an employer's noncompliance with its internal policies is evidence of negligence, but does not establish negligence.
  5. This case should not be viewed by church leaders as an excuse not to screen workers. Rather, it can be used by churches to defend against a negligence claim in the event that an employee or volunteer for whom a criminal records check was not performed sexually molests a child or an adult. These failures can occur in a number of ways. For example, a long-term volunteer worked at the church long before a criminal records check policy was adopted, and the church decided to perform these checks only on new workers.
  6. The best practice, whether or not required by applicable law, is for churches to conduct thorough background checks, including references, criminal records checks, and a review of the national sex offender public registry (nsopw.gov). While familiarity with legal requirements is essential, such requirements are superseded by the moral constraints imposed by the higher law of scripture, which commands the community of faith to protect those who are made in God's image.
  7. The sexual abuse of minors by persons working for churches and other youth-serving charities is a persistent and virulent threat. Our research reveals that the sexual abuse of minors has been the number one basis for church litigation in six of the past seven years. Many secular charities—including public schools, Boy Scouts of America, Girl Scouts, Big Brothers and Sisters, Boys and Girls Clubs, youth soccer leagues, 4-H, and Little League—have responded to this risk by mandating criminal records checks for persons who will work with minors. Many churches are doing the same. Criminal records checks not only reduce the risk of child molestation, but they also reduce the risk of institutional liability based on negligent selection. They also are relatively inexpensive and easily accessible.

    8. Many leaders of churches and other youth-serving charities were stunned when the U.S. Equal Employment Opportunity Commission (EEOC) suggested recently that the use of criminal records checks may violate Title VII of the Civil Rights Act of 1964, which generally prohibits discrimination in employment on the basis of race, color, national origin, gender, or religion, by employers with at least 15 employees that are engaged in interstate commerce.

    Do churches and other youth-serving charities, in their efforts to protect children by requiring criminal records checks for youth workers, thereby expose themselves to liability for violating Title VII? It's a classic dilemma—an attempt to avoid one form of liability results in potential liability for another.

    The court alluded to this potential basis for liability by noting, in a footnote, that because of its dismissal of the plaintiff's claims "we need not address [the employer's] arguments concerning the potential conflict of such a generalized duty [to conduct criminal records checks on all employees] especially if an adverse background check would jeopardize the prospective hire's employment, with Title VII of the Civil Rights Act of 1964 and its implementing regulations." Keen v. Miller Environmental Group, Inc., 702 F.3d 239 (5th Cir. 2012).

    Screening workers

    * See "Employment practices," Keen v. Miller Environmental Group, Inc., 702 F.3d 239 (5th Cir. 2012), and "Sexual misconduct by clergy, lay employees, and volunteers," Doev. Corporation, 964 N.E.2d 370 (Mass. App. 2012), in the Recent Developments section of this newsletter.

    Church Law & Tax Report is published six times a year by Christianity Today International, 465 Gundersen Dr. Carol Stream, IL 60188. (800) 222-1840. © 2013 Christianity Today International. editor@churchlawandtax.com All rights reserved. This publication is designed to provide accurate and authoritative information in regard to the subject matter covered. It is sold with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. "From a Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations." Annual subscription: $69. Subscription correspondence: Church Law & Tax Report, PO Box 37012, Boone, IA 50037-0012.

Legal Developments

Court Applies “Ministerial Exception” to Church Discrimination Case

Employee discrimination claim left to church’s decision.

Richard R. Hammar, Attorney, CPA
Bio

Church Law & Tax Report

Court Applies “Ministerial Exception” to Church Discrimination Case

Employee discrimination claim left to church’s decision.

Richard R. Hammar, J.D., LL.M., CPA

Key point 8-10.1. The civil courts have consistently ruled that the First Amendment prevents the civil courts from applying employment laws to the relationship between a church and a minister.

Key point 8-12.1. Title VII of the Civil Rights Act of 1964 prohibits employers engaged in commerce and having at least 15 employees from discriminating in any employment decision on the basis of race, color, national origin, gender, or religion. Religious organizations are exempt from the ban on religious discrimination, but not from the other prohibited forms of discrimination.

Key point 8-12.4. Title VII of the Civil Rights Act of 1964 prohibits employers engaged in commerce and having at least 15 employees from discriminating in any employment decision on the basis of race, color, national origin, gender, or religion. The Act permits religious organizations to discriminate in employment decisions on the basis of religion. This exemption permits such organizations to discriminate on the basis of moral or scriptural standards so long as they do consistently and not in a way that adversely impacts employees who are members of a group that is protected under an applicable state or federal discrimination law.

A California appellate court ruled that it was barred by the “ministerial exception” from resolving the discrimination claims of a church preschool director who was terminated on the basis of her decision to live with her boyfriend without the benefit of marriage. A preschool operated by a Lutheran church required its teachers to sign a document prior to the start of each school year setting forth professional expectations. The preschool director (the “plaintiff”), who had teaching responsibilities, was required to sign the form. The plaintiff knew the school was “Bible-based.” Although teachers were not required to attend the church, or be Lutheran (the plaintiff is Catholic) they were required to be practicing Christians “involved in a church-based setting on a regular basis.”

The parents of students did not have to be Lutherans, but they, too, had to be practicing Christians.

As director of the preschool, the plaintiff made the classroom arrangements, helped hire teachers, and scheduled their hours and classroom assignments. She also processed the applications for incoming students and made sure the school complied with state mandates. Every week she gave a tour of the preschool to parents of prospective students. During the tour she talked to the parents about the “Christian-based, Bible-based values of the school.” She wanted the parents to understand that if they sent their children to the school, they could expect their children to receive a “Christian education” and Biblebased “Christian values.”

Every week the teachers participated in devotions. They read from a devotional book, took prayer requests from the group, and prayed for each other. As a teacher, the plaintiff taught religion to the preschoolers as a part of the regular curriculum. She spoke to the children about Jesus on a daily basis. Two or three times a week she taught a Bible story in conjunction with the theme being taught that week. The plaintiff claimed that the Christian themes she introduced related to Christianity in general and “not specifically to Lutheran doctrine or teachings.” On occasion when the need to discipline a child arose, she would “bring in some theme from a Bible story or a teaching of Christianity.”

