Edited by Lee Cotugno 
In Bostock v. Clayton County, the Supreme Court interpreted whether employers covered under Title VII of the Civil Rights Act of 1964 (“Title VII”) are prohibited from employment discrimination based on sexual orientation or gender identity, as well as based on biological sex.
The Court’s majority held that Title VII’s prohibition on sex-based employment discrimination does extend to sexual orientation and gender identity.
None of the employers in the decision were faith-based nonprofits. Accordingly, the Court did not directly address religious employers covered by Title VII whose sincerely-held religious beliefs regarding human sexuality conflict with the expanded definition.
However, the Court did note that faith-based organizations should be free to continue to operate in accordance with their sincerely-held religious beliefs. The Court cited existing religious liberty protections including the First Amendment, the Title VII religious liberty exemption, and the Religious Freedom Restoration Act.
In Our Lady of Guadalupe School v. Morrissey-Berru, the Supreme Court addressed the extent to which the First Amendment forecloses certain employment discrimination claims against a faith-based organization’s selection of key employees. This First Amendment limitation is known as the “ministerial exception.” The ministerial exception earned its name because it was first discussed in the context of a religious organization’s freedom to choose its ministers, most famously in 2012, through the well-known case Hosanna-Tabor Evangelical Lutheran Church and School v. EEOC.
The Court in Our Lady of Guadalupe held that, under the First Amendment, the government cannot regulate a faith-based organization’s employment decisions with respect to job positions that involve “educating  people in their faith, inculcating its teachings, and training them to live their faith” because such position are an exercise of religion “at the very core of a private religious school’s mission.”
The ruling is particularly relevant for faith-based schools, but other religious roles with responsibilities analogous to Catholic school teaching are likely within the scope of protections as well, when the roles involve “educating and forming students in the  faith” and such activities “lay at the core of the mission” of the religious employer.
For more information, see NLI Whitepaper: The Ministerial Exception: What Non-profit Leaders Need to Know by Kaytlin Roholt Lane.
Yes, in general, faith-based nonprofits with employees should use this as an opportunity to re-assess both the organization’s religious identity and its employment practices.
1. Religious Identity. An organization inspired or motivated by religious principles does not automatically qualify for religious exemptions, such as the Title VII religious exemption or the ministerial exception.
Instead, an organization’s legal eligibility for certain religious exemptions is determined based on several factors, which vary depending on the type of exemption. These factors generally include governing documents, employment criteria and resources, programming and activities, spiritual leadership, and marketing materials.
Accordingly, a faith-based nonprofit should work with an attorney to review the organization’s approach to these key areas. When necessary, the organization should update its practices to properly establish the organization’s eligibility for applicable religious exemptions.
2. Employment Policies and Practices. Relatedly, faith-based nonprofits should review their employment policies and practices with an attorney to understand which laws apply to the organization and what steps are needed for compliance.
The organization’s leaders should also clearly understand which laws and exemptions apply to the organization and why. Not every employment law applies to every faith-based nonprofit. Additionally, changes in an organization’s workforce, such as through an increase or decrease in staffing levels, can impact which laws apply to the organization. For example, Title VII only applies to employers with fifteen or more employees. Review corresponding state employment statutes is also important, as these laws may apply to employers with smaller workforces as well.
3. Religious Liberty Employment Protections. In Guadalupe, the Court specifically cited the religious schools’ employment agreements and faculty handbooks in determining whether the teachers’ positions were protected by the First Amendment. The Court noted that “a religious institution’s explanation of the role of such employees in the life of the religion in question is important.”
Accordingly, a faith-based nonprofit’s employment trainings and documents should clearly describe the religious dimensions and responsibilities for each role at the organization. General guidance, such as employee handbooks should clearly indicate the organization’s religious commitment and expectations for its employees. Specific employment documents, such as employment contracts and performance evaluations should include hiring and assessment criteria related to the individual’s commitment and witness to the organization’s religious mission. Equally important, if an employee’s specific job has a religious function, make certain that the religious function is, in fact, carried out by the employee. A disconnect between an employer’s policies and practices can result in the loss of key religious protections.
Title VII, the federal civil rights law interpreted in the Bostock opinion, addresses specifically federal employment law. However, there are federal and state statutes which also prohibit sex-based discrimination with respect to other matters.
For example, Title IX of the Education Amendments of 1972 is a federal statute prohibiting discrimination on the basis of “sex” in federally funded educational programs and activities.
State statutes may also prohibit sex-based discrimination in certain activities within the state. One example is the Florida Civil Rights Act, which prohibits sex-based discrimination in places of public accommodation.
The Supreme Court’s broad definition of “sex” in the Title VII context will likely be a strong influence in favor of expanding the definition of “sex” to include sexual orientation and gender identity in these other laws as well.
Legal Disclaimer: This post contains general educational information related to legal concepts, but this information does not constitute legal advice. Anyone seeking legal advice is strongly encouraged to consult with a licensed attorney regarding any of the matters discussed herein. Although licensed attorneys work with NLI, NLI is not a law firm and does not undertake legal representation on behalf of any clients. Further, no licensed attorney working with or on behalf of NLI agrees to undertake legal representation on behalf of any client unless the terms of such representation are set forth in a separate, written representation agreement.
 Lee W. Cotugno obtained his law degree from the University of California at Berkeley in 1977 where he was a Member of the Moot Court Board and graduated summa cum laude from the University of Minnesota in 1973. Prior to joining his present firm, Mr. Cotugno worked for a prominent Los Angeles law firm and litigated a variety of complex business and commercial cases. He has tried numerous jury and court trials and has been lead trial and appellate counsel in unfair competition, banking, labor and real estate actions. A substantial portion of Mr. Cotugno’s current practice is in the area of employment law, representing small to medium sized companies as well as corporate officers, employees and workers who have claims for wrongful termination, discrimination, harassment, and other violations of state and federal civil rights laws. Mr. Cotugno also advises and represents companies that seek to comply with state and federal employment laws in order to avoid litigation.
 Our Lady of Guadalupe School vs. Morrissey-Berru, Opinion of the Court. P 21.
 “[T}heir employment agreements and faculty handbooks specified in no uncertain terms that they were expected to help the schools carry out this mission and that their work would be evaluated to ensure that they were fulfilling that responsibility.” Lady of Guadalupe School vs. Morrissey-Berru, Opinion of the Court. P 21.
 § 760.08, Fla. Stat.