HR and the Hobby Lobby Decision - American Society of Employers - Anonym

HR and the Hobby Lobby Decision

Two weeks ago everythingpeople.This Week! suggested that if the U.S. Supreme Court ruled against Hobby Lobby’s religious objection to covering certain forms of birth control in its group health plan, the question would probably go away permanently. Many HR departments would breathe a collective sigh of relief. But if it ruled in favor of Hobby Lobby, the potential for those HR departments’ jobs to become a lot more complicated could go up considerably.

On Monday, the U.S. Supreme Court ruled that family-owned and closely-held businesses do not have to offer contraceptive coverage in their group health plans if such coverage conflicts with their sincerely-held religious beliefs. Such coverage is generally mandated under the Affordable Care Act, although the government has already accommodated the desire of certain non-profit religion-based organizations to not pay for such coverage. The significance of this latest ruling is that it takes the accommodation of such religious concerns into the for-profit sector of the economy.

From the perspective of HR it also triggers a number of questions which, at least for the moment, are not answered and may not be answerable. Here are just some of those questions:

  • If a closely-held or family-owned business now decides to drop its contraceptive coverage because of ownership’s religious beliefs, will its decision be subject to some form of government scrutiny and then approved or disapproved? Or will the firm simply take action and let any challenge to it play out in the legal system? Clearly, HR would have to be heavily involved in any formal process that would take place, and would be equally involved in any legal dispute that might arise from it.
  • If other religion-based non-profits such as hospitals and religious schools, which employ large numbers of people from different faiths, invoke the Supreme Court’s legal rationale in the Hobby Lobby decision, will they too be able to drop contraceptive coverage in their plans? A number of such cases are currently working their way in the lower levels of the legal system. How must HR handle employee relations in such organizations while the legal questions play themselves out?
  • Could closely-held or family-owned businesses drop other aspects of their coverage besides contraception that they object to on religious grounds? According to Justice Alito, who wrote the opinion for the majority in the 5-4 decision, the decision applies only to contraceptive coverage and only to closely-held corporations. However, Justice Ginsburg wrote a stinging dissension for the minority that challenged both assurances, saying, “Although the court attempts to cabin its language to closely held corporations, its logic extends to corporations of any size, public or private.” Further, she argued that corporations could now object to “health coverage of vaccines, or paying the minimum wage, or according women equal pay for substantially similar work.” 
  • What happens if a closely-held or family-owned business with sincerely-held but non-mainstream religious beliefs attempts to impose its beliefs on its employees by way of its internal policies and practices? HR will have to be ready to handle what would likely be some very delicate employee relations issues.
  • What about LGBT (Lesbian, Gay, Bisexual, Transgender) issues? Many people of good will and sincerely held religious beliefs see those issues as religious issues and object to such things as same-sex marriage on religious grounds. Will we begin to see organizations establish policies and practices that are not LGBT-friendly and justify them on religious grounds?

Although Monday’s decision was not totally unexpected, many Supreme Court observers were surprised at the ruling. And the fact that it was far from  unanimous means that the issue is not likely to go away anytime soon. All of this means that HR’s role in organizations directly impacted by it may see their roles become infinitely more complicated in the months and even years ahead. And if Justice Ginsburg’s characterization of the decision as opening a kind of Pandora’s Box is accurate, its impact down the road could be felt even in large, publicly-traded corporations as well as all types of non-profits.

Sources: The New York Times 6/30/14; The Washington Post 6/30/14; Crain’s Detroit Business 6/30/14


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