A Unanimous Supreme Court Rules on Undue Hardship in Religious Accommodation: De Minimis Is Out, “Substantial Increased Costs” Is In

Seyfarth Synopsis:  A unanimous Supreme Court has issued its decision in Groff v. Dejoy, clarifying Title VII’s undue hardship standard to mean “substantial increased costs in relation to the conduct of its particular business.”  The Court effectively disavowed the long-standing de minimis standard from the seminal TWA v. Hardison case.  The Court held that impacts of an accommodation on coworkers are only an undue hardship if the employer can also show that those impacts on coworkers affect the conduct of the business.  It also held that the fact that an accommodation may force other employees to work overtime is not, by itself, sufficient to show undue hardship.

Background

Since February, Seyfarth Shaw has closely tracked the developments of the pending Supreme Court case, Groff v. DeJoy, an appeal from the Third Circuit that has called into question 45 years of workplace religious accommodation law. 

Petitioner Gerald Groff was a carrier for the United States Postal Service (the “Postal Service”) whose religious beliefs prohibited him from working on Sundays, in observance of the Sabbath.  The Postal Service offered to find employees to cover his shifts, but on more than twenty Sundays, none of Groff’s co-workers would swap with him.  When Groff refused to work on Sunday the Postal Service disciplined him, prompting Groff to resign.  Groff later sued the Postal Service for violating Title VII by failing to reasonably accommodate his religious beliefs.  

Title VII prohibits discrimination against any individual with respect to compensation, terms, conditions, or privileges of employment due to that individual’s religious beliefs, unless an employer demonstrates that it is unable reasonably to accommodate an employee’s religious belief without causing undue hardship to the employer’s business.  Citing Trans World Airlines, Inc. v. Hardison, the District Court ruled in favor of the Postal Service and the Third Circuit affirmed.  The United States Supreme Court granted Groff’s petition to review the legal reasoning espoused in Hardison.

Decided in 1977, Hardison has long been interpreted as having held that an accommodation creates an “undue hardship” if it causes more than a “de minimis” burden on the employer’s business.  While the Hardison Court referenced different formulations in its decision, its reference to a “de minimis” impact on the employers became the standard that many lower courts and the EEOC applied. 

As Seyfarth blogged in March and April, the proper interpretation of “undue hardship” and the outcomes of courts applying the “de minimis burden” standard took center-stage in the briefs of the parties, as well as various amici that filed briefs in support of either Groff or the Postal Service. 

In our last piece, we noted that during oral argument the Court sought to find common ground between both sides, expressed skepticism about importing the ADA standard into Title VII, and debated what amount of weight an accommodation’s effect on employee morale should be given in the analysis. 

Ruling:  The Undue Hardship Standard Clarified

The Court issued a unanimous opinion, written by Justice Alito.

The Court began with a reading of Title VII’s text and in particular the term “undue hardship.”  The Court noted that the ordinary meaning of “hardship” is “something hard to bear,” and “something more severe than a mere burden.”  The Court then noted that the modifier “undue” meant that the burden must rise to an “excessive” or “unjustifiable” level. 

The Court held that this was at odds with the ordinary meaning of de minimis, which means “very small or trifling.”  The Court thus held that the term “undue hardship” “points toward a standard closer to Hardison’s references to ‘substantial additional costs’ or ‘substantial expenditures.’”  Both of those terms had appeared, along with the term de minimis, in the Hardison decision. 

Synthesizing this analysis, the Court held that “it is enough to say that what an employer must show is that the burden of granting an accommodation would result in substantial increased costs in relation to the conduct of its particular business.”

The Court also held that courts must apply the test to take into account all relevant factors in the case at hand, including the particular accommodations at issue and their practical impact in light of the nature, size, and operating cost of an employer.

The Court held, “What is most important is that ‘undue hardship’ in Title VII means what it says, and courts should resolve whether a hardship would be substantial in the context of an employer’s business in the commonsense manner that it would use in applying any such test.”