Every Wednesday the preschool classes and their teachers attended chapel for about half an hour. The plaintiff was in charge of the chapel service three to four times a school year. The responsibility of reading a Bible story or performing some other act of religious teaching during chapel rotated among the teachers. The plaintiff led her class in prayer each day: at the beginning of each day, before each meal, and at the end of each day. The plaintiff estimated she spent one hour a week teaching religion, another hour leading the children in prayer, and the remainder of the time she spent teaching—other than those times she was in charge of the chapel service—was spent on “secular subjects, including such things as: numbers and counting; the alphabet and letter concepts; basic science; small motor control; large motor control; social, emotional, physical and language skills; and computer skills.”

The plaintiff was married when she applied to the school for a teaching position. She subsequently divorced and gave birth to a child fathered by her boyfriend. While she was pregnant, she told representatives of the church that she intended to get married, but was not ready to do so just yet. She returned to the school for the following school year. She stated that she believed the school would not punish her for having had a baby out of wedlock. She lived with her boyfriend prior to having the baby, but did not know whether the principal of the school was aware they were living together.

Eventually, the church’s pastor met with the plaintiff. They discussed her living with her boyfriend and he asked whether she intended to marry him. The plaintiff said she and her boyfriend intended to get married, but did not know when. She understood that her living arrangement was “contrary to the religious and moral beliefs of the church.” The plaintiff knew before she became pregnant that living with boyfriend was contrary to the teachings of the Bible.

The school terminated the plaintiff’s employment for living with her boyfriend and raising their son together without being married, a “failure to adhere with the professional expectations of the teaching staff in that her living arrangements were contrary to the religious beliefs of the church and school.”

The plaintiff sued the church, alleging that the church terminated her employment based upon her marital status, in violation of Title VII of the Civil Rights Act of 1964. The court entered judgment in the church’s favor on the ground that the church is a religious institution, and that the plaintiff’s employment was terminated because she violated a church precept. The plaintiff appealed.

Title VII

The plaintiff insisted that “the law does not allow the church to discriminate against non-ministerial employees based on gender or marital status.” But the court pointed out that Title VII does not bar employment discrimination based on marital status, and that the plaintiff failed to cite any law declaring a public policy against marital status discrimination.

The trial court found the church terminated the plaintiff’s employment because she violated a church precept. According to the church, the plaintiff’s employment was terminated not because she had a baby out of wedlock, and not because she remained unmarried, but because she continued to live with her boyfriend in a sexual relationship while unmarried. The court concluded that the evidence supported the church’s position:

After the plaintiff’s marriage ended, she lived with her boyfriend and became pregnant. There is no evidence the school’s principal or the church knew of the plaintiff’s living situation at that time. The church did not terminate her employment for being pregnant. Neither did it fire her when she had the baby out of wedlock. In fact, she gave birth to her son in June 2007 and went back to teaching at the beginning of the next school year, 2007-2008. The plaintiff testified she knew she would not be punished for having had a baby. It was only at the end of 2008, when the principal became aware that parents of children at the school knew of and were talking about the plaintiff living with her boyfriend and raising their child out of wedlock, that the plaintiff was informed by the school that she had to make a choice. The plaintiff knew she was expected to live by the teachings of the Bible and that her living arrangement was “contrary to the religious and moral beliefs of the church.”

Had the plaintiff decided to marry her boyfriend, the church would have been satisfied. But the church would also have been satisfied and the plaintiff would have kept her job even if she decided against marrying him. She could have moved out of their shared residence. In fact, after the plaintiff explained to the school board her hesitancy to remarry, one of the school board members specifically asked her, “Why do you have to live with him?” What the church could not allow was to have the plaintiff, its face and representative to the students and parents of the students who attended its school, to continue living in what it considered a sinful manner. In other words, if the plaintiff stopped living with her boyfriend she could continue in her job. That being the case, the evidence at trial indicates her employment was terminated based upon a matter of religion, not her sex and not her having had a baby out of wedlock.

The court noted that Title VII bans employment discrimination based on race, color, national origin, gender, and religion, but exempts religious organizations “from Title VII liability on the basis of religious discrimination.” Under Title VII’s religious exemption, “the decision to employ individuals of a particular religion … has been interpreted to include decisions to terminate an employee whose conduct or religious beliefs are inconsistent with those of its employer.” The court continued:

Whereas a religious organization’s termination of an employee’s employment for becoming pregnant would violate Title VII, terminating the employment because the employee committed adultery—a violation of the religious organization’s requirement that the employee live a life in conformity with the fundamentalist beliefs of the church would not be a violation. In this case, the evidence at trial supports a finding that the plaintiff’s employment was terminated because she was living with her boyfriend in a sexual relationship and was raising their child in that living arrangement, and not because she was a woman or became pregnant or had a baby out of wedlock. As the plaintiff admitted on cross-examination, she understood that “living with [her] child’s father and not being married was contrary to the school and church’s expectation of [her] as a Christian, setting a Christian role model.” The judgment in favor of defendant does not violate any public policy rooted Title VII.

the ministerial exception

The court next addressed the church’s claim that the “ministerial exception” barred civil court resolution of the plaintiff’s claims. The court explained the ministerial exception as follows:

The ministerial exception doctrine is based on the notion a church’s appointment of its clergy, along with such closely related issues as clerical salaries, assignments, working conditions and termination of employment, is an inherently religious function because clergy are such an integral part of a church’s functioning as a religious institution. Therefore, secular courts will not attempt to right wrongs related to the hiring, firing, discipline or administration of clergy. Implicit in this statement of the rule is the acknowledgment that such wrongs may exist, that they may be severe, and that the administration of the church itself may be inadequate to provide a remedy. The preservation of the free exercise of religion is deemed so important a principle as to overshadow the inequities which may result from its liberal application. In our society, jealous as it is of separation of church and state, one who enters the clergy forfeits the protection of the civil authorities in terms of job rights.

