Catholic Charities Bureau v. Wisconsin Labor & Industry Review Commission

Fulfilling the Catholic Church’s religious mission 

Catholic dioceses across the country organize their efforts to meet the needs of the disadvantaged within the local community through Catholic charities and other similar entities. Since 1917, Catholic Charities has fulfilled this mission for the Diocese of Superior in northern Wisconsin, providing a wide range of services to help the disabled, the elderly, and the poor throughout the Diocese. Catholic Charities’ mission, consistent with their Catholic faith, is to serve all those in need, regardless of their religious beliefs. Accordingly, each year Catholic Charities ministers to thousands of individuals and families in need by offering in-home healthcare, housing for the elderly and disabled, childcare services, employment opportunities, and other vital resources.  

Wisconsin court of appeals denies Catholic Charities’ religious mission 

Wisconsin’s unemployment insurance program provides financial assistance to those who have lost their job through no fault of their own. Under state law, certain nonprofit organizations in Wisconsin can opt out of the program, including those operated primarily for religious purposes.  

Catholic Charities requested an exemption from the state’s unemployment program so that they could enroll in the Wisconsin Bishops’ Church Unemployment Pay Program (CUPP), a more efficient unemployment compensation program that provides the same level of benefits as the State’s program. 

In ruling that Catholic Charities did not qualify for a religious exemption from the State’s unemployment compensation program, the Wisconsin court of appeals both misinterpreted state law and violated the First Amendment. The court of appeals’ decision essentially cuts Catholic Charities off from the Diocese of Superior, concluding that the clear religious purpose of the Catholic Church and the Diocese in setting up and running Catholic Charities is irrelevant. Instead, the court of appeals concluded that Catholic Charities—looked at in isolation—was engaged in merely “charitable” (not religious) activities. The court thus denied Catholic Charities the exemption, forcing them to remain in the state’s less efficient unemployment compensation program.  

State law and the U.S. Constitution confirm that Catholic Charities’ mission is religious 

The Wisconsin court of appeals’ decision is deeply problematic. By separating Catholic Charities from the Diocese, the court ignored the Catholic Church’s determination regarding how to structure their own religious ministry. By concluding that Catholic Charities’ activities are not religious because Catholic Charities serves all those in need and doesn’t proselytize, the court penalized faiths that make caring for those in need—regardless of their religious background—a religious obligation. And, by engaging in a standardless inquiry to determine “how religious” Catholic Charities and their subsidiary ministries are, the court of appeals entangled secular courts in deeply religious questions, violating the separation of church and state.  

This outcome was wholly avoidable. Wisconsin’s unemployment compensation statute, Wisconsin’s Constitution, and the U.S. Constitution all require that courts look to the undisputed religious purpose of the Diocese of Superior when determining whether Catholic Charities qualifies for a religious exemption from the State’s unemployment compensation program.   

On April 18, 2023, the Wisconsin Supreme Court agreed to review the lower court’s decision. Oral argument took place in Madison on September 11, 2023. On March 14, 2024, the Justices affirmed the lower court and held that Catholic Charities’ ministry to the poor and needy was not religious. Catholic Charities plans to appeal the decision to the U.S. Supreme Court. 

Importance to Religious Liberty: 

Religious Communities: Religious communities have a right to serve those in need according to the dictates of their faith. Unfortunately, religious institutions are often targeted if not in alliance with societal standards.

Hedican v. Walmart

Sabbath day observance, a pillar of faith 

Sabbath day observance is a crucial part of many faiths—a day ordained by God when one abstains from the distractions of daily life in order to devote time to family, community, and worshiping God. As their name indicates, this practice is particularly sacred to Seventh-day Adventists, who observe the Sabbath from Friday at sundown to Saturday at sundown. Many employers voluntarily make allowances for Sabbath day observance, recognizing its essential role in the wellbeing of their religious employees. 

