The Fifth Circuit Court of Appeals (the “Fifth Circuit”) rendered a significant decision recently in Braidwood Management, Inc. v. Equal Employment Opportunity Commission. This decision has garnered attention and sparked discussions due to its potential implications for religious freedom, employment law and the rights of individuals in the workplace.
Background
In Braidwood, the plaintiff was a for-profit management company that employed workers of various health care entities. Braidwood identifies itself as a “Christian business” and adheres to certain practices. As part of its policies, the company does not allow the employment of individuals it deems “sexually immoral or gender non-conforming.” Additionally, Braidwood implements a specific dress code for individuals based on their biological sex, and their employees are expected to use restrooms corresponding to their biological sex. The company brought suit on behalf of itself and others similarly situated against the Equal Employment Opportunity Commission (“EEOC”), seeking declaratory judgments that Title VII violated the Free-Exercise Clause of the First Amendment and the Religious Freedom Restoration Act (“RFRA”). Moreover, the company also requested declaratory judgments that Title VII, as interpreted by the recent U.S. Supreme Court decision in Bostock v. Clayton County, does not prohibit discrimination against bisexual employees and allows employers to establish sex-neutral rules of conduct that exclude gay, lesbian and transgender employees from employment.
Title VII prohibits employers from discriminating based on an individual’s sex with regard to compensation, terms, conditions or privileges of employment. It also prohibits any practices that adversely affect employment opportunities based on sex.
The heart of this lawsuit revolves around the aforementioned Supreme Court judgment in Bostock. In Bostock, the Supreme Court ruled that discrimination on the basis of sexual orientation or transgender status qualifies as discrimination “because of sex” under Title VII. The Supreme Court in Bostock explained that if an employer dismisses an employee for conduct, but would allow in a member of the opposite biological sex, it makes sex the “but-for cause” of the termination, thus violating Title VII. While the Supreme Court did not explicitly address the RFRA’s relationship to Title VII, it acknowledged that “because RFRA operates as a kind of super statute…it might supersede Title VII’s commands in appropriate cases.” As the Fifth Circuit reiterated, there remain three potential avenues of recourse for religious and faith-based employers: (1) Title VII’s religious exception contained in 42 U.S.C. § 2000e–1(a); (2) the ministerial exception; and (3) the RFRA.
RFRA and Title VII
The RFRA prohibits the federal government and states from “substantially burdening a person’s free exercise of religion” unless “application of the burden is in furtherance of a compelling governmental interest and is the least restrictive means of furthering that interest.” Notably, the Fifth Circuit referred to Little Sisters of the Poor Saints Peter & Paul Home v. Pennsylvania, in which the Supreme Court held that “the government must accept the sincerely held…objections of religious entities.”
Braidwood argued that Title VII substantially burdened its religious practices, as it held beliefs that “heterosexual marriage is the only form of marriage sanctioned by God”, “premarital sex is wrong”, and “men and women are to dress and behave in accordance with distinct and God-ordained, biological sexual identity.” The Fifth Circuit, in an opinion rendered by the Hon. Jerry E. Smith, ruled that compelling Braidwood to employ individuals whose behavior contradicts the company owner’s beliefs “would substantially burden its ability to operate per its religious beliefs about homosexual and transgender conduct.”
In evaluating whether the EEOC established that its interpretation of Title VII furthers a compelling governmental interest, the Fifth Circuit applied the strict scrutiny test. Citing Supreme Court precedent, the Fifth Circuit noted that this is the “most demanding test known to constitutional law.” The Fifth Circuit concluded that the EEOC had failed to meet its burden. Furthermore, even if the Court accepted the EEOC’s compelling interest argument, it found that refusing to exempt Braidwood and forcing it to hire and endorse the views of these employees “is not the least restrictive means” of promoting that interest. Thus, the Fifth Circuit largely affirmed the decision of the district court and held that Braidwood, as a religious entity, is exempt from the requirements of Title VII as interpreted by the Supreme Court in Bostock because it would be a substantial burden on the company owner’s free exercise of religion.
The Fifth Circuit declined to address whether Title VII prohibits discrimination against bisexual employees or whether Title VII allows employers to establish sex-neutral rules of conduct that exclude gay, lesbian and transgender people from employment.
Practical Takeaways
In the Braidwood decision, the Fifth Circuit recognized that a for-profit religious employer may be exempt from the obligations of Title VII concerning their employees’ sexual orientation or gender identity, provided it can be demonstrated that these requirements impose a significant burden on the employer’s religious beliefs.
Though religious employers – at least in the Fifth Circuit – may be able to assert a defense against the enforcement of Title VII based on religious liberty, the Braidwood decision does not afford all religious employers the right to implement or enforce policies that conflict with obligations of Title VII regarding sexual orientation and gender identity. Further, any employer considering such a defense should certainly consult with counsel, as other courts may disagree or apply the Braidwood holding differently.
If you have any questions or would like more information on this decision or its implications for your organization, please contact:
- Jon Rabin at (248) 457-7835 or jrabin@hallrender.com; or
- Your primary Hall Render contact.
Special thanks to Ahmad Beydoun, Summer Associate, for his assistance in preparing this article.
Hall Render blog posts and articles are intended for informational purposes only. For ethical reasons, Hall Render attorneys cannot—outside of an attorney-client relationship—answer an individual’s questions that may constitute legal advice.