Dismissing an Employee for Violation of a Church’s Moral Teachings

Before dismissing an employee for violating the church’s moral teachings, church leaders should ask the following questions:

  1. Is there sufficient evidence to support our decision?
  2. Did we inform the employee, in an employee handbook or other document, that he or she would be subject to dismissal for engaging in behavior in violation of our moral teachings?
  3. How will we describe the basis for our decision? The best description will refer to the church’s doctrinal tenets, and scriptural citations. Stay away from words such as “pregnancy” that can have a “secular” meaning, and that diminish the “religious exemption” available to churches under most federal and state civil rights and employment laws.
  4. How have we treated other employees in the past who were guilty of the same kind of misconduct? Have we treated all employees equally? Or, have we treated some employees less favorably than others? For example, have we dismissed female employees who were guilty of extramarital sexual relations, but only warned or reprimanded male employees guilty of the same behavior? Before dismissing an employee for misconduct, church leaders should review all other known cases involving similar misconduct by other employees. Be sure that an employee who is protected against discrimination by state or federal law is not treated less favorably than other employees in previous cases.
  5. Have we consulted with an attorney before taking final action?

    6. The court explained that the ministerial exception is not limited to churches, but extends to “church-related institutions which have a substantial religious character,” including church-affiliated schools. Further, the exception is not limited to members of the clergy, but encompasses “all employees of a religious institution, whether ordained or not, whose primary functions serve its spiritual and pastoral mission.” The court concluded that the ministerial exception applied to the plaintiff, and barred consideration of her claims. In particular, it noted that the plaintiff: (1) led the students in prayer at the beginning and end of each day and before each meal; (2) was responsible for leading chapel up to four times a year; (3) regularly taught religion in her classes, including secular classes; (4) participated in weekly devotions with the staff at which they would read a devotional-type book and then take prayer requests and pray for each other; (5) led staff prayers; and (6) conducted tours for parents of student applicants, assuring them of the school’s Christian atmosphere. The court concluded: “The minister is the chief instrument by which the church seeks to fulfill its purpose …. One such purpose is to bring people to the church. The plaintiff fulfilled that function by teaching her preschoolers religion, leading them in prayers every day, and leading chapel services. She taught religion and spread the faith. We find the ministerial exception applies in this matter.”

    What This Means For Churches:

    This case is significant for the following reasons.

    First, it illustrates the importance of accurately describing the basis for terminating an employee. As this case illustrates, there is a critical legal difference between dismissing an employee on account of pregnancy (even if out of wedlock) and dismissing an employee on account of adultery (of which pregnancy is merely evidence). The court acknowledged that dismissing a pregnant employee on account of adultery is permissible under Title VII, though dismissing an employee on account of pregnancy is not. It does not matter that pregnancy out of wedlock violates a church’s religious teachings and values. Title VII does not exempt churches from discrimination based on pregnancy. It does exempt churches from discrimination based on adultery. The takeaway point is the importance of correctly and adequately describing the basis for employee terminations and discipline. To avoid confusion, religious organizations that take an adverse employment action against an employee or applicant for employment as a result of the organization’s moral teachings should word their determination with references to relevant passages from scripture and church doctrine. This will make it more likely that a court will view the decision as a protected form of religious discrimination.

    Second, a number of courts have ruled that Title VII’s exemption of religious organizations from the ban on religious discrimination in employment does not apply if a religious organization uses religion as a “pretext” to discriminate against a member of a protected class. This is a very important qualification. Religious organizations can discriminate in their employment decisions on the basis of religion, but they must be consistent. To illustrate, a church that dismisses only female employees on the basis of extramarital sexual relations could not justify this practice on the basis of the Title VII exemption.

    Third, note that most churches are not subject to Title VII, which only applies to employers that have 15 or more employees and are engaged in interstate commerce. However, many states have their own versions of Title VII, and some churches will be covered under these laws. Fortunately, most of them (like Title VII) exempt religious employers from discrimination based on religion. Some exempt religious employers from all the discrimination prohibitions. Evangelical Lutheran Church, 134 Cal.Rptr.3d 15 (Cal. 2012).

    Key point 8-09.1. Many federal employment and civil rights laws apply only to those employers having a minimum number of employees. In determining whether or not an employer has the minimum number of employees, both fulltime and part-time employees are counted. In addition, employees of unincorporated subsidiary ministries of a church are counted. The employees of incorporated subsidiary ministries may be counted if the church exercises sufficient control over the subsidiary.

Legal Developments

Violating the Americans with Disabilities Act

Church terminates employee for refusing to work weekends to care for disabled daughter.

Richard R. Hammar, Attorney, CPA
Bio


Key point 8-14.1. The federal Americans with Disabilities Act prohibits employers with at least 15 employees, and that are engaged in interstate commerce, from discriminating in any employment decision against a qualified individual with a disability who is able, with or without reasonable accommodation from the employer, to perform the essential functions of the job. Accommodations that impose an undue hardship upon an employer are not required. Religious organizations may give preference to nondisabled members of their faith over disabled persons who are members of a different faith.

A federal district court in Illinois ruled that a church did not violate the Americans with Disabilities Act by dismissing an employee who refused to work on weekends in order to be home with her disabled daughter. A church hired a receptionist (the "plaintiff"). Her job required that she work on weekends. Within a week of hiring her, the church learned that the plaintiff's daughter had mental disabilities and lived in a residential care facility. Since the plaintiff could only take her daughter home to visit on weekends, she asked the church to adjust her schedule to allow her to be home with her daughter. She claimed that the church failed to accommodate her, and required her to work on weekends in violation of federal and state law. The situation continued to deteriorate, with the plaintiff refusing to work on weekends despite the church's insistence that she do so. The church eventually terminated her employment, citing her "continued poor performance" and refusal to work weekends.

The plaintiff filed a complaint with the Equal Employment Opportunity Commission (EEOC), and later sued the church in federal court. The sole issue in the case was whether the church unlawfully discriminated against the plaintiff on account of her daughter's mental disability, in violation of the Americans with Disabilities Act (ADA). The church asked the court to dismiss the plaintiff's lawsuit.

The court noted that the ADA prohibits covered employers from "excluding or otherwise denying equal jobs or benefits to a qualified individual because" he or she has a relationship with a disabled person. This provision was enacted "to stop employers from refusing to hire a qualified person out of fear that she will, for example, miss work to care for a disabled child." However, the court noted that "firing an employee who violates "a neutral employer policy concerning attendance or tardiness," even to care for a disabled person, does not violate the ADA." That is, "there is no obligation to reasonably accommodate a nondisabled employee," and "employees are not entitled to (a) modified work schedule to allow them to care for a disabled family member."