The Court noted that both parties had agreed that the de minimis test was not the proper framing, but had proposed different formulations.  The Court rejected both parties’ proposed formulations, holding, “The Court declines to adopt the elaborations of the applicable standard that the parties suggest, either to incorporate Americans with Disabilities Act case law or opine that the EEOC’s construction of Hardison has been basically correct.” 

The Court noted that while some lower courts had understood that a full reading of Hardison required greater protection for religious employees than the term de minimis might suggest in isolation, other courts had not.  The Court pointed to amicus briefs filed by various religious groups including Sikhs, Muslims, and Seventh Day Adventists that suggested that the de minimis test had been applied to “bless[] the denial of even minor accommodations,” to the detriment of religious employees.

The Court attempted to minimize the impact of today’s decision on long-standing EEOC guidance, stating, “A good deal of the EEOC’s guidance in this area is sensible and will, in all likelihood, be unaffected by the Court’s clarifying decision. But it would not be prudent to ratify in toto a body of EEOC interpretation that has not had the benefit of the clarification the Court adopts today.”

Ruling – The Court Addresses “Several Recurring Issues” in Religious Accommodation Cases:  Effect on Coworkers, and Overtime

The Court also addressed directly what it called “several recurring issues.”

One such issue is the extent to which impact on coworkers can be an undue hardship.  The Court held that, “Impacts on coworkers are relevant only to the extent those impacts go on to affect the conduct of the business.”  The Court held that a court “must analyze whether that further logical step is shown” – that is, not only that coworkers are impacted, but that the impact actually affects the conduct of the business.  The Court grounded this holding in Title VII’s language, which requires an assessment of a possible accommodation’s effect on “the conduct of the employer’s business.” §2000e(j).

The Court also emphasized that “a hardship that is attributable to employee animosity to a particular religion, to religion in general, or to the very notion of accommodating religious practice, cannot be considered ‘undue.’ Bias or hostility to a religious practice or accommodation cannot supply a defense.”

The Court specifically addressed the issue of overtime, holding that, “Faced with an accommodation request like Groff’s, an employer must do more that conclude that forcing other employees to work overtime would constitute an undue hardship. Consideration of other options would also be necessary.”  The Court specifically called out voluntary shift swapping as one option that is “necessary” to consider.

The Court remanded to the lower courts to make context-specific application of the clarified standard.

Practical Takeaways

There are several key practical takeaways for employers:

• Employers denying requests for religious accommodation need to be prepared to show that the cost to their business of accommodating a religious request would be excessive or unjustifiable, and if they are relying on the impact on other employees, they must also show how the accommodation’s impact on other employees would substantially affect the conduct of the business. The impact on coworkers analysis may affect requests such as requests for schedule changes, Sabbath observance, or prayer breaks, for example.  One example of where impact on coworkers may affect the conduct of the business is when the accommodation would impose health and safety risks to coworkers or others.
• Employers should immediately provide training for any employees who review religious accommodations, including Human Resources and in-house counsel, on how to apply the new standard to requests for religious accommodation.
• Employers should consider the impact on any pending religious accommodation litigation. Given the way the decision is framed – as an interpretation of the plain meaning of Title VII and even of Hardison itself – courts may apply the Groff decision to existing cases. 

Seyfarth will host a webinar on July 10, 2023 on practical strategies for employees in the wake of the Groff decision. For more details and to register for the program, please visit the event information page here: Seyfarth Webinar | Workplace Religious Accommodations under the New “Substantial Increased Costs” Standard: Unanimous Supreme Court Decides Groff v. DeJoy

Seyfarth closely monitors myriad of polarizing cultural issues and how employers can protect against these cultural flashpoints. The breadth of Seyfarth’s LE practice uniquely positions Seyfarth to help balance competing viewpoints while minimizing fault lines, and defend employers in litigation and administrative matters that arise from the tension caused when different belief systems create conflicts. Learn more about our Navigating Cultural Flashpoints in the Workplace work and team.