Do corporations have religious freedom?

Jan 24, 2014

Inside the First Amendment — Jan. 23, 2014

Do corporations have religious freedom?
By Charles C. Haynes

     If you thought Citizens United — the 2010 Supreme Court decision upholding free speech rights for corporations — was controversial, you haven’t seen anything yet.

     In March, the high court will hear arguments in two linked cases —Sebelius v. Hobby Lobby Stores, Inc. and Conestoga Wood Specialties Corp. v. Sebelius — that will require the justices to determine whether corporations have religious freedom rights under the First Amendment. 

     At first blush, corporate religious freedom may strike many people as absurd. After all, as one judge put it, corporations “don’t pray, worship or observe sacraments.”

     But like most First Amendment conundrums, the questions raised by religious freedom claims from private businesses are complicated and contentious — and the answers will have profound implications for defining the future of religious liberty in America.

     Both cases before the Supreme Court involve challenges to a provision of the Affordable Care Act requiring for-profit businesses to provide coverage for contraception in health insurance plans.

     Hobby Lobby and Conestoga Wood are private companies owned by deeply religious families — evangelical and Mennonite respectively — who believe that life begins at conception. On grounds of religious conscience, they cannot offer employees insurance plans that cover certain types of birth control (e.g., the “morning after” pill). Refusal to do so, however, subjects them to millions of dollars in fines.

     Both corporations sued on the grounds that the contraception mandate violates their free exercise of religion under the First Amendment and the Religious Freedom Restoration Act (a law passed by Congress in 1993 to “restore” free exercise protections that many believed the Supreme Court had unduly restricted in a 1990 decision, Employment Division v. Smith).

     The threshold question for the justices is whether these businesses have standing to make a religious freedom claim.

     Does the First Amendment’s Free Exercise clause apply to for-profit corporations, and, if so, are such corporations “persons” for purposes of the Religious Freedom Restoration Act (RFRA)?

     Appellate courts have given conflicting answers. According to the U.S. Court of Appeals for the 10th Circuit, companies like Hobby Lobby may assert free exercise claims. But the U.S. Court of Appeals for the 3rd Circuit reached the opposite conclusion, ruling, “a for-profit, secular corporation cannot engage in the exercise of religion.”

     Corporations, of course, are often treated as “persons” for legal purposes. And non-profit religious corporations — congregations, parishes, charities and the like — have long been able to assert religious freedom claims under the First Amendment. But until now, the Supreme Court has never considered whether for-profit corporations have religious freedom rights.

     The answer, I would argue, should not turn on the “profit” versus “non-profit” distinction, but rather on the principles and policies that guide the operation of the business.

     Hobby Lobby, for example, commits to “honoring the Lord in all we do by operating the company in a manner consistent with Biblical principles.” And Conestoga Wood is operated entirely by a family of devout Mennonites who “integrate their faith into their daily lives, including their work,” according to court documents.

     It should not be difficult to determine when corporations have policies that articulate a commitment to religious principles and practices that seek to apply those principles. Few corporations would qualify, but those that do should have corporate free-exercise rights.

     Making money, in and of itself, shouldn’t define a business as “secular.” Religious people should be free to enter the world of business without giving up their right to religious freedom — as long as the business they run is clearly committed to their religious principles and objectives.

     Recognition of free-exercise rights for these and similar companies would not, however, settle the question of whether these corporations are entitled to an exemption from the contraception mandate. But it would require the government to apply RFRA by demonstrating a compelling state interest — and no less restrictive way of achieving that interest — before denying the exemption.

     With all the complications corporate religious freedom may bring — finding alternative ways to provide contraception coverage, for example, if Hobby Lobby and Conestoga win an exemption under RFRA — the benefits to a free society far outweigh the costs.

     When people of faith chose to live out that faith in the world of business, they should not be put to what the Supreme Court once called “the cruel choice” between following their God and making a profit.