The court concluded:

The church offers evidence that it terminated the plaintiff for nondiscriminatory reasons: poor performance and her unwillingness to alter her schedule. Under [existing law] she must refute each ground by offering evidence that it is a mere pretext …. The court finds that the pretext evidence proffered here is insufficient to protect the plaintiff from summary judgment.

We are sympathetic to the position in which plaintiff found herself. Her legitimate need to be home with her daughter conflicted with the church's need to have both members of their full-time staff available to work some weekend hours. However, that does not mean that the church's decision to dismiss the plaintiff violated the ADA. United Methodist Church, 2011 WL 5515521 (N.D. Ill. 2011).

Legal Developments

15-Employee Requirement for Churches

Church affiliates do not have to combine overall number of employees to meet Title VII rule.

Richard R. Hammar, Attorney, CPA
Bio

Church Law & Tax Report

15-Employee Requirement for Churches

Church affiliates do not have to combine overall number of employees to meet Title VII rule.

Richard R. Hammar, J.D., LL.M., CPA

A federal appeals court ruled that the 15-employee requirement under Title VII of the Civil Rights Act of 1964 could not be met by combining the employees of a church and affiliated entity, since they were not sufficiently related organizationally. A maintenance worker (the “plaintiff”) at a church-affiliated apartment building (the “Manor”) sued the Manor as a result of his supervisor’s acts of sexual harassment in violation of Title VII of the Civil Rights Act of 1964. Title VII prohibits any employer, including a church, that is engaged in commerce and that has 15 or more employees from discriminating in any employment decision as a result of a person’s race, color, national origin, sex (including sexual harassment), or religion.

The Manor is a not-for-profit corporation formally governed by its members, all of whom are also members of the church. The members select an 11-member board of directors, which in turn elects four officers. Under the Manor’s articles of incorporation, the church’s pastor serves as a director, and all other officers and directors must be members of the church. At the time of the alleged harassment, two of the directors were church ministers. None of the officers or directors are paid for their services, and most either have full-time jobs elsewhere or are retired. The board meets on an as-needed basis, which tends to be every three to five months.

The Manor asked the court to dismiss the plaintiff’s Title VII claims against it on the ground that it was not subject to Title VII since it had fewer than 15 employees.

The court noted that employers are subject to Title VII only if they have at least 15 employees on each working day for 20 or more calendar weeks in either the year in which the alleged discrimination occurred or the preceding year. Entities that do not have 15 employees may still face liability through the single-employer or joint-employer doctrines. Under these doctrines, the employees of two related entities are combined in applying the 15-employee requirement.

Under the single-employer doctrine, “two nominally independent entities are so interrelated” that all of the employees of one are attributed to the other. Swallows v. Barnes & Noble Book Stores, Inc., 128 F.3d 990 (6th Cir.1997). The joint-employer doctrine involves a business that maintains sufficient control over some or all of the formal employees of another business as to qualify as those employees’ employer. But unlike in the single-employer context, the two businesses are in fact independent. With a single employer, all employees are aggregated to determine whether the 15-employee requirement has been met. With joint employers, only the employees over whom the first employer maintains sufficient control are aggregated with its own formal employees. The plaintiff relied on both doctrines to meet the 15-employee requirement since the Manor, by itself, had fewer than 15 employees.

The court concluded that the Manor and church could not be combined to meet the 15-employee requirement of Title VII:

The employees of two or more entities can be aggregated for [purposes of the 15-employee requirement] if the entities effectively operate as a single employer. In making this determination, courts consider factors such as interrelation of operations, common management, centralized control over labor relations and personnel, and common ownership or financial control. The presence or absence of any of these factors is not conclusive, but “control over labor relations is a central concern.”

None of the elements of interrelatedness identified in Swallows—common offices, common record keeping, shared bank accounts and equipment—are present here …. The plaintiff has shown some evidence of common management, as the church’s pastor serves as the Manor’s chairman of the board and another minister serves as board president. This type of arrangement is not always enough by itself to meet the second factor, however. Each director has an equal vote in Manor business and nine of the eleven board members have no employment or pecuniary relationship with the church.

The plaintiff has failed to show that the church has any role in the Manor’s personnel matters, the “central concern” of the single-employer doctrine. The church has no authority to hire or fire Manor employees and does not pay their wages and benefits. The plaintiff points out that his supervisor’s termination notice is on church letterhead, but it is signed by the pastor, who is chairman of the Manor’s board, and by the Manor’s board.

Finally, the church has no ownership interest in the Manor and the two entities do not share finances. Neither is a sham corporation, and without evidence of a sham, the fourth factor is not met.

At most, the plaintiff has presented some evidence of one of the four factors. Accordingly, he has not met his burden under the single-employer doctrine and we will not aggregate church employees with the Manor’s employees to determine if the Manor satisfies the [15 employee] requirement.

What This Means For Churches:

This case is yet another repudiation of the “single employer” or “single enterprise” theory in the context of churches and their affiliated ministries. In many cases it is very difficult for plaintiffs to meet the 15-employee requirement under Title VII by combining employees of a church and affiliated ministries, based on the four factors enumerated by the court in this case. These same factors have been applied by many courts, and represent a tool church leaders can employ in determining whether Title VII’s 15-employee requirement can be met by aggregating employees of a church and one or more affiliates. Sanford v. Main Street Baptist Church Manor, Inc., 449 Fed.Appx. 488 (6th Cir. 2012).

Legal Developments

Religious Discrimination in Employment Practices

Religious organizations are exempt from bans on religious discrimination.

Richard R. Hammar, Attorney, CPA
Bio

Church Law & Tax Report

Religious Discrimination in Employment Practices

Religious organizations are exempt from bans on religious discrimination.

Richard R. Hammar, J.D., LL.M., CPA

Key point 8-10.2. Some courts have not recognized the ministerial exception, usually because the complainant was not a minister in either status or function, or was employed by a secular organization.

Key point 8-11. Employees and applicants for employment who believe that an employer has violated a federal civil rights law must pursue their claim according to a specific procedure. Failure to do so will result in the dismissal of their claim.