In April of 2016, Ed Hedican was offered a position as an assistant manager at Walmart. When he accepted the position, he requested a religious accommodation so that he would not have to work on the Seventh-day Adventist Sabbath. Though he asked not to be scheduled from on his Sabbath, he was willing to work any other time of the week, including Saturday after sundown.  

A corporation’s disregard for religious rights 

In response to Mr. Hedican’s request, Walmart refused to provide religious accommodation for the Sabbath and rescinded his job offer. Although Mr. Hedican was qualified for the position, and eager to work with Walmart to achieve a compromise (volunteering to work any other day of the week, including nights, and 12-hour shifts), Walmart refused, suggesting he apply to an hourly position of lower pay and lower rank. Though it is the largest non-governmental employer in the United States, Walmart claimed that any accommodation made for Mr. Hedican’s Sabbath observance would burden impose “undue hardship” on the company. 

The average salary of a Walmart assistant manager is just over $50,000. In contrast, Walmart—the largest private employer in the United States—amassed over half a trillion dollars in revenue in 2020 alone, making any cost or inconvenience of religious accommodation in this instance negligible. Yet Walmart even declined to investigate whether costless accommodations were available, such as allowing assistant managers (there were eight at this particular store) to arrange voluntary shift swaps amongst themselves.  

Title VII of the Civil Rights Act protects employees from discrimination due to factors such as religion, race, and gender. Mr. Hedican submitted a charge of discrimination to the EEOC, explaining that Walmart was not reasonably accommodating his religious exercise, as is required by law.  

Correcting a harmful precedent 

In the EEOC’s subsequent suit against Walmart, the federal trial and appellate courts ruled for Walmart, relying heavily on an old Supreme Court precedent from 1977. In Trans World Airlines v. Hardison, the Court ruled that companies may refuse to provide religious accommodation for their employees if providing such an accommodation presents the company with even a minor inconvenience.   

The U.S. Court of Appeals for the Seventh Circuit interpreted that precedent to mean that even a chance that shift-swaps would burden Walmart’s rotation system, without concrete evidence, was enough to rule for Walmart. This rule enables corporations like Walmart, the largest employer in the U.S., to discriminate against religious employees if accommodating them would cause a burden as trivial as rearranging work shifts.  

On behalf of Mr. Hedican, Becket asked the Court to revisit the Trans World Airlines decision and its interpretation in the lower courts, and defend the constitutional right of every American, including shift workers like Mr. Hedican, to work according to their conscience and their faith 

This case is important for all Americans who are faced with similar conflicts in the workplace, put to the choice between their faith and providing for their family even where reasonable accommodation is possible. People are more than punches in a timecard, and the law should assure that every American has the right to live and work according to their religious convictions.  

Importance to Religious Liberty:

Individual Freedom—Religious exercise encompasses more than just thought or worship—it involves visibly practicing the signs of one’s faith, at home and at work. All Americans must be free to live according to their consciences without fear of losing their jobs.  

Wisconsin Churches Reopen

Houses of Worship are Essential

The Catholic Diocese of Madison has been committed to preserving the health and safety of its community members throughout the coronavirus pandemic, voluntarily suspending public masses before it was mandated by the state and generally cooperating with the directives of the local and state health officials from the beginning. They have not neglected their Christian duty either, heroically springing into action to provide remote schooling, care for the sick and dying in Catholic hospitals, and continue serving the hungry, uninsured and incarcerated.

On May 18, 2020, Madison/Dane County officials put out an order listing houses of worship as “essential services” and thus allowing them to resume holding in-person services at 25 percent capacity. The Diocese of Madison got straight to work to put together a plan for safely reopening with appropriate social distancing and hygiene protocol.

Dashed expectations

But just when members of the Catholic community thought that they would finally receive the spiritual solace and healing they’d been craving, Madison/Dane County pulled the rug out from under the Diocese. After the Diocese published its safe reopening plan, on May 22, 2020, Madison/Dane County put out a new order capping in-person worship services at 50 people. This new order meant that some Catholic churches in Madison would be limited to less than five percent capacity, while shopping malls, bars, restaurants, spas, gyms, salons, museums, movie theaters, community centers, bowling alleys, skating rinks, trampoline parks and more were free to open at 25 percent capacity.

