July 28, 2021

Demkovich: The Ministerial Exception Bars Harassment Claims Too

“The First Amendment ministerial exception protects a religious organization's employment relationship with its ministers, from hiring to firing and the supervising in between.”

This summer, with the foregoing declaration, the en banc Seventh Circuit Court of Appeals (covering Illinois, Indiana, and Wisconsin) dismissed a minister’s hostile work environment claim against his church employer and significantly clarified and strengthened religious institutions’ rights pertaining to their employment of ministers. The Court’s decision in Demkovich v. St. Andrew the Apostle Parish, Calumet City, overturned a smaller panel of the Circuit Court holding that the “ministerial exception” was not applicable and therefore that ministerial employees could pursue hostile work environment claims.

As a result of this decision, churches and other worshipping bodies within the Seventh Circuit’s jurisdiction (and perhaps beyond), should enjoy legal protection from a wider range of ministerial employment-related claims as a result of the decision. Such worshipping bodies may continue to lean into their sincerely held religious beliefs as a strong basis for their important employment-related decisions. But this decision intensifies a split among the federal courts of appeals, which may lead to a U.S. Supreme Court ruling with further clarification. The following paragraphs provide some background to the decision, analyze the court’s reasoning, and discuss implications for religious employers and further court proceedings.

Employment/Religious Organizations
July 23, 2021

Christians Engaged: Getting Religion, Politics, and Public Charity Status Right

Earlier this summer, the IRS issued a now-well-publicized rejection letter against Christians Engaged (CE) for being too political to qualify for Section 501(c)(3) tax-exempt status. But, as explained in its IRS Form 1023 application, Christians Engaged operates for religious purposes, encourages people to pray for our country’s leaders, educates on moral issues with public policy, and carries out other activities with political overlays. An uproar ensued in opposition to this denial among tax practitioners, religious organizations, and politicians – with the welcome result that the IRS reversed course and summarily recognized the organization’s tax-exempt status. Was the IRS initially right or wrong? What could Christians Engaged have done better? And what can other Section 501(c)(3) organizations learn from the IRS’s bizarre handling?

Religious Organizations
July 9, 2021

Schedule B Donor Disclosures: Supreme Court Sides with Charities

On July 1, 2021, the Supreme Court ruled in Americans for Prosperity Foundation v. Bonta (AFPF v. Bonta) that the California Attorney General may no longer collect Schedule B donor information from charities registered to solicit in the state. In a 6-3 decision, the Supreme Court held that “California’s blanket demand that all charities disclose Schedule Bs to the Attorney General is facially unconstitutional.” Writing the majority opinion for the Court, Chief Justice Roberts reasoned that California’s disclosure requirement violated donors’ freedom of association under the First Amendment and was not narrowly tailored to the important government interest of investigating charitable misconduct. This case represents a resounding victory to charities, and it will undoubtedly shape donor disclosure laws in other states, particularly within the context of charitable solicitation registration.

Fundraising/Nonprofit Corporate Law

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