Key point 8-12.1. Title VII of the Civil Rights Act of 1964 prohibits employers engaged in commerce and having at least 15 employees from discriminating in any employment decision on the basis of race, color, national origin, gender, or religion. Religious organizations are exempt from the ban on religious discrimination, but not from the other prohibited forms of discrimination.

Key point 8-13. The federal Age Discrimination in Employment Act prohibits employers with 20 or more employees, and engaged in interstate commerce, from discriminating in any employment decision on the basis of the age of an employee or applicant for employment who is 40 years of age or older. The Act does not exempt religious organizations. Many states have similar laws that often apply to employers having fewer than twenty employees.

A federal district court in Oklahoma ruled that a Roman Catholic parochial school was exempt from Title VII’s ban on religious discrimination in employment decisions; that the “ministerial exception” did not apply to a teacher employed by the parochial school; and, that the school did not violate age discrimination law in not renewing her contract. A parochial school employed a teacher (the “plaintiff”) for a one-year, renewable contract. Her contract was renewed each year for 10 years. During the 10th year, the school informed the plaintiff that her contract would not be renewed. She was 63 years old at that time. The plaintiff sued the school and church (the “defendants”) for unlawful employment discrimination based on religion and age.

religious discrimination

The plaintiff asserted that the defendants terminated her because she was an Episcopalian, and not a Catholic, in violation of the ban on religious discrimination under Title VII of the Civil Rights Act of 1964. The defendants noted that Title VII exempts religious organizations from the ban on religious discrimination in employment. Title VII provides: “This subchapter 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.”

The court dismissed the plaintiff’s religious discrimination claim based on Title VII’s exemption of religious organizations from the ban on religious discrimination. It observed: “Because the exemption applies to employees with religious or secular duties, the court need not determine whether [the plaintiff’s] duties were religious.”

The court also rejected the plaintiff’s argument that the defendant school was not a “religious” organization. It quoted from a 2007 federal appeals court decision:

Over the years, courts have looked at the following factors [in determining if an employer qualifies as a religious organization]: (1) whether the entity operates for a profit, (2) whether it produces a secular product, (3) whether the entity’s articles of incorporation or other pertinent documents state a religious purpose, (4) whether it is owned, affiliated with or financially supported by a formally religious entity such as a church or synagogue, (5) whether a formally religious entity participates in the management, for instance by having representatives on the board of trustees, (6) whether the entity holds itself out to the public as secular or sectarian, (7) whether the entity regularly includes prayer or other forms of worship in its activities, (8) whether it includes religious instruction in its curriculum, to the extent it is an educational institution, and (9) whether its membership is made up by coreligionists …. Not all factors will be relevant in all cases, and the weight given each factor may vary from case to case. LeBoon v. Lancaster Jewish Community Center, 503 F.3d 217 (3rd Cir.2007).

The court concluded that the defendant school was a religious organization under this test. It noted that the school was operated by a church organized under the Canon Law of the Roman Catholic Church; that the school taught many secular subjects, but also required religious instruction for all students; that the church’s pastor supervises some school decisions, such as whether or not to renew teachers’ contracts; and the school’s student handbook describes the school as “first and foremost a Catholic school [that] embraces the Catholic traditions of mass, personal prayer and stewardship.”

the ministerial exception

The court rejected the defendants’ claim that the plaintiff’s entire case had to be dismissed as a result of the “ministerial exception,” which bars civil courts from interfering with employment disputes between churches and ministers. While the United States Supreme Court affirmed the ministerial exception earlier this year (see the Feature Article in the March/April 2012 edition of CHURCH LAW & TAX REPORT), it left undefined the term “minister.”

The federal court in Oklahoma concluded that the plaintiff, a fifth-grade teacher in a parochial school, was not a minister for purposes of the ministerial exception. The court applied the most commonly used definition of “minister” in applying the ministerial exception: “As a general rule, if the employee’s primary duties consist of teaching, spreading the faith, church governance, supervision of a religious order, or supervision or participation in religious ritual and worship, he or she should be considered ‘clergy.'” Rayburn v. Gen. Conf. of Seventh-Day Adventists, 772 F.2d 1164 (4th Cir.1985).

The court noted that several courts have concluded that the ministerial exception applies to principals of parochial schools. But, on the other hand, “the overwhelming majority of courts that have considered the issue have held that parochial school teachers … who teach primarily secular subjects, do not classify as ministerial employees for purposes of the exception.”

The court added:

It is difficult to conceive that [the plaintiff] might properly be classified as a minister of the Catholic faith when she is not even a member of that faith.” Further, “although her teaching contract required her to teach and act in accordance with the precepts of the Catholic Church and aid in the Christian formation of students, defendants have not articulated specific responsibilities or actions that might be considered ministerial …. [Her] position as a teacher of secular subjects [does not] qualify her for the ministerial exception. She did not teach religion or lead the students in prayer, and she is not Catholic.

age discrimination

The court rejected the plaintiff’s age discrimination claim on the basis of five performance-related incidents that formed the basis for nonrenewal of her teaching contract. Generally, if an employer in an employment discrimination case is able to articulate a nondiscriminatory reason for an adverse employment decision, the burden of proof shifts to the employee to prove that the employer’s reason was “pretextual.” An employee generally shows pretext with evidence that the employer’s stated reason for the adverse employment action was false. The court concluded that the plaintiff had failed to produce any evidence that the defendants’ nondiscriminatory basis for not renewing her contract was pretextual.

The court also noted that the school’s decision not to renew the plaintiff’s contract “benefits from a strong inference that the decision was not pretextual under the ‘same actor’ inference.” It explained: “Where the employee was hired and fired by the same person within a relatively short time span, there is a strong inference that the employer’s stated reason for acting against the employee is not pretextual …. The same actor inference has been applied when the hiring and firing occurred up to four years apart.” The court noted that the parish priest had signed some of the plaintiff’s recent contracts, and also made the final decision to terminate. Since these two acts were relatively close in proximity, a “strong inference” arose that the defendants’ nondiscriminatory reason for not renewing the contract was not pretextual.

What This Means For Churches:

This case is important for the following reasons:

1. Many church leaders are unaware that Title VII’s ban on religious discrimination in employment decisions applies to both religious and “secular” positions in a church. This court explicitly acknowledged that the church and school were allowed to discriminate on the basis of religion in terminating the plaintiff, even if her position as a teacher was deemed to be “secular.”

