Reuters US Politics
By John Kruzel
WASHINGTON (Reuters) -The U.S. Supreme Court on Thursday endorsed a bid by an arm of a Catholic diocese in Wisconsin for a religious exemption from the state's unemployment insurance tax in the latest ruling in which the justices took an expansive view of religious rights.
The 9-0 ruling, authored by liberal Justice Sonia Sotomayor, overturned a lower court's decision that had rejected the tax exemption bid by the Catholic Charities Bureau - a nonprofit corporation operating as the social ministry arm of the Catholic diocese in the city of Superior - and four entities the bureau oversees.
At issue was whether Wisconsin's denial of the tax exemption violated the U.S. Constitution's First Amendment guarantee of free exercise of religion, as well as its separation of church and state. Under Wisconsin's unemployment insurance program, the state collects taxes from employers and uses the revenue to provide a temporary source of income to eligible jobless workers.
Sotomayor wrote that the Wisconsin Supreme Court's interpretation of the state's tax exemption amounted to religious discrimination by treating religious denominations unequally.
The lower court had disfavored groups like the Catholic Charities Bureau that do not seek to inculcate their faith as part of their charitable activities and serve a wider population than just fellow Catholics, even though these practices reflect Catholic religious doctrine, Sotomayor wrote.
"A law that differentiates between religions along theological lines is textbook denominational discrimination," Sotomayor wrote.
Sotomayor added that the First Amendment "mandates government neutrality between religions" and that denominational preferences by government officials are subject to the strictest form of judicial review.
The Catholic Charities Bureau since 1917, it said on its website, has provided "services to the poor, the disadvantaged, the disabled, the elderly and children with special needs as an expression of the social ministry of the Catholic Church in the Diocese of Superior."
Bishop James Powers of the Diocese of Superior welcomed the court's ruling.
"At the heart of Catholic Charities' ministry is Christ's call to care for the least of our brothers and sisters, without condition and without exception," Powers said.
"We're grateful the court unanimously recognized that improving the human condition by serving the poor is part of our religious exercise and has allowed us to continue serving those in need throughout our diocese and beyond," Powers added.
Patrick Elliott, legal director at the Freedom From Religion Foundation, a group that advocates for the separation of church and state, criticized Thursday's decision.
"This ruling is a dramatic expansion of religious exemptions that invites confusion, litigation and further erosion of state-church separation," Elliott said.
EXEMPTION ELIGIBILITY STANDARD
The federal government and all states exempt certain religious entities from having to pay into unemployment insurance programs. Most of these laws, including Wisconsin's, require that organizations be "operated primarily for religious purposes" for religious exemption eligibility.
Wisconsin's top court in 2024 found that while the Catholic Charities Bureau and its subsidiaries "assert a religious motivation behind their work," their activities were "primarily charitable and secular" and thus not "operated primarily for religious purposes."
The Catholic Charities Bureau and its subsidiaries do not require their employees to be of any particular religion, nor do they seek to instill Catholic beliefs in those receiving their services. Among the subsidiary groups involved in the case are organizations that provide services to people with disabilities including job placements and training, as well as daily living services and home visitation, according to court papers.
The Supreme Court, with its 6-3 conservative majority, has taken an expansive view of religious rights in a series of rulings in recent years. In May, however, it blocked a bid led by two Catholic dioceses to establish in Oklahoma the nation's first taxpayer-funded religious charter school.
In 2022, the court backed two Christian families in their challenge to Maine's tuition-assistance program that had excluded private religious schools. It also ruled in 2022 that a Washington state public school district violated the rights of a Christian high school football coach who was suspended for refusing to stop leading prayers with players.
In 2021, the court backed a Catholic Church-affiliated agency that sued after Philadelphia refused to place children for foster care with the organization because it barred same-sex couples from applying to become foster parents.
In 2020, it endorsed Montana tax credits that helped pay for students to attend private religious schools, ruling in favor of three mothers of Christian school students.
In 2017, it sided with a Missouri church in ruling that churches and other religious entities cannot be flatly denied public money based on their religious status - even in states whose constitutions explicitly ban such funding.
(Reporting by John Kruzel; Editing by Will Dunham)