Three Recent Supreme Court Decisions and What They Mean for Employers in Maine

by Tara Walker and Bill Wahrer

In three notable recent decisions, the United States Supreme Court issued rulings that may have major implications for all employers.  Here is what you need to know and how they may impact your business.

Affirmative Action and Diversity Programs

The Supreme Court issued a long-awaited decision in the Students for Fair Admissions v. President and Fellows of Harvard College series of cases striking down affirmative action programs in college admissions. The final ruling contains broad language that may impact some employment programs.

Previously, institutes of higher education were permitted (based on the Supreme Court’s affirmative action decision two decades earlier) to consciously consider an applicant’s race as a factor in determining whether the student should be admitted. Although race could not be the determining factor, the Court allowed colleges and universities to narrowly consider an applicant’s race as a “plus” in an applicant’s file to further the benefits that flow from a racially diverse student body.

In the recent decision, the Court determined that even narrowly considering an applicant’s race in admissions is unlawful under the U.S. Constitution (for public entities) and Title VI of the Civil Rights Act (for private ones). Justice Roberts, writing for the majority, reasoned that under the existing rubric, there simply was no way to measure progress on the universities’ stated goals of “training new leaders,” “preparing engaged and productive citizens,” and “promoting a robust marketplace of ideas.” Further, he concluded there was insufficient proof that adding race as a factor would further those goals.

So what does this mean for employers?

The effect, both legally and practically, of the Court’s decision on employer-sponsored diversity, equity, and inclusion (DEI) efforts, affinity groups, and affirmative action programs has been grossly overstated in many recent news articles.

In its decision, the Court highlighted a principal “problem” that it sought to eliminate: the assumption that an applicant’s race shares particular characteristics that “further[ed] stereotypes that treat individuals as a product of their race.” While Justice Jackson aptly noted in her dissent that the history and reality of this country certainly means that members of some racial groups share certain characteristics, there is an important point for employers to take note of in the Court’s opinion: when considering race, not just in hiring, but in expressing your organization’s DEI goals and ethos, do not engage in stereotyping about someone’s lived experience, the qualities that they possess, or their contributions to the workplace.

Many have speculated that this could mean the death of affirmative action in the workplace, which could stall progress and efforts that have been made to make our modern workplaces more inclusive and equitable. Not so fast: workplace affirmative action plans are structured very differently from race-conscious admissions and do not rely on the same type of reasoning or furthering of stated goals that the universities proffered in this case. Here are a few things for companies to know:

1. In the workplace, under the existing Equal Employment Opportunity Commission (“EEOC”) framework for voluntary affirmative action plans, an employer must do an analysis to demonstrate underrepresentation of a particular group and adopt a specific, temporary plan with set goals and reasons specifically to remedy effects of past discrimination. An employer does not need to justify remedying the underrepresentation of workers with the broad or more generalized goals of the benefits of a diverse workforce, like those offered by the colleges and universities.
2. Unless the employer has a specific affirmative action plan that includes the goals to remedy past discrimination, employers are not allowed to and should not make employment decisions based on protected class status, which include race, color, ancestry, national origin, sex, sexual orientation (which includes gender identity and expression), physical or mental disability, religion, age, and other categories in certain contexts.

Although we can expect much political hay to be made (like recent letters sent to many major employers on this topic) about companies’ and organizations’ DEI efforts, there is nothing inherent in those programs that runs afoul of the employment laws in Title VII or Maine law, even after Students for Fair Admissions.

Religious Accommodations and Defining “Undue Hardships”

The second case handed down by the Supreme Court concerns religious accommodations under Title VII of the Civil Rights Act of 1964 and what an employer must show in regard to what constitutes an “undue hardship”—Groff v. Dejoy. Of three cases discussed in this article, Groff is the least controversial but likely the most significant for employers in terms of their day-to-day business operations.

Under Title VII, employers cannot discriminate against employees for practicing their respective religion unless the employer can show that the religious practice at issue cannot reasonably be accommodated without “undue hardship.” In a unanimous opinion, the Supreme Court clarified (but did not change) the legal standard for evaluating religious accommodation requests—specifically, what “undue hardship” means for purposes of a religious accommodation. It determined that “undue hardship” means a burden that is substantial in terms of the overall context of the business, which is factual specific for each employer in terms of its size and operating costs.  The Court specifically rejected that an undue hardship means an employer will incur a “de minimis” hardship in complying with accommodation request.

Other factors and variables for what employers should consider to determine whether or not a religious accommodation request will cause an undue hardship will develop through case law, as courts will now reexamine cases under this rearticulated standard.  However, given that what constitutes an undue hardship has been redefined, employers should reevaluate their own practices in terms of evaluating religious accommodation requests and consult with legal counsel regarding existing and new religious accommodation requests.

Public Accommodations and First Amendment Rights: The Wedding Website Case

In 303 Creative, LLC v. Elenis, the Supreme Court issued another highly controversial opinion whose scope and impact remains unclear in the conflict between state public accommodation laws and free speech principles. In this case, it was between a Colorado public accommodation law that prohibited public accommodations from refusing services to a person based on various protected classes, including sexual orientation. Although the ruling addressed public accommodations under Colorado law, readers should be aware that Maine’s public accommodation law is exceptionally broad, including “any establishment that in fact caters to, or offers its goods, facilities or services to, or solicits or accepts patronage from, the general public,” which includes most businesses.  In that case, the business at issue was a wedding website designer (a single member LLC) who claimed that the Colorado law violated her first amendment rights, compelling her to make “expressive speech” that violated her sincerely held beliefs. In other words, she claimed the state’s anti-discrimination laws required her as a designer to create work recognizing same-sex marriages, when same-sex marriage conflicted with her beliefs. The Supreme Court noted that, although eliminating all forms of discrimination is undisputedly a compelling state interest, Colorado’s law is not narrowly tailored enough to this compelling interested. The Court held that Colorado’s law violated the First Amendment (the practice of free speech) because it compelled expressive speech inconsistent with the speaker’s sincerely held beliefs.

The Court stressed that its holding was predicated on the stipulated facts—including the fact that the parties agreed that the creation of a wedding website was “pure speech” and expressive in nature.  The exact scope of the Court’s decision remains unclear because it is difficult to assess the parameters of “pure speech” in a business context and, further, the scope of expressive speech by a business owner.  The Court’s ruling only impacts Colorado businesses; however, it’s important to note that Colorado’s law is similar to many other state laws, including Maine’s public accommodation law under the Maine Human Rights Act, and the First Amendment is inapplicable to private businesses. Whether a court would say that the First Amendment trumps the Maine nondiscrimination protections under Maine’s public accommodations law will depend greatly on the nature and type of speech at issue.

While the exact impact of the Court’s decision remains to be seen in terms of the scope and enforcement of public accommodation laws, it is important to remember that this decision, while significant, is limited to what businesses it affects and that it does not alter an employer’s obligation to comply with non-discrimination statutes with respect to its employees.