2. Title VII’s exemption of religious employers from the ban on religious discrimination in employment decisions applies 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.” The court provided an excellent nine-factor test to be used in deciding if an employer is a religious employer exempt from the ban on religious discrimination.

3. Only employers with at least 15 employees, and engaged in interstate commerce, are subject to Title VII. Most churches have fewer than 15 employees, and are not covered by Title VII. However, most states have enacted employment discrimination laws that are more likely to apply to churches since they have no interstate commerce requirement and often apply to employers with fewer than 15 employees.

4. The court applied the so-called “same actor” inference. This principle, which has been applied by many courts, raises an inference that if the same person makes an adverse employment decision soon after (up to four years, according to one court) a decision to hire the person, an allegedly nondiscriminatory reason for the adverse decision is not pretextual. This is an important inference for church leaders to bear in mind. However, note that the court cautioned that “the same actor evidence gives rise to an inference, rather than a presumption, that no discriminatory animus motivated the employer’s actions.” Braun v. St. Pius X Parish, 2011 WL 5086362 (N.D. Okla.2011).

This Recent Development first appeared in Church Law and Tax Report, September/October 2012.

Legal Developments

Discriminating Against Obese Employees

Court rules that severe obesity is a disability under the Americans with Disabilities Act.

Richard R. Hammar, Attorney, CPA
Bio

Church Law & Tax Report

Discriminating Against Obese Employees

Court rules that severe obesity is a disability under the Americans with Disabilities Act.

Richard R. Hammar, J.D., LL.M., CPA

Key point 8-14.1. The federal Americans with Disabilities Act prohibits employers with at least 15 employees, and that are engaged in interstate commerce, from discriminating in any employment decision against a qualified individual with a disability who is able, with or without reasonable accommodation from the employer, to perform the essential functions of the job. Accommodations that impose an undue hardship upon an employer are not required. Religious organizations may give preference to nondisabled members of their faith over disabled persons who are members of a different faith.

A federal district court in Louisiana ruled that severe obesity is a disability under the Americans with Disabilities Act. A 400-pound woman (the “plaintiff”) was hired to oversee a day care program for the children of mothers staying at a residential treatment facility for chemically dependent women and their children. Eight years later, the plaintiff was fired. At the time of her termination, she weighed 527 pounds. She filed a charge of discrimination with the Equal Employment Opportunity Commission (“EEOC”), alleging that she had been terminated because her employer regarded her as disabled due to her obesity. The plaintiff died shortly after filing her complaint with the EEOC. Her death certificate listed the cause of death as “morbid obesity.” Following her death, the plaintiff’s estate continued her claim of discrimination.

The EEOC concluded that the plaintiff had severe obesity, which is a physical impairment under the Americans with Disabilities Act (“ADA”) and that her employer regarded her as disabled because of it. As a result, the EEOC sued the employer, claiming that the plaintiff’s termination was a violation of the ADA.

The court began its opinion by noting that “to prevail on an ADA claim, the EEOC must demonstrate that: (1) there is a disability within the meaning of the ADA, (2) the complaining party is a qualified individual with a disability, and (3) the complaining party suffered an adverse employment decision because of the disability. The threshold inquiry is whether or not a plaintiff has a disability within the meaning of the ADA.”

Under the ADA, a disability is a physical or mental impairment that substantially limits one or more “major life activities.” An employee who is “regarded as having such an impairment” also meets the definition of “disabled,” whether disabled or not.

The court quoted from the EEOC’s ADA compliance manual:

[B]eing overweight, in and of itself, is not generally an impairment …. On the other hand, severe obesity, which has been defined as body weight more than 100% over the norm, is clearly an impairment. In addition, a person with obesity may have an underlying or resultant physiological disorder, such as hypertension or a thyroid disorder. A physiological disorder is an impairment.

The court concluded that “a careful reading of the EEOC guidelines and the ADA reveals that the requirement for a physiological cause is only required when a charging party’s weight is within the normal range. However, if an employee’s is outside the normal range—that is, if the charging party is severely obese—there is no explicit requirement that obesity be based on a physiological impairment.” The court noted that the plaintiff was severely obese; when she was hired she weighed in excess of 400 pounds, and when she was terminated, she weighed in excess of 500 pounds. In addition, she had multiple resulting disorders from her obesity, including diabetes, congestive heart failure, and hypertension.

The court concluded that the plaintiff was disabled, and that her employer violated the ADA by terminating her on account of her disability without any effort to reasonably accommodate her disability. In support of its decision, the court noted that, three months before her termination, she received a performance evaluation where she was rated as “excellent” in seven out of twelve areas, including “Quality of Work.”

What This Means For Churches:

This case should serve as notice to churches that are subject to the ADA, or a state counterpart, that morbidly obese employees may be regarded as disabled. This means that a church may be liable for taking any adverse employment action (i.e., termination) against a morbidly obese employee, and may have a legal obligation to “accommodate” such a person’s disability, so long as this would not impose an undue burden on the church. Our recommendation is that churches should not dismiss, demote, or take any other adverse employment action against morbidly obese employees without first consulting with legal counsel. E.E.O.C. v. Resources for Human Development, Inc., 2011 WL 6091560 (E.D. La. 2011).

This Recent Development first appeared in Church Law & Tax Report, July/August 2012.

Legal Developments

Who Is Considered a Minister?

Courts may use various tests to determine whether the ministerial exception applies to an individual.

Richard R. Hammar, Attorney, CPA
Bio

Church Law & Tax Report

Who Is Considered a Minister?

Courts may use various tests to determine whether the ministerial exception applies to an individual.

Richard R. Hammar, J.D., LL.M., CPA

Key point 8-10.1. The civil courts have consistently ruled that the First Amendment prevents the civil courts from applying employment laws to the relationship between a church and a minister.

A federal court in Texas ruled that the “ministerial exception” prevented it from resolving a church music director’s claim that his church’s decision to terminate his employment amounted to unlawful age and disability discrimination. An adult male (the “plaintiff”) was terminated from his position as a church’s music director. He sued the church and the governing diocese (the “defendants”), claiming that his dismissal violated federal laws prohibiting discrimination in employment on the basis of age and disability. The defendants asked the court to dismiss the case on the basis of the “ministerial exception” doctrine, which generally prohibits the civil courts from resolving employment disputes between churches and persons in ministerial positions.

