Will The Contraception Mandate Be Sacrificed In The Name Of Corporate Religion?

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On Tuesday, the United States Supreme Court heard oral arguments in Sebelius v. Hobby Lobby Inc., and the stakes are high — whether or not you use contraceptives. At issue will be whether the ACA violates the First Amendment right to freedom of religion, by requiring corporations to comply with provisions that run counter to the religious beliefs of controlling corporate shareholders. In other words, can a company itself have “sincerely held religious beliefs,” and is the court willing to recognize and define corporate religion?

Here’s the ironic part about Hobby Lobby’s challenge to the contraception mandate: According to Slate, the company was already doing 80 percent of what’s legally required before it sued the government in 2012. In fact, as Justice Sotomayor noted, after the ACA passed, the Greens actually changed company policy to drop the contraceptives it had been covering:

Hobby Lobby is owned and operated by David and Barbara Green and their three children. They employ 13,000 workers. Hobby Lobby covers the range of most FDA-approved devices, but because they believe Ella, Plan B, and two types of IUDs cause abortions, they don’t want to cover those four. Conestoga is owned by a Mennonite family that objects to covering Ella and Plan B but not the other methods.

Regarding religious freedom, the First Amendment to the U.S. constitution simply says: “Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof…” Nevertheless, the justices may decide that the 1993 Religious Freedom Restoration Act (RFRA), which prevents laws that substantially burden a person’s free exercise of their religion, should be favorably applied to the aggrieved companies in the ACA contraception cases. Yesterday though, Kagan highlighted several weaknesses of this application:

Kagan responds, “So one religious group could opt out of this and another religious group could opt out of that and nothing would be uniform.” And Ginsburg points out that the reason RFRA passed with such broad, bipartisan support was that Congress took out a proposed amendment that “would have enabled secular employers and insurance providers to deny coverage on the basis of religious beliefs or moral convictions.” Au contraire, says Clement. RFRA passed broadly because it afforded such broad protections.

Kagan’s not buying it: “Your interpretation of [RFRA] would essentially subject the entire U.S. Code to the highest test in constitutional law, to a compelling interest standard” and allow employer after employer to voice religious objections to sex discrimination laws and minimum wage laws and family leave and child labor laws. All of which would be subject to what she describes as this “unbelievably high test, the compelling interest standard.” Employers will, under that standard, virtually all win.

Unless it finds a way out, the Roberts Court will slide further down the slippery slope created by Citizens United. Should the justices continue application of the Bill of Rights to the legally fictitious “persons” that are incorporated entities, where will it end? Justice Sotomayor pressed the plaintiff’s representation on the difficulties of defining a corporation’s religious sincerity:

Clement pivots to explain why corporations can be “persons” under the Dictionary Act and Sotomayor presses him on how “a corporation can exercise religion.” She asks, “Who determines the corporate religion? The majority of shareholders? The corporate officers? Is it 51 percent?”

Clement replies that “this line of questioning goes to a question of sincerity, and if some large corporation asserts some claim that’s going to save them lots of money, I would think that the government in those kind of cases is really going to resist the sincerity piece of the analysis.” Sotomayor replies that courts aren’t supposed to be in the business of testing religious sincerity in the first place.

David and Barbara Green, owners of Hobby Lobby, say their company could face as much as $475 million in penalties if they don’t provide full coverage of contraception, which violates their religious beliefs. A second company, Conestoga Wood Specialties Corp., a Mennonite family–owned company that makes wooden door and cabinet parts, claims it could face $35 million in penalties. But what about the rights of employees who would suffer as a result of denied coverage? Justices Kennedy and Kagan addressed this neglected angle of the case:

Finally, Kennedy sets liberal hearts aflutter when he asks earnestly about the rights of employees and how the employer can “put the employee in a disadvantageous position.” He wonders: “The employee may not agree with these religious beliefs of the employer. Does the religious beliefs just trump?” Kagan puts it more starkly: “Congress has given a statutory entitlement to women and that includes contraception. And when the employer says no, that woman is quite directly, quite tangibly harmed.”

On the other hand, Justice Scalia downplayed the case’s implications for employees, arguing that there is nothing in the text of the Religious Freedom Restoration Act instructing the courts to worry about burdening “third parties”:

“If they wanted you to balance the interest of the religious objector against the interest of other individuals, they made no reference to that in RFRA at all.” Then Scalia introduces the argument that may carry the day for the religious objectors: that the government can’t have a compelling interest in providing contraception because it already made so many exemptions for so many classes of employers. Kennedy is particularly overwrought that it was an agency (the Department of Health and Human Services) and not Congress that offered all those exemptions.

If the Court rules in favor of Hobby Lobby and/or Conestoga, it could have significant consequences for employees, shareholders, and minorities:

The rights of millions of women to preventive healthcare and workplace equality elicit almost no sign of sympathy or solicitude from the right wing of the bench today. Nor does the possibility that religious conscience objections may soon swallow up the civil rights laws protecting gay workers, women, and other minorities. Religious freedom trumps because we’re “only” talking about birth control.

About Charley Moore

Charley is the Publisher of Article 3, as well as Founder and CEO of Rocket Lawyer Incorporated. Prior to founding Rocket Lawyer, Charley advised early stage companies, large enterprises and their investors on strategic partnering and corporate development strategy. Charley has been at the forefront of Internet corporate development since beginning his career as an attorney at Venture Law Group in Menlo Park, California in 1996. He represented Yahoo! (IPO), WebTV Networks (acquired by Microsoft) and Cerent Corporation (acquired by Cisco Systems) at critical early stages of their success and was the founder of Onstation Corporation. Charley graduated from the United States Naval Academy (BS), San Francisco State University (MS) and the University of California at Berkeley (Juris Doctorate). He served as a U.S. Naval officer and is a Gulf War veteran.
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