Filed 3/1/04 
 
 
 
IN THE SUPREME COURT OF CALIFORNIA 
 
 
 
CATHOLIC CHARITIES OF  
) 
SACRAMENTO, INC., 
) 
  
) 
 Petitioner, 
) 
  
) 
S099822 
 v. 
) 
  
) Ct.App. 
3 
C037025 
THE SUPERIOR COURT OF  
) 
SACRAMENTO COUNTY, 
)  
Sacramento County 
 
)  
Super. Ct. No. 00AS03942 
 Respondent; 
) 
  
) 
 
DEPARTMENT OF MANAGED 
) 
HEALTH CARE et al., 
) 
 
  
) 
 
 
Real Parties in Interest. 
) 
 
___________________________________ ) 
 
In this case, we address a church-affiliated employer’s constitutional 
challenges to the Women’s Contraception Equity Act (WCEA),1 under which 
certain health and disability insurance contracts must cover prescription 
contraceptives.  The plaintiff employer, which opposes contraceptives on religious 
grounds, claims the statute violates the establishment and free exercise clauses of 
the United States and California Constitutions.  (U.S. Const., 1st Amend.; Cal. 
Const., art. I, § 4.)  The lower courts rejected the employer’s claims.  We affirm. 
                                              
1 
The WCEA comprises two laws, Health and Safety Code section 1367.25 
(Stats. 1999, ch. 532) and Insurance Code section 10123.196 (Stats. 1999, 
ch. 538).   
 
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I.  FACTS 
The Legislature enacted the WCEA in 1999 to eliminate gender 
discrimination in health care benefits and to improve access to prescription 
contraceptives.  Evidence before the Legislature showed that women during their 
reproductive years spent as much as 68 percent more than men in out-of-pocket 
health care costs, due in large part to the cost of prescription contraceptives and 
the various costs of unintended pregnancies, including health risks, premature 
deliveries and increased neonatal care.  Evidence also showed that, while most 
health maintenance organizations (HMO’s) covered prescription contraceptives, 
not all preferred provider organization (PPO) and indemnity plans did.  As a 
result, approximately 10 percent of commercially insured Californians did not 
have coverage for prescription contraceptives.   
The Legislature chose to address these problems by regulating the terms of 
insurance contracts.  The WCEA does not require any employer to offer coverage 
for prescription drugs.  Under the WCEA, however, certain health and disability 
insurance plans that cover prescription drugs must cover prescription 
contraceptives.  As an exception, the law permits a “religious employer” to request 
a policy that includes drug coverage but excludes coverage for “contraceptive 
methods that are contrary to the religious employer’s religious tenets.”2  Health 
and Safety Code section 1367.25 governs group health care service plan 
contracts;3 Insurance Code section 10123.196 governs individual and group 
disability insurance policies.4   
                                              
2  
Health and Safety Code section 1367.25, subdivision (b); Insurance Code 
section 10123.196, subdivision. (d). 
3  
Health and Safety Code section 1367.25 provides: 
 
“(a) Every group health care service plan contract, except for a specialized 
health care service plan contract, that is issued, amended, renewed, or delivered on 
 
(footnote continued on next page) 
 
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(footnote continued from previous page) 
 
or after January 1, 2000, and every individual health care service plan contract that 
is amended, renewed, or delivered on or after January 1, 2000, except for a 
specialized health care service plan contract, shall provide coverage for the 
following, under general terms and conditions applicable to all benefits: 
 
“(1) A health care service plan contract that provides coverage for 
outpatient prescription drug benefits shall include coverage for a variety of federal 
Food and Drug Administration approved prescription contraceptive methods 
designated by the plan.  In the event the patient’s participating provider, acting 
within his or her scope of practice, determines that none of the methods designated 
by the plan is medically appropriate for the patient’s medical or personal history, 
the plan shall also provide coverage for another federal Food and Drug 
Administration approved, medically appropriate prescription contraceptive method 
prescribed by the patient’s provider. 
 
“(2) Outpatient prescription benefits for an enrollee shall be the same for an 
enrollee’s covered spouse and covered nonspouse dependents. 
 
“(b) Notwithstanding any other provision of this section, a religious 
employer may request a health care service plan contract without coverage for 
federal Food and Drug Administration approved contraceptive methods that are 
contrary to the religious employer’s religious tenets.  If so requested, a health care 
service plan contract shall be provided without coverage for contraceptive 
methods. 
 
