Hobby Lobby and the Supremes

Religious messages are routinely posted to Hobby Lobby's website

According to a lawyer for the owners of craft-store chain Hobby Lobby, it's important to their family's religious beliefs to provide health care to their 22,000 employees. But it also offends their religious beliefs to provide certain forms of birth control, which they believe – contrary to science – act as abortifacients.

That means that Hobby Lobby's reportedly deeply held belief that employees should be provided with health care means they should be provided only the health care that the company feels is appropriate – and that does not include access to basic preventive care that may actually be important to those employees.

Whether a corporation is able to assert its religious freedom in such a manner, and whether the law protects third-parties, such as the employees, who may be injured by such an assertion, were central to questions raised Tuesday by justices of the U.S. Supreme Court during oral arguments. In their lawsuit, two private companies are challenging a provision of the federal Affordable Care Act that requires health insurance to cover nearly two dozen forms of birth control.

For 90 minutes, the justices challenged Paul Clement, who is representing Hobby Lobby and Conestoga Wood Specialities (owned by Mennonites), which are challenging the law's requirement, and Donald Verrilli, the government's solicitor general who defended the government's ability to require the companies to comply with the contraceptive mandate.

According to Clement, the Religious Freedom Restoration Act and the First Amendment protect the companies' belief that certain birth control methods – for Hobby Lobby that includes IUDs, and emergency contraceptives; for Conestoga, EC – and liberate them from having to provide insurance that covers these methods as part of comprehensive health care insurance required by ACA.

The Court's female judges immediately challenged Hobby Lobby's position – if corporations have religious freedoms that can be protected, what's to stop them from objecting to any number of other medical treatments or government mandates, like vaccinations, or prohibitions on child labor or workplace sex discrimination, Justices Sonia Sotomayor and Elena Kagan asked. Clement said he doubted such challenges would materialize, but that if they did each would have to be taken up by the courts. That's an unwieldy solution, Kagan suggested: "So one religious group could opt out of this and another religious group could opt out of that, and everything would be piecemeal and nothing would be uniform," she said, according to a transcript of the proceeding.

And there is another way to resolve the issue, Sotomayor and Kagan each pointed out. While Hobby Lobby has lamented that it would have to pay some $475 million for refusing to cover all 20 contraceptive options included under ACA, it does have before it a much less onerous option: Pay the tax associated with not providing any employer-based health care. That would come to just $26 million for the company, less than it currently costs to cover its employees. "There's a choice," Kagan said. "And so the question is, why is [does the law create] a substantial burden" on the company's religious beliefs "at all?"

"I thought that part of the religious commitment of the owners was to provide health care for its employees," Chief Justice John Roberts interjected.

"That is true, Mr. Chief Justice," Clement replied.

"Well, if they want to do that, they can just pay a greater salary and let the employees go in on the [healthcare] exchange," Sotomayor replied.

That's not feasible either, Clement suggested, because "it's going to very much hurt Hobby Lobby if all of a sudden it doesn't provide health care to its employees. And in order to compensate for that, it would have to increase … wages."

Kagan argued that the cost to Hobby Lobby to raise wages so that employees could afford their own insurance would likely come out to much the same cost to the company as it would be to pay the tax for failing to comply with the Act. The law is "not saying you must do something that violates your religion," she said. "It's giving you a choice. You can do this thing, or if this thing violates your religion, you can do another thing. And that other thing is approximately the same price as the thing you don't want to do."

Indeed, Justice Anthony Kennedy, often the court's swing vote, seemed to agree: If the costs all evened out "why [is paying the tax and raising wages] a problem?" he asked. "[H]ow is the employer hurt?"

Clement insisted that it would cost Hobby Lobby more to raise wages and pay the tax, and that not providing health care – "which is something they believe is important for their religion as well" – would hinder their ability to attract employees.

Wanting to "be good employers" is a "different thing than saying that their religious beliefs mandate them to provide health insurance" and in this case, health insurance that, because it lacks birth control options for women "is not adequate," Kagan said. And, asked Kennedy, what about those employees? What are their rights? "The employee may not agree with these … religious beliefs of the employer," he said. "Does the [company] religious beliefs just trump? Is that the way it works?"

Clement suggested that there is an alternative, that insurers pick up the cost for the contraceptives objected to by the companies. Indeed, the government has already created a means for nonprofit religious employers to do just that.

In defending the government's position, Verilli opened with a quote from former Justice Robert Jackson, that religious freedom must be "bound" when it affects or collides with "the liberties of others of the public." Not so much, Roberts replied, suggesting he believes that companies do have religious rights: "The whole point of RFRA is that Congress wanted to provide exceptions" for religious views, including those of "proprietors."

Justices Roberts, Antonin Scalia, and Samuel Alito grilled Verilli about the government's position, given that it has also created an exemption for church employees. Scalia argued that the exceptions, created by the government, suggest that it cannot demonstrate that it has a "compelling interest" in providing women with contraceptive care at all. Verilli argued otherwise: Only churches are actually exempt, while other religious employers have been given a workaround, but are nonetheless still required to offer the contraceptive care. What Hobby Lobby is asking for is thus a completely unique exemption – and, he argued, companies like Hobby Lobby would likely also raise a religious objection if asked to sign off on any paperwork that would allow the insurer or government to pay for the birth control methods they object to.

"So don't make them sign a piece of paper," Scalia interjected.

Regardless, Verilli argued, creating a mechanism for these kinds of objections would increase significantly the cost to the government.

Verilli said that it is important to look at what Congress meant to do when it passed RFRA in 1993. And that was not to provide for-profit corporations with a means to object to other legal requirements as infringing on their religious freedoms. Notably, he said, to date, no company has brought a successful RFRA challenge. But, Roberts said, there is nothing that would preclude that from happening.

Indeed, Kennedy noted, under Verilli's view "a profit corporation could be forced … in principle," though current statutes would prohibit this, "to pay for abortions." There is no law on the book that would require that; in fact, the law would clearly prevent that.

"Isn't that what we are talking about in terms of their religious beliefs?" Roberts asked. Hobby Lobby believes these contraceptives are actually abortifacients. "I thought that's what we had before us."

"It is their sincere belief and we don't question that," Verilli said – because the government can't be in the business (let alone argue in court that it should be in the business) of deciding whose religious beliefs are valid. But federal and state law, which do "preclude funding for abortions, don't consider these particular forms of contraception to be abortion," he continued. "With all due respect, I would say that … we've got about 2 million women who rely on the IUD as a method of birth control in this country. I don't think they think they are engaged in abortion in doing that," he continued. "And so … I do think that that is what makes this a difficult case."

The court is expected to rule in June.