Employment laws of employees of religious institutions is a fact intensive inquiry

Most everyone knows that nonprofit religious organizations are not treated the same as other entities with respect to some laws. For example, discrimination based on religion: Religious institutions are permitted to discriminate on the basis of religion. If it were otherwise, it would be an infringement on freedom of religious belief and practice. In California, the Legislature has specifically exempted "[a] religious association or religious corporation not organized for private profit" from its definition of "employer" for purposes of the California Fair Employment and Housing Act. What religious employers in California sometimes do not fully appreciate is that there are many other sources of employment law in California besides the Fair Employment and Housing Act. For example, the California Labor Code sets forth many requirements that apply to all employers in California.

In March, a legal battle ensued between the California Labor Commission and the Stephen S. Wise Temple in Los Angeles County over employment rights for teachers at the Temple's religious schools. The case, brought by Labor Commissioner Julie Su on behalf of the temple's teachers, sought to provide preschool teachers with the right to rest breaks, uninterrupted meal breaks, and overtime pay. The temple disputed that its teachers were entitled to these standard employment rights available to employees under the Labor Code. The temple argued that the "ministerial exception," applied and that through that exception, religious entities have a constitutional right to treat "ministers" differently than normal employees. The labor commissioner disagreed and argued that preschool teachers do not qualify as ministers, nor were they required to adhere to the same standards of ministers within the temple. The labor commissioner argued that the temple's teachers were simply teachers in a school that happened to be religious, they were not "religious ministers." In other words, absent some additional evidence supporting a ministerial role, there is no rule that everyone who works for a religious entity is a minister.

The temple is one of the largest Jewish congregations in the country, situated in the picturesque Bel Air neighborhood of Los Angeles California. As with many large churches, synagogues and mosques, the temple also runs an early childhood center, employing 40 preschool teachers, who teach both secular and religious content to children five and younger. Teachers at the temple were not required to study theology, be ordained as religious leaders, or even be practitioners of the Jewish faith. These facts were seemingly important to the labor commissioner's determination that the teachers were not ministers.

The First Amendment of the Constitution prohibits laws that interfere with the free exercise of religion. The ministerial exemption was firmly solidified in legal precedent by the Hosanna-Tabor Evangelical v. EEOC, 565 U.S. 171 (2012), case in which the U.S. Supreme Court upheld the rights to use the ministerial exception to avoid constitutional violations in employment discrimination cases. The Supreme Court held that religious institutions should not be subject to Equal Employment Opportunity Commission rules lest they violate the organization's First Amendment rights. That makes sense. A religion cannot operate without undue governmental influence if it is not permitted to use its own discretion in appointing ministers to lead it in manners of belief and worship. Unfortunately, the Supreme Court did not establish a solid and concrete methodology for deciding when an employee qualifies as a minister and when he or she does not. As often happens, the Supreme Court left it to the lower courts to decide on a case-by-case basis.

The outcome in the Stephen S. Wise Temple case also makes sense. Although it is hypothetically conceivable, it is difficult to imagine a good First Amendment reason to exempt a religious institution from neutral laws of employee fairness such as minimum wage, overtime, and meal and rest breaks for nonexempt employees. While the court in the temple's case did not address exactly how the ministerial exception applies to California's wage-and-hour laws, it did decide that the temple was not able to prove its preschool teachers are exempt as ministers. Although there is no black-and-white test for religious employers to follow, the best practice for religious employers is to assume that wage and hour laws apply to all employees unless the employee is indisputably in a spiritual and ministerial role.