Following the May 22 order, the Madison/Dane County Health Department contacted Diocesan officials and parishes to inform them that overseers would be sent to churches and fines of up to $1000 would be imposed for every instance in which more than 50 people were gathered for Mass.

Constitutional consequences

On June 3, 2020, Becket, Sidley Austin LLP, and Troutman Sanders LLP sent a letter to County Executive Parisi and Mayor Rhodes-Conway explaining that the 50-person cap is unconstitutional and illegal. On June 5, 2020 Mayor Rhodes-Conway and County Executive Parisi released a new “Forward Dane” executive order returning houses of worship to equal footing with secular services at 25 percent capacity for in-person worship services.

Importance to Religious Liberty:

  • Religious communitiesThe First Amendment’s Free Exercise clause protects religious Americans from undue burdens on their religious exercise. When churches are given a special disability not felt by secular entities, the government is violating the Free Exercise Clause by burdening religious practice.

Grussgott v. Milwaukee Jewish Day School, Inc.

The Milwaukee Jewish Day School welcomes a broad diversity of Jewish students from the surrounding community. The school’s basic Jewish beliefs are broadly incorporated into its curriculum, with students attending daily prayer, studying Hebrew, observing Jewish holidays and the Sabbath, and studying the Torah. The Jewish faith drives the school’s mission, and the school’s teachers are an integral part of accomplishing that mission.

But one former teacher claimed the school is not “Jewish enough” to qualify for First Amendment protection from government meddling in the school’s internal religious decisions.  That protection—known as the “ministerial exception”  is the requirement that the government stay out of religious groups’ selection of their own religious leaders. (For a more detailed explanation, see this video.) The teacher taught Hebrew and Jewish studies, taught directly from the Torah, and led the students in daily regular prayer—but she claimed she was not a religious leader or part of the school’s religious mission.

In September 2016, the former teacher sued the school in a Wisconsin federal district court, claiming she had been unlawfully terminated. The court rightly rejected her arguments and ruled that a teacher like her, who regularly led prayer and taught religious studies, qualifies as a minister under the First Amendment’s ministerial exception—and that the school has the right to choose its own religious leaders. Displeased with the court’s decision, the teacher appealed to the U.S. Court of Appeals for the Seventh Circuit. Becket filed a friend-of-the-court brief in October 2017, urging the Seventh Circuit to protect religious schools of all faiths from government interference. In February 2018, the Seventh Circuit ruled in the school’s favor, adopting Becket’s position that the school was without question a religious institution protected by the ministerial exception. And as Becket further pointed out, the Court’s opinion concluded that the plaintiff’s “role as a teacher of [ ] faith to the next generation outweighed other considerations” and showed that she was covered by the ministerial exception. Becket’s amicus brief called for this result, emphasizing that the ministerial exception applied because the plaintiff’s “role required her to perform important religious functions for the school,” particularly because she “taught the tenets of the faith to the next generation.”  In November 2018, the U.S. Supreme Court declined to hear the appeal, leaving the decision in favor of the school in place.

The Seventh Circuit’s opinion in favor of Milwaukee Jewish Day School is significant, because it marks the first time that the Seventh Circuit has defined and confirmed the scope of ministerial exception since the U.S. Supreme Court’s landmark 9-0 decision in Hosanna-Tabor, where Becket defended a Lutheran church school’s right to choose its own teachers.

The school was represented by Kravit, Hovel & Krawczyk (Aaron Aizenberg).

Importance to religious liberty

  • Freedom of religious groups to choose their own leaders: Becket’s 2012 Supreme Court case Hosanna-Tabor set a precedent on this issue for churches.
  • Freedom of religious groups from state intrusion on religious affairs: Both church and state are better off when the state isn’t meddling in the internal religious affairs of a religious ministry.

Freedom From Religion Foundation v. Koskinen & Holy Cross Anglican Church

As a minister with over 25 years of service and a Benedictine abbot, Father Patrick Malone has long been serious about his faith.

