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The Impact of Recent Supreme Court Decisions on Businesses and Employment

Three recent decisions have the potential to impact the way businesses operate

by Steven E. Abraham

Supreme Court decisions sometimes impact businesses and their employees.

At the end of June, the Supreme Court issued three decisions, all of which have the potential to impact the way businesses operate. In addition, a decision from January 2023 will impact unionized businesses as well.

Religious accommodations

In an article that appeared in the Oswego County Business Magazine in April 2022, I wrote about businesses’ duty to accommodate employees’ religious observance. Employers’ duty to make religious accommodations was clarified recently by the court in a case known as Groff v. DeJoy.

Gerald Groff, who worked as mail carrier for USPS, requested not work on Sundays as a religious accommodation.

The postal service tried to find other carriers to cover Groff’s Sunday shifts, but was unable to do so. As a result, it refused Groff’s request to have Sundays off, stating that his requested accommodation would cause “undue hardship.”

Eventually, the case reached the Supreme Court, which ruled in favor of Groff.

According to the court, in determining whether an employee’s accommodation requests would cause undue hardship, “courts must …  take into account all relevant factors in the case at hand, including the particular accommodations at issue and their practical impact in light of the nature, size and operating cost of an employer.”

The court clarified that an employer experiences an “undue hardship” in the context of an employee’s request for religious accommodations only when an employer shows that “a burden is substantial in the overall context of an employer’s business” (emphasis added).

Most experts have expressed the opinion that the court’s decision will make it more difficult for employers to avoid accommodating an employee’s request for religious accommodation. Employers should consider all aspects of how different religious accommodations may impact the nature and costs of their particular businesses.

Freedom of speech

In another recent decision, 303 Creative LLC v. Elenis, the court ruled that the First Amendment prohibits states from forcing business owners to promulgate/publish messages with which the business owners disagree on religious grounds.

303 Creative LLC offered website and graphic design, marketing advice and social media management services. The owner, Lorie Smith, wanted to begin creating wedding websites for customers, but was concerned that the state of Colorado would force her to express views inconsistent with her belief that marriage should be between one man and one woman. At the time, Colorado had a law prohibiting businesses from refusing to deal with to any customer based on sexual orientation (as well as other things).

Accordingly, Smith filed suit to clarify her rights under the First Amendment to the Constitution. Smith sought a ruling from the state court that if she were forced to abide by the Colorado’s Anti-Discrimination Act, it would violate her First Amendment Right against compelled speech in violation of her sincerely held religious belief that marriage is between a man and a woman.

The question in the case turned on whether Colorado could require the business to express messages with which the owner disagreed on religious grounds. Ultimately, the Supreme Court found that the First Amendment’s free speech clause prohibited Colorado from forcing an individual to speak in ways that align with the state’s own views but contradict the individual’s own conscience about a matter of significance. In coming to this decision, the court explained that the First Amendment’s commitment to the freedom of speech prohibits states from compelling speech, no matter how vital or sensible that speech may be.

Outside of the employment context, a business may be able to defend a refusal to deal with other businesses or customers if dealing with them would interfere with the business owner’s truly held religious belief.

In terms of employment, the decision may reassure employers that no state government may require them to express messages and ideas that do not comport with their own beliefs.

Nevertheless, employers should be cautious when considering the employment implications of this case. Employees are still entitled to numerous workplace protections under many state and federal laws. This decision does not allow a business to avoid those legal protections for employees.

Affirmative Action

In Students for Fair Admissions v. President & Fellows of Harvard College, the Supreme Court struck down the affirmative action admissions policies used by Harvard University and the University of North Carolina, on the grounds that those policies violated the Equal Protection Clause of the Fourteenth Amendment of the United States Constitution.

In November 2014, a lawsuit was filed against Harvard and UNC arguing that their race-based admissions policies violated Title VI of the Civil Rights Act of 1964, as well as the Equal Protection Clause of the Fourteenth Amendment. Ultimately, the Supreme Court held that these policies violated the Equal Protection Clause.

According to the court, the affirmative action policies used by Harvard and UNC did not pass the constitutional standard required for race-based decision-making. The court basically took the position that affirmative action policies constitute a form of “reverse discrimination” — by considering the race of applicants for admission, the universities were discriminating based on race.

While these were not employment law cases, the decision has implications related to employment.

Employers should remain careful not to institute racial hiring quotas or take employment action based on a person’s protected class status (e.g., race, sex, religion, etc.). This decision also may encourage race-based litigation, and employers may experience an increase in so-called “reverse” race discrimination claims.

Finally, if a business has any type of diversity, equity and inclusion (DEI) initiatives to enhance diversity and inclusion in the workplace, that business should review its practices to ensure they are in line with the guidance from the Supreme Court.

Unions and strikes

Earlier this year, in Glacier Northwest v. Teamsters, the United States Supreme Court ruled for the employer in a case with significant implications for the right of businesses to respond to a strike by a union by suing the union in state court for damages. The court held that an employer may sue a union in state court alleging intentional destruction of property.

Glacier Northwest (the business) prepares, mixes and delivers concrete by loading it in trucks for delivery the same day. The Teamsters Union ordered Glacier’s delivery drivers to strike right after concrete had been freshly poured into some trucks. As a result, the business suffered a great deal of damage because its concrete became unusable.

In response to the strike and the damage it suffered, Glacier sued the union in state court, claiming that the union intentionally and maliciously sabotaged, ruined and destroyed the concrete. The trial court dismissed the claims, concluding that they could not be made in state court, since the strike was “arguably protected” under the National Labor Relations Act (NLRA). The court relied on a doctrine known as preemption, which means that the NLRA preempts certain state laws and state court cases if those cases might implicate the NLRA.

The Supreme Court reversed the trial court and held for the employer, however.

The court held that while strikes are normally protected by the NLRA, and while claims for damages resulting from strikes normally may not be brought in state court, there are some situations where unions can be sued in state court for damages resulting from strikes, nonetheless.   Essentially, if the union takes “affirmative steps” to endanger the business’s property, the NLRA does not protect the union’s actions and the business may sue the union in state court.

This decision will likely make it easier for employers to pursue damage claims against unions in state court.  Conversely, it may make unions more wary of calling strikes that have the potential to damage employer property.

Steven E. Abraham is a professor in the school of business at SUNY Oswego. He also has practiced labor and employment law in New York City.