California generally requires employers providing health insurance to their employees to ensure that such insurance covers the costs of contraception.  California has enacted a limited religious accommodation that exempts certain religious organzations (viz., churches), but not others, from this requirement.  Catholic Charities does not satisfy any of the four statutory criteria for the exemption, and it sued under the Establishment and Free Exercise Clauses to have the exemption extended.  The Cal Supreme Court ruled 6 to 1 that the limited exemption was constitutional -- although the court did tentatively conclude that at least one of the criteria was of dubious constitutionality.
 
The case raises numerous interesting issues concerning, e.g., the Ministerial Exception, general applicability under Lukumi, the so-called hybrid exception, Larson v. Valente, the scope of California's state constitutional free exercise guarantee, the notion of "substantial burden," etc.  To my mind one of the most interesting and difficult questions it raises is how a legislature can and should craft, and limit, religious accommodations.  The case demonstrates, in my view, why an across-the-board standard for exemptions -- such as those codified in federal and state RFRAs -- is preferable to a series of stand-alone, statute-by-statute legislative exemptions. 
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