So when he  became the vicar of Holy Cross Anglican Church, Father Malone carried that commitment into preaching how to live as faithful Christians. This includes guiding Holy Cross’s 55 members about seeking justice and protect the disadvantaged in society, especially those who are threatened by unjust laws.

To Father Malone and Holy Cross, this requires preaching on issues like abortion and against the politicians and candidates who support abortion. They believe that silence on the sanctity of life, even while remaining true to other Anglican beliefs with fewer public policy implications, would be just as unfaithful to God as churches that preached against gambling in the antebellum South while failing to stand against slavery. Instead, they follow the tradition of their Anglican forbears who preached to reform child labor laws, the slave trade, and prison policies.

But the Freedom From Religion Foundation (FFRF) filed a lawsuit demanding that the IRS enforce a law banning Father Malone’s sermons to Holy Cross. While the IRS has long banned sermons that concern political candidates or certain hot-button moral issues, it has generally avoided actually enforcing the ban against churches, likely because it knows that its rules stand on shaky constitutional ground.

The anti-religious FFRF noticed, and sued in a Wisconsin-based federal district court to force the IRS to start enforcing the ban against churches like Wisconsin-based Holy Cross Anglican.  FFRF wanted the IRS to punish Father Malone and the Church for his sermons by imposing regulations that would revoke the Church’s tax-exempt status, involve the IRS in the Church’s finances, and levy fines against both the Church and individual leaders, such as Father Malone.

Becket successfully intervened on behalf of Father Malone and Holy Cross to defend their rights to freely preach. While there’s room for religious disagreement over what pastors should preach, those religious decisions should be left to churches, not the IRS or FFRF. This case presented a unique opportunity to defend a church’s right to preach free from IRS censorship.

On August 1, 2014, the Court granted FFRF’s request to dismiss its own lawsuit, fleeing from its attempt to use the IRS to censor houses of worship who preach on moral issues with political implications.


Gaylor v. Mnuchin

Pastor Chris Butler serves communities in South Side, Chicago

The leader of a predominantly African-American congregation, Pastor Chris Butler devotes his life to serving communities in Chicago’s poorest neighborhoods. Pastor Chris spends countless hours leading his church’s community ministries, including the Chicago Peace Campaign, which has been successful in bringing peace to areas devastated by violence; the Journeymen program that mentors at-risk youth; and a homeless ministry focused on feeding the hungry and providing blankets and toiletry kits.

The church can’t afford to pay Pastor Chris a salary, but it offers him a small housing allowance so he can afford to live just minutes from his church and the community he serves.

FFRF’s lawsuit harms Pastor Chris’s church and other underserved communities

For over 60 years, federal law has recognized that housing allowances like Pastor Chris’s shouldn’t be taxed as income. This helps ensure that pastors, rabbis, imams, and other faith leaders—who often use their homes for their ministries—are able to live close to the communities they serve. The law is based on the same tax principle that allows employers to reimburse travel and overseas housing costs and provide tax-free housing allowances to teachers, business leaders, military service members, and thousands of other employees who use their homes for their jobs.

But in 2011, the atheist group Freedom From Religion Foundation (FFRF) sued the IRS to eliminate the tax exemption for housing allowances—putting communities, like the ones Pastor Chris serves, at risk.

Becket defends all faith leaders from discrimination

In 2011, a federal court ruled that the tax exemption for housing allowances was unconstitutional. After the Seventh Circuit threw out that ruling on technical grounds, FFRF sued again in 2016. In January 2017, the court allowed Becket to intervene in the case on behalf of Pastor Chris Butler and Bishop Edward Peecher of Chicago Embassy Church, Father Patrick Malone of Holy Cross Anglican Church, and the Diocese of Chicago and Mid-America of the Russian Orthodox Church Outside of Russia. In October 2017, the district court again struck down the tax exemption for housing allowances.

In February 2018, Becket appealed the decision to the Court of Appeals for the Seventh Circuit on behalf of the churches, which agreed to hear the case. Oral argument took place on October 24, 2018.