In determining whether the ministerial exception applied to the plaintiff, the court noted the following facts:

In 2007 the plaintiff had knee replacement surgery, and was terminated a few months later.

The court concluded that the plaintiff was a “minister” for purposes of the ministerial exception, and therefore it was barred by the First Amendment from resolving his claims. It acknowledged that the courts “have not adopted a uniform general test” for deciding who is a minister. Some courts utilize the “primary duties” test, which asks whether the employee’s primary duties are religious in nature. Others use a version of the “primary duties” test, without adopting it. Others use a three-part test first announced in 1999 by a federal appeals court. Starkman v. Evans, 198 F.3d 173 (5th Cir. 1999). The so-called Starkman test identified three factors to consider in deciding if a church employee is a “minister” for purposes of the ministerial exception:

(1) Are employment decisions regarding the position at issue made “largely on religious criteria”?

(2) Is the employee authorized to perform the ceremonies of the church?

(3) “Probably most important is whether [plaintiff] engaged in activities traditionally considered ecclesiastical or religious.”

The Starkman court held that it is “sufficient” to deem an employee’s function “ministerial” if only the third prong is satisfied. It concluded that a church’s music director was a “minister” and therefore her lawsuit accusing her employing church of employment discrimination had to be dismissed.

The Texas court concluded that the plaintiff was a minister under the Starkman test. Its analysis of the three Starkman factors is summarized below.

1. employment decision made largely on religious criteria

The plaintiff insisted that he was merely a bookkeeper, sound person, custodian, and accompanist, and did not serve any ministerial or pastoral functions. He claimed that his position was entirely secular and that he did not have any special education or experience in liturgical music or liturgical norms.

The church defendants pointed to the plaintiff’s job description for evidence of religious criteria. The job description includes a “Brief Job Summary” that reads: “This position reports to the Pastor and is responsible for leading, coordinating, evaluating and guiding the Choirs, Cantors, Orchestra and instrumental musicians that participate in [church] liturgies except for the 5:30 Sunday evening Mass. This position has wide authority to exercise independent judgment and discretion within the scope of the job.” The “essential duties” described in the job description include producing high-quality liturgical music, and leadership for the church’s choirs and instrumental musicians, including rehearsals, preparation, and music selection. The job description further states that the job requires “knowledge of” liturgical procedures, a wide range of liturgically appropriate music, including Gregorian chant, and documents and teachings of the Catholic Church related to music ministry.

The court concluded that the evidence was too tenuous and conflicting to say that this factor supported ministerial status.

The court concluded that while the plaintiff “tries to downplay his liturgical responsibilities,” in fact “all of this evidence shows that he was qualified and authorized to perform ceremonies in the church.”

2. qualified and authorized to perform the ceremonies of the Church

The second Starkman factor addresses whether the plaintiff was qualified and authorized to perform ceremonies of the church. The court concluded that he was, despite his claim that he was merely an accompanist, sound man, and bookkeeper. The court noted that his own deposition “revealed that he was much more.” He testified that as music director he was responsible for the music at the Saturday night Mass, Sunday morning Masses, and for the choir … that at a typical Mass he would direct the choir in four hymns, one octavo, one psalm, the Lord’s Prayer, the Hallelujah, and the Kyrie; he picked the music for each Sunday from a list of prescribed hymns contained in certain books, id. at 126-129; picked the octavos performed by the choir during the Mass; determined who could perform at the Masses and what music they could perform; practiced with the choirs every Tuesday and taught them how to read music; hired various outside coaches to help with the choirs; organized who would perform as cantors at the services; hired replacement cantors and piano players for the times he went on vacation; and printed and chose content for the worship aids handed out at Masses.

The court concluded that while the plaintiff “tries to downplay his liturgical responsibilities,” in fact “all of this evidence shows that he was qualified and authorized to perform ceremonies in the church, and the second factor of the Starkman test is met here.”

3. engaged in activities traditionally considered ecclesiastical or religious

The third Starkman factor, most determinative in this case, is whether the plaintiff “engaged in activities traditionally considered ecclesiastical or religious.” The court concluded that they were. It quoted from the testimony of an expert in Canon Law:

Music enhances the liturgy and is not considered a performance …. In the Catholic Church, sacred music supports the church’s prayer by enriching its elements. A music director is integral to the Catholic Mass, including the celebration of the Liturgy of the Word and Liturgy of the Eucharist. The music director is also integral to the celebration of the other important religious ceremonies and sacraments of the Catholic Church …. A music director also serves the Church’s spiritual and pastoral missions by designing and implementing a music program through which the faithful are able to more appropriately worship God in the Mass, other liturgies, and prayerful events. Additionally, through music, the Music Director is to develop fellowship among the faithful. As such, the Music Director at the Church leads an important spiritual and religious fellowship for the Church that is essentially religious in nature. In conclusion, the Music Director, including [the plaintiff] is a worship leader of the Church.

The court concluded:

As Music Director, plaintiff’s responsibility was to lead and provide music for the Mass, including liturgical portions such as the Psalm and Kyrie. Plaintiff was not merely an accompanist and the evidence does not support that he believed this. He stated in a letter to a [deacon] that, “we rightly thought that by our labor we were helping to unfold the Creator’s work and contributing, by our personal industry, to the realization in history of the divine plan.” Plaintiff has presented no evidence that somebody else led the Choir at the Masses. Plaintiff’s claims that the choir led itself is without merit …. Moreover, even assuming he delegated some of his duties to others, Plaintiff was responsible for the final product presented to the congregation. His role as Music Director was ecclesiastical and spiritual.

The court concluded: “As music director, the plaintiff performed functions that are considered ecclesiastical or religious. He participated in religious rituals and played a spiritual leadership role at [the church]. His dismissal from his position as music director was painful for him and his family (who were also highly involved in the church), expressly because of the relationship between his position at the church and his spiritual beliefs. Accordingly, the ministerial exception applies and the plaintiff’s age and disability discrimination claims are barred.”

