Running mom and pop businesses by the good book: the scope of religious rights of business owners.

Author:Selznick, Loren F.

    Prior to the (2014) decision in Burwell v. Hobby Lobby Stores, Inc., (1) a separation of church and commerce doctrine was developing unabated in federal and state courts. (2) As United States Solicitor General Donald B. Verrilli, Jr. put it at the Hobby Lobby argument: "[O]nce you make a choice to go into the commercial sphere, ... you are making a choice to live by the rules that govern you and your competitors in the commercial sphere." (3)

    In other words, business owners were free to practice religion on their own time, but when they entered the commercial world, faith had to bow to secular law. The Hobby Lobby case, construing the federal Religious Freedom Restoration Act, put an end to the notion of a nationally-imposed, religion-free commercial zone. (4) State and local zones, however, are a different matter.

    This article will contrast the religious rights of small business owners under federal and state law by visiting two recent battle sites in the American culture war. (5) Both controversies involved family-owned businesses operated in accordance with deeply held religious beliefs. (6) In both, the government required business owners to perform acts that violated their religious convictions. (7) In the federal cases, closely-held businesses faced fines under the Affordable Care Act for refusing to include emergency contraceptives in their employee health plans. (8) In the state cases, small businesses were penalized for violating antidiscrimination laws when they declined to provide services for same-sex weddings. (9)

    The issue is whether family-owned businesses can be run in accordance with religious principles when those principles conflict with the law. To what extent can federal, state, and local governments compel business owners to take actions they believe to be sinful? What has been the effect of Burwell v. Hobby Lobby Stores, Inc. on the separation of church and commerce theory?


    Religious freedom and tolerance are imbedded in the American psyche. Students begin learning about the history and tradition as early as nursery school and kindergarten when they are taught about the Thanksgiving holiday. (10) While Americans have generally accepted the concept of separation of church and state, the government and some interest groups have pressed for a separation between church and private business as well. (11)

    The concept would have been inconceivable to the Pilgrims and Puritans who escaped England seeking the freedom to live by their religious principles. When they came to North America, the Puritans sought the freedom to practice their religious faith "by applying the doctrines and commandments of the Bible to every detail of life," (12) including their commercial dealings. Puritanism was practiced primarily through day-to-day conduct and public action rather than "through sacred symbol" or "the glories or the pomps of art." (13) The "emphasis" was "on serving the Lord in one's vocation--as a tradesman, as a merchant, as an artisan, or as a magistrate or 'citizen.'" (14) The Quakers, too, established themselves in business by conducting their commercial enterprises in accordance with religious principles. (15)

    The Founders of the United States over a century later recognized the role of religion in commercial pursuits. (16) Thomas Jefferson said: "[Th]ose who labour in the earth are the chosen people of God.... It is the focus in which he keeps alive that sacred fire, which otherwise might escape from the face of the earth." (17) Benjamin Franklin said, "God governs in the Affairs of Men." (18)

    Between the Revolution and the Civil War, the United States became home to a number of religious communal movements in which religious rule ordered every facet of life, including the economy and the family. (19) Individuals spiritually rooted in the Great Awakening cleansed their own homes and their businesses of slavery. (20) "As long as slavery survived, how could the awakened know a true millennium, and how could the enlightened truly speak of the pursuit of happiness." (21)

    In the nineteenth century, it was commonplace for American businesses to integrate religious or moral philosophy into business practices and this continued into the early (1900) s. (22) Concern about working conditions during the Industrial Revolution led preachers to remind proprietors to carry the faith to work. (23) Minister Washington Gladden noted in the late nineteenth century that it was "the primary business of Christianity to define and regulate" the "relations of man to man," rejecting the argument that "his function [was] the saving of souls and not the regulation of business." (24)

    By the mid-twentieth century, however, a different approach emerged, that "religion should, for the most part, be zoned out of the marketplace and market relations," (25) and this view took hold in the law itself. (26) "The desirability of a religiously neutral workplace received legal manifestation with the passage of Title VII in (1964) ." (27)