On March 15, 2019, the Seventh Circuit unanimously ruled that the parsonage allowance is constitutional, stating it “is simply one of many per se rules” that “allow hundreds of thousands of employees (including ministers) to receive tax-exempt housing every year,” and that it is consistent with the nation’s “lengthy tradition of tax exemptions for religion, particularly for church-owned properties.”

In June 2019, FFRF decided not appeal the Seventh Circuit’s decision, definitively securing a victory for the parsonage allowance and houses of worship across the country.

Importance to religious liberty

  • Establishment Clause: The longstanding tax exemption for housing allowances ensures that ministers are treated the same way as teachers, business leaders, military service members and hundreds of thousands of other workers who receive tax-free housing for their jobs. Equal treatment doesn’t violate the Establishment Clause.

Elmbrook School District v. Doe

The Question

Where would you rather attend your high school graduation: In a hot, sweaty gym? Or in a state-of-the-art church auditorium? For the Elmbrook School District, the question was a no-brainer: It chose the auditorium.

The school gym was hot, cramped, and sweaty in the month of June—with no air conditioning, inadequate parking, poor handicapped facilities, and only folding chairs or bleachers for seating. So the senior class proposed moving graduation to a local church auditorium.

The auditorium had more space, more parking, better handicapped facilities, and better seating. It had large video screens for close-up viewing. It had air conditioning. And it cost the same as the school gym.

The District happily moved graduation to the auditorium, and for the next decade, the students were delighted.

The Lawsuit

Then came the lawsuit. A secularist organization claimed that certain students were “offended” and “angry” at the use of the church auditorium. They admitted that the graduation events were entirely secular, and that no prayers or religious references had ever been made. But they disliked the fact that there was a cross at the front of the auditorium, Bibles and hymnals in the pews, and church brochures in the lobby.

A federal district court quickly rejected their lawsuit. But surprisingly, the Chicago-based United States Court of Appeals for the Seventh Circuit ruled that renting the church auditorium was unconstitutional. It said that the “religious environment” of the auditorium created a risk that graduating students would “perceive the state as endorsing a set of religious beliefs.”

The Supreme Court Appeal

That’s when the School District turned to Becket. We knew that the case was important:  Hundreds of school districts hold graduations in religious venues, because those venues are often the best and cheapest available. The Constitution does not require school districts to treat religion like a toxic subject that must be avoided.

But we also knew that the odds were against us: The U.S. Supreme Court agrees to hear only about 1% of cases that are appealed to it.

On December 20, 2012, we appealed to the U.S. Supreme Court. After a year-long delay, the Supreme Court declined to hear the case. But in a strong show of support, Justices Scalia and Thomas dissented, arguing that the lower court had failed to apply the proper legal standards.

Becket remains ready to defend the principle that religion is a vital part of human culture—not a toxic subject to be avoided.


Calvary Assembly of God, Wisconsin

For more than 50 years, the Internal Revenue Service (IRS) has used an extremely broad interpretation of the tax code to censor and intimidate religious leaders of every faith. In short, they occasionally come out of the shadows and threaten a house of worship with losing its religious tax exemption if its religious leaders speak too openly about political issues. Such threats often coincide with heated political races where moral issues are of high importance. And the IRS is often put up to it by hyperseparationist groups like Americans United for Separation of Church and State.

So Becket decided to take the challenge right back to the IRS.

On January 16, 2008, Becket publicly dared the IRS to investigate the Calvary Assembly of God in Algoma, Wisconsin, after its pastor, Kenneth Taylor, used his pulpit to preach about the moral implications of a number of different campaigns going on at the time. We made sure the IRS wouldn’t miss the challenge and printed it as an open letter in Wall Street Journal, knowing that if they pressed forward with the threat, the public would be outraged, and if they backed away, they would essentially concede that you cannot muzzle religious speech in the name of the tax code.

Pastor Taylor has yet to hear from the IRS. Paper tiger?