What This Means for Churches:

This case provides helpful guidance in the definition of the term “minister” for purposes of the ministerial exception. In 2012, the United States Supreme Court unanimously affirmed the ministerial exception, but declined to define the term “minister.” That is understandable, since it would be difficult to fashion a definition that would apply in all cases. The Supreme Court left the definition of this essential term to other courts in other cases.

The court in this case chose to apply the Starkman test. A minority of courts that have applied the ministerial exception have used this test. Many more courts have applied a definition that focuses on a person’s primary duties: “As a general rule, if the employee’s primary duties consist of teaching, spreading the faith, church governance, supervision of a religious order, or supervision or participation in religious ritual and worship, he or she should be considered ‘clergy.'” Rayburn v. General Conference of Seventh-day Adventists772 F.2d 1164 (4th Cir. 1985).

In many cases, both tests will produce similar results.

One other aspect of this case merits attention. The court placed great weight on the plaintiff’s job description. The importance of job descriptions in ministerial exception cases cannot be understated. Churches should review job descriptions, especially for non-ordained staff, to see if employees who might meet the definition of “minister” for purposes of the ministerial exception have job descriptions that highlight and stress their religious functions. Catholic Diocese, 2011 WL 4352771 (W.D. Tex. 2011).

This Recent Development first appeared in Church Law and Tax Report, May/June 2012.

Legal Developments

Overtime Pay for Work-Related Smartphone Use

Follow these steps to reduce your risk of overtime liability.

Richard R. Hammar, Attorney, CPA
Bio

Key point 8-08.6. The Fair Labor Standards Act exempts employees employed in an executive, administrative, or professional capacity from the minimum wage and overtime pay provisions. To be covered by one of these exemptions, an employee must perform specified duties, and be paid a salary in excess of a specified amount.

A federal court in Illinois refused to dismiss a lawsuit claiming that the City of Chicago violated the Fair Labor Standards Act by failing to pay police officers overtime pay for the use of smartphones for work-related business during nonworking hours.

A Chicago police sergeant (the "plaintiff") sued the City of Chicago on behalf of himself and all other employees of the Chicago Police Department against the City of Chicago, alleging that the City violated the Fair Labor Standards Act ("FLSA") by failing to pay plaintiffs all the compensation they were due.

The plaintiff claimed that, at various points in the last three years, he and other employees of the police department were issued personal data assistants ("PDAs") or other electronic communication devices. He further alleged that:

The plaintiff sought monetary damages in the form of overtime compensation equal to the unpaid compensation and overtime compensation due all police department employees, plus interest, and reasonable attorney's fees, costs, and expenses.

The city asked the court to dismiss the lawsuit for failure to state a claim upon which relief could be granted. The court declined to do so, noting that the plaintiff's claim had sufficient merit to proceed to trial. The court acknowledged that "de minimis" (i.e., minimal) compensable time is "not recoverable under the FLSA." It referred to a federal regulation that states: "In recording working time under the Act, insubstantial or insignificant periods of time beyond the scheduled working hours, which cannot as a practical administrative matter be precisely recorded for payroll purposes, may be disregarded." 29 C.F.R. § 785.47.

This rule applies to "uncertain and indefinite periods of time involving a few seconds or minutes duration."

The city also argued that plaintiff failed to allege the amount of time he spent off duty, beyond a de minimis amount, responding to PDA communications that required his immediate response. The court responded: "Whether the amount of time plaintiff worked off the clock is greater than a de minimis amount, however, is a matter of the proof of his claim, not a matter of the sufficiency and plausibility of his complaint. We are mindful that some courts have required more detailed allegations as to the type and amount of work that allegedly earned FLSA overtime compensation …. [But] the elements that must be shown are simply a failure to pay overtime compensation … and failure to keep payroll records in accordance with the Act."

The court concluded:

The plaintiff pleaded that he was entitled to overtime pay because he "routinely and regularly" responded to phone calls, e-mails and work orders off the clock, as expected by the police department. He further has alleged that he was not paid for the excess hours worked, and that the city failed to keep appropriate records. These allegations of FLSA violations are plausible, and they give the city adequate notice of the claim. Whether plaintiff can prove what he has plead remains to be seen after discovery.

What This Means For Churches

This is the first case that we have seen to address employer liability for overtime based on employees' use of cell phones during non-working hours for business purposes. This court suggested that liability may arise, so long as the cell phone use is documentable and not "de minimis." The case now proceeds to trial, unless it is settled. Future developments regarding this and similar cases will be addressed in future editions of Church Law & Tax Report. For now, church leaders should consider some obvious steps to reduce this potential risk of an overtime pay liability:

  1. Only issue cell phones to employees who clearly satisfy the definition of "exempt employees" under the FLSA. Exempt employees include administrative, executive, and professional employees. Ministers generally are considered professional employees. See sections 8-08.5 and 8-08.6 in Richard Hammar's Pastor, Church & Law (4th ed. 2008) for a full explanation of these exemptions.
  2. If you currently issue cell phones to non-exempt employees, review each case to determine if there is a legitimate business need to do so.
  3. If you determine that a legitimate business need exists for issuing cell phones to one or more non-exempt employees, then require these employees to keep accurate records of their business use of the device that should be cross-checked against the church's monthly cell phone bills for confirmation. The employer has a duty under the FLSA to maintain these records. Obviously, this is going to be an administrative burden for the church that may prompt a reconsideration of which employees really need a church-provided cell phone.
  4. If you determine that a legitimate business need exists for issuing cell phones to one or more non-exempt employees, then consider a policy that requires these employees to leave their church-provided cell phones in their church office during non-working hours. Allen v. City of Chicago, 2011 WL 941383 (N.D. Ill. 2011).

    5. Employment Practices

    See (1) "Compensation," Allen v. City of Chicago, 2011 WL 941383 (N.D. Ill. 2011), and (2) "Minimum wage and overtime pay," Alcazar v. Corporation of the Catholic Archbishop, 627 F.3d 1288 (9th Cir. 2010), and (3) "Privacy," Duncan v. Peterson, 947 N.E.2d 305 (Ill. App. 2010), in the Legal Developments section of this website.

    Fair Labor Standards Act

    See "Minimum wage and overtime pay," Alcazar v. Corporation of the Catholic Archbishop, 627 F.3d 1288 (9th Cir. 2010), in the Legal Developments section of this website.

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