In a unanimous 9-0 decision on Thursday, June 29, 2023, the United States Supreme Court explained that courts have been getting the law on religious accommodations wrong for the past five decades. The high Court held an employer may reject an employee’s request for a reasonable accommodation based on religious belief or religious practice only if it can show “undue hardship,” meaning “substantial increased costs in relation to the conduct of the particular business.” This is a higher standard than the “more than de minimis” standard applicable under federal law since 1977.
Groff v. DeJoy
In Groff v. DeJoy, the Third Circuit affirmed summary judgment for the United States Postal Service (USPS) on Gerald Groff’s religious discrimination claim. Groff, an Evangelical mail delivery employee, observed Sunday as the Sabbath. After USPS agreed to facilitate Amazon deliveries on Sundays, the mail delivery service eventually required Groff to work on Sundays. Groff refused, received “progressive discipline,” eventually resigned, and sued, alleging USPS violated federal anti-discrimination law by not allowing him Sundays off. The Supreme Court held the judgment for USPS was improper and remanded the case to the lower courts to apply the correct standard.
Title VII
Groff sued under Title VII of the Civil Rights Act of 1964, which prohibits discrimination in employment based on various protected characteristics, including religion. Title VII also requires employers to reasonably accommodate an employee or prospective employee’s sincerely held religious beliefs and practices unless providing an accommodation causes the conduct of the employer’s business to suffer an “undue hardship.” The Groff case revisits and defines “undue hardship” in a significantly different way than it had been defined in prior Supreme Court precedent.
Hardison and the De Minimis Cost Standard
The Third Circuit reasoned that accommodating Groff’s practice of refraining from work on Sundays caused USPS to suffer undue hardship because it “imposed on his coworkers, disrupted the workplace and workflow, and diminished employee morale” and such costs, according to the court, were more than “de minimis” or trivial. The “de minimis” threshold came from the Supreme Court’s 1977 decision in Trans World Airlines, Inc. v. Hardison. In Hardison, the Court held that Title VII does not require an employer to accommodate an employee’s practice of observing the Sabbath in contravention of a collectively-bargained-for seniority agreement. Though the Court in Hardison did not provide an exact measure for determining when costs create an undue hardship, it stated in one part of its opinion that “to bear [more than] a de minimis cost . . . is an undue hardship.” In the forty-five-plus years since Hardison, federal courts have applied the low “de minimis” standard to determine whether an employer must provide a religious accommodation.
Groff and the Substantial Cost Standard
In Groff the Court instructed that Hardison’s reference to a “de minimis” or low-cost standard was in error and is not the law. Rather, the Court ruled that to deny an accommodation based on undue hardship, an employer must show that the proposed accommodation would entail a “substantial” cost to the business. The Court reasoned that the term “undue hardship” means “something hard to bear” that is “excessive” or “unjustifiable”—that is, something much more onerous than “de minimis.”
A Substantial Cost to Employers?
While the Groff decision “leave[s] the context-specific application” of the freshly refined undue-hardship standard to lower courts, the Court provides that the standard must account for all relevant factors, “including the particular accommodations at issue and their practical impact in light of the nature, size, and operating cost of an employer.” Because the opinion often discusses impacts in terms of the “cost” to the business, employers should quantify to the extent possible the anticipated costs of a requested accommodation. The amount of cost an employer must bear is no longer a low dollar standard, but rather, will be measured against the employer’s resources, much like is it under the ADA. Thus, a multi-state employer with considerable financial resources, compared to a local mom-and-pop shop, may be required to bear significantly more cost before it can legally refuse an otherwise-reasonable religious accommodation request.
While the new standard for measuring the cost of accommodation seems on its face a major change, the Court observed that current EEOC guidance on religious accommodation has already drifted away from the “de minimis” standard, and that the Court had “no reservations” in finding that related EEOC guidance will likely remain applicable and instructive for employers. The Court specifically endorsed the EEOC’s concept that temporary and transactional costs, like voluntary shift swapping, administrative costs to arrange shift adjustments, and occasional changes, will not alone reach the new “substantial cost” standard.
Additional Guidance for Employers
The Court also spoke to the question of whether annoyance or inconvenience to fellow employees can be measured as part of the costs of accommodation. Here the Court ruled that the costs, to qualify, must “affect the conduct of the employer’s business” and not merely affect other employees. The Court made especially clear that coworker animus based on intolerance for religion in general, or the specific religion of the requesting employee, may not be taken into account. Importantly, two concurring Justices wrote to make clear that the effect on coworkers can still be taken into account if not driven by their unlawful bias. Whether this clarification will be adopted by lower courts remains to be seen.
The Court also provided that, before determining a requested shift exemption would be costly, the employer should explore lower cost alternatives, like volunteer swaps.
The most significant lesson for employers from Groff is the requirement under the new standard that any calculation of the cost of an accommodation must show how the proposed accommodation “affects the conduct of the business.” The majority suggests that an employer must do more than simply show that a religious accommodation creates resentment among employees assigned to cover shifts, stating “[i]mpacts on coworkers are relevant only to the extent those impacts go on to affect the conduct of the business.” Instead, employers must articulate how the business experiences actual harm, cost or substantial disruption. This may prove a relatively simple task when an employee possesses a unique and essential skillset, or when an employer is understaffed. However, in light of Groff, mere decline in co-worker morale, may not be enough to support a denial, unless it is linked to a non-trivial effect on the conduct of the business. The concurring Justices made a special point of noting that decline in morale is itself a critical issue for employers, noting that “for many businesses, labor is more important to the conduct of the business than any other factor.”
Because Groff technically did not overrule Hardison, its new standard may well apply to pending cases, though this issue is not free from doubt. What is clear, though, is that it demands courts shift how they determine the existence of an undue hardship, raising the bar from “de minimis” to “substantial” costs. Ultimately, whether the law requires an employer to provide a religious accommodation is a fact-specific inquiry that must be assessed on a case-by-case basis.
Also importantly, the anti-discrimination laws of some states already follow a different standard than the previous federal “de minimis” standard. California’s Fair Employment and Housing Act, for example, uses a “reasonable accommodation” standard, essentially the same as for accommodation requests based on disability. Employers should review the law of their state when addressing and responding to employee requests for accommodation based on religious beliefs or practices, as those state laws may use a standard different from that under Title VII.
