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Application to Religious Organizations

§ 8.12.01
Key Point 8-12.01. 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.

Title VII, section 702, of the Civil Rights Act of 1964 states:

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

This provision permits religious corporations, associations, and educational institutions to discriminate on the basis of religion in the employment of any person for any position.

As originally enacted, section 702 permitted religious employers to discriminate on the basis of religion only in employment decisions pertaining to their "religious activities." Congress amended section 702 in 1972 to enable religious organizations to discriminate on the basis of religion in all employment decisions. In the years following the 1972 amendment, a number of federal courts suggested that the amendment violated the First Amendment's nonestablishment of religion clause. To illustrate, one court characterized the amendment as "a remarkably clumsy accommodation of religious freedom with the compelling interests of the state, providing … far too broad a shield for the secular activities of religiously affiliated entities with not the remotest claim to First Amendment protection. …"[87] Equal Employment Opportunity Commission v. Southwestern Baptist Theological Seminary, 485 F. Supp. 255, 260 (N.D. Tex. 1980), rev'd on other grounds, 651 F.2d 277 (5th Cir. 1981), cert. denied, 102 S. Ct. 1749 (1982). See also Feldstein v. Christian Science Monitor, 555 F. Supp. 974 (D. Mass. 1983) (Christian Science Monitor held to be a religious activity of the First Church of Christ, Scientist, a religious organization, and thus it could discriminate in em-ployment decisions on the basis of religion). The court conceded that it would be unconstitutional to prohibit religious organizations from discriminating on the basis of religion in employment decisions pertaining to religious activities, but it concluded that allowing religious organizations to discriminate on the basis of religion in any employment decision went too far. Other courts reached the same result.[88] See, e.g., King's Garden, Inc. v. Federal Communications Commission, 498 F.2d 51 (D.C. Cir. 1974), cert. denied, 419 U.S. 996 (1974). But cf. Equal Employment Opportunity Commission v. Southwestern Baptist Theological Seminary, 651 F.2d 277 (5th Cir. 1981); Equal Employment Opportunity Commission v. Mississippi College, 626 F.2d 477 (5th Cir. 1980), cert. denied, 453 U.S. 912 (1981); Ritter v. Mount St. Mary's College, 495 F. Supp. 724 (D. Md. 1980).

In 1987, the United States Supreme Court resolved the controversy concerning the legal validity of section 702 by ruling unanimously that it did not violate the First Amendment's nonestablishment of religion clause.[89] Corporation of the Presiding Bishop of the Church of Jesus Christ of Latter-Day Saints v. Amos, 483 U.S. 327 (1987). The case involved a maintenance employee of a Mormon church-affiliated gymnasium in Salt Lake City, Utah, who was fired because he failed to comply with the church's standards regarding church attendance, tithing, and abstinence from coffee, tea, alcohol, and tobacco. The employee sued the church, alleging that his dismissal violated the ban on religious discrimination in employment decisions contained in Title VII of the Civil Rights Act of 1964. The church asserted that the exception contained in section 702 of the Act permitted it to discriminate in any employment decision on the basis of religion. The employee countered by claiming that the exception violated the First Amendment's ban on the establishment of a religion. A federal district court agreed with the employee, and ordered the employee reinstated with back pay. The church appealed directly to the Supreme Court.

The Supreme Court began its opinion by emphasizing that "there is ample room under the establishment clause for benevolent neutrality which will permit religious exercise to exist without sponsorship and without interference." It evaluated the constitutionality of the section 702 exemption on the basis of a three-part test it devised in 1971 (but which was later overturned through a 2022 ruling). Under this test, a law challenged on the basis of the nonestablishment of religion clause is permissible only if it satisfies three requirements—(1) it has a clearly secular purpose, (2) its primary effect is neither the advancement nor the inhibition of religion, and (3) it does not result in an excessive entanglement between church and state (learn more about the legal standard now used for determining Establishment Clause cases in Chapter 12).[90] Lemon v. Kurtzman, 403 U.S. 602 (1971). The Court concluded that "the exemption involved here is in no way questionable" under the three-part test. The section 702 exemption met the first part of the test since "under the Lemon analysis, it is a permissible legislative purpose to alleviate significant governmental interference with the ability of religious organizations to define and carry out their religious missions." In concluding that the section 702 exemption met the second part of the test, the Court observed that

undoubtedly, religious organizations are better able now to advance their purposes than they were prior to the 1972 amendment to section 702. But religious groups have been better able to advance their purposes on account of many laws that have passed constitutional muster: for example, the property tax exemption. … A law is not unconstitutional simply because it allows churches to advance religion, which is their very purpose. For a law to [have the primary effect of advancing religion] it must be fair to say that the government itself has advanced religion through its own activities and influence.

The Court also concluded that the section 702 exemption did not result in an excessive entanglement between church and state. On the contrary, "the statute effectuates a more complete separation of the two and avoids … intrusive inquiry into religious belief. …"

In responding to the dismissed employee's claim that section 702 provided adequate protection to religious employers prior to its amendment in 1972, the Court observed:

[The dismissed employee argues] that … section 702 provided adequate protection for religious employers prior to the 1972 amendment, when it exempted only the religious activities of such employers from the statutory ban on religious discrimination. We may assume for the sake of argument that the pre-1972 exemption was adequate in the sense that the free exercise [of religion] clause required no more. Nonetheless, it is a significant burden on a religious organization to require it, on pain of substantial liability, to predict which of its activities a secular court will consider religious. The line is hardly a bright one, and an organization might understandably be concerned that a judge would not understand its religious tenets and sense of mission. Fear of potential liability might affect the way an organization carried out what it understood to be its religious mission.[91] Id. at 335-336. The Court noted that the present case illustrated the difficulties of distinguishing between "religious" and "secular" positions. The church maintained that the dismissed maintenance worker was engaged in a religious position, while the district court concluded that the position was entirely secular.

Religious organizations that are subject to Title VII are exempt only from the ban on religious discrimination in employment. They remain subject to Title VII's ban on employment discrimination based on race, color, national origin, or sex—except, as noted above, with respect to employment decisions involving clergy.

Case study. Religious organizations subject to Title VII are exempt from the ban on religious discrimination in employment, but they remain subject to the ban on employment discrimination based on race, color, national origin, or gender. However, not every allegation of discrimination has merit. To illustrate, a federal court in Pennsylvania ruled that a female employee of a Lutheran synod was not a victim of sex discrimination when her position was eliminated due to the merger of her synod with other synods. It observed: "[T]he 1984 decision of the three national Lutheran churches to merge had a significant impact on the future needs and direction of the Synod. Reflecting on these material changes, and their potential impact on the Synod's operational needs, the executive board of the Synod concluded that the coordinator of planning and communications position held by [the female employee] was expendable. While one may lament the fact that business principles and methods (e.g., budgets, income statements and time reports) have crept into our religious organizations, and regret the economic and personal pain that such bottom-line orientation caused the [dismissed employee] in this case, this hand-wringing will not create a cause of action [for sex discrimination] where none exists."[92] Yost v. Western Pennsylvania-West Virginia Synod of the Lutheran Church in America, Inc., 789 F. Supp. 191 (W.D. Pa. 1992).
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