    Today, many American businesses--particularly small mom-and-pop enterprises--have rejected this trend and attempted to operate their daily transactions in accordance with religious beliefs, viewing "religion not as one isolated aspect of human existence but rather as a comprehensive system more or less present in all domains of the individual's life." (28) There has been "a religious awakening of sorts, which has spawned a new breed of religiously serious executives, investors, employees, and customers, all of whom are pulling many business corporations toward a more faith-infused model." (29)


    Conducting business pursuant to religious rules has become more difficult. The law has injected secularity into every aspect of economic life as an ever-expanding collection of legal requirements on small businesses is enacted. (30) These requirements have inflamed two hot-button moral issues--emergency contraception and same-sex marriage--and raised the question whether religious business owners can be compelled to facilitate actions they believe to be sinful. (31) The common thread in these cases has been the government argument that when individuals choose to enter into a business, their religious liberties must yield to state interests. (32)

    1. Federal Controversy

      The Patient Protection and Affordable Care Act of 2010 stirred up national controversy about abortion and "reopened a long dormant battle over contraception." (33) Regulations promulgated pursuant to the Act required employers to provide insurance coverage for emergency contraception. (34) Religious business owners contested these requirements in federal courts, culminating in the Burwell v. Hobby Lobby Stores, Inc. case.

      The Act requires employers with more than fifty full-time workers to provide "qualified" health insurance plans to their employees or face penalties. (35) Qualified plans must include coverage, without cost-sharing, for preventive care and screening for women. (36) The Act left it to the Health Resources and Services Administration to establish guidelines for the particular care and screening required. (37) The agency, in turn, delegated this determination to the Institute of Medicine. (38) The Institute recommended that the agency require coverage for "[a]ll Food and Drug Administration [(FDA)] approved contraceptive methods, sterilization procedures, and patient education and counseling for all women with reproductive capacity." (39) The Health Resources and Services Administration accepted this recommendation. (40) The Food and Drug Administration had approved twenty prescription contraceptives, including two "emergency contraceptives ... known as Plan B and Ella [that] can function by preventing the implantation of a fertilized egg." (41) To "much of the pro-life movement ... emergency contraception is sometimes a way of inducing abortions." (42) Religious groups, including Catholic, Orthodox Jewish, and Protestant communities, raised objections to the contraceptive mandate. (43) However, if employers with religious objections refused to fund plans that insured any of the required drugs, they faced fines that could put them out of business. The law presented them with three choices: (1) violate their religious principles by providing coverage for contraceptives; (2) refuse to provide coverage for contraceptives and pay crippling fines; or (3) pay less expensive penalties for refusing to provide health insurance at all, but put themselves in a poor competitive position to attract qualified employees. (44)

      The religious faithful believed they were entitled to protection against what they saw as religious persecution. (45) The government response was simple: "[R]eligious beliefs ... cannot override statutory provisions protecting the interests of ... employees." (46)

    2. State Controversy

      The state-level moral issue for religious business owners is same-sex marriage (47) in conjunction with nondiscrimination laws. (48) With same-sex marriage legalized nationwide, (49) state anti-discrimination laws may be triggered. "Nondiscrimination laws can create significant conflicts for ... business owners when a customer requests some service that would violate the owners' religious beliefs." (50) Religious officials are generally exempted from performing same-sex weddings against their faith, but wedding service providers have no such protection. (51)

      Thus, business owners of faith who provide wedding related services, such as photographers, cake bakers, florists, and owners of wedding facilities, have been sued and fined for declining to participate in same-sex ceremonies. (52) The theory is that when a religious believer makes the choice to enter into the commercial world, all laws should apply regardless of religious objections. (53)

    3. Which Businesses Are Affected?

      Are "mom-and-pop" businesses run according to religious...

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