“(1) For purposes of this section, a ‘religious employer’ is an entity for 
which each of the following is true: 
 
“(A) The inculcation of religious values is the purpose of the entity. 
 
“(B) The entity primarily employs persons who share the religious tenets of 
the entity. 
 
“(C) The entity serves primarily persons who share the religious tenets of 
the entity. 
 
“(D) The entity is a nonprofit organization as described in Section 
6033(a)(2)(A)i or iii, of the Internal Revenue Code of 1986, as amended. 
 
“(2) Every religious employer that invokes the exemption provided under 
this section shall provide written notice to prospective enrollees prior to 
enrollment with the plan, listing the contraceptive health care services the 
employer refuses to cover for religious reasons. 
 
“(c) Nothing in this section shall be construed to exclude coverage for 
prescription contraceptive supplies ordered by a health care provider with 
prescriptive authority for reasons other than contraceptive purposes, such as 
decreasing the risk of ovarian cancer or eliminating symptoms of menopause, or 
 
(footnote continued on next page) 
 
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Plaintiff Catholic Charities of Sacramento, Inc. (hereafter Catholic 
Charities) is a California nonprofit public benefit corporation.  (See Corp. Code, 
§ 5110 et seq.)  Although independently incorporated, Catholic Charities describes 
itself as “operated in connection with the Roman Catholic Bishop of Sacramento” 
and as “an organ of the Roman Catholic Church.”  The nonprofit corporation 
“offer[s] a multitude of social services and private welfare programs to the general 
public, as part of the social justice ministry of the Roman Catholic Church.”  
These services and programs include “providing immigrant resettlement programs, 
elder care, counseling, food, clothing and affordable housing for the poor and 
needy, housing and vocational training of the developmentally disabled and the 
like.”   
Catholic Charities offers health insurance, including prescription drug 
coverage, to its 183 full-time employees through group health care plans 
underwritten by Blue Shield of California and Kaiser Permanente.  Catholic 
Charities does not, however, offer insurance for prescription contraceptives 
because it considers itself obliged to follow the Roman Catholic Church’s 
                                                                                                                                                              
 
(footnote continued from previous page) 
 
for prescription contraception that is necessary to preserve the life or health of an 
enrollee. 
 
“(d) Nothing in this section shall be construed to deny or restrict in any way 
the [D]epartment[ of Managed Care’s] authority to ensure plan compliance with 
this chapter when a plan provides coverage for prescription drugs. 
 
“(e) Nothing in this section shall be construed to require an individual or 
group health care services plan to cover experimental or investigational 
treatments.” 
 
 
4  
Insurance Code section 10123.196 is essentially the same as Health and 
Safety Code section 1367.26 (see fn. 3, ante), except that it regulates disability 
insurance policies instead of health care service plan contracts.  For the sake of 
convenience, subsequent references to the WCEA will include only the Health and 
Safety Code. 
 
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religious teachings, because the Church considers contraception a sin, and because 
Catholic Charities believes it cannot offer insurance for prescription 
contraceptives without improperly facilitating that sin.   
As mentioned, the WCEA permits a “religious employer” to offer 
prescription drug insurance without coverage for contraceptives that violate the 
employer’s religious tenets.  (Health & Saf. Code, § 1367.25, subd. (b).)  The act 
defines a “religious employer” as “an entity for which each of the following is 
true:  [¶]  (A) The inculcation of religious values is the purpose of the entity.  [¶]  
(B) The entity primarily employs persons who share the religious tenets of the 
entity.  [¶]  (C) The entity serves primarily persons who share the religious tenets 
of the entity.  [¶]  (D) The entity is a nonprofit organization as described in Section 
6033(a)(2)(A)i or iii, of the Internal Revenue Code of 1986, as amended.”  (Ibid.)  
The cited provisions of the Internal Revenue Code exempt, from the obligation to 
file an annual return, “churches, their integrated auxiliaries, and conventions or 
associations of churches” (26 U.S.C. § 6033(a)(2)(A)(i)) and “the exclusively 
religious activities of any religious order” (id., § 6033(a)(2)(A)(i) and (iii)). 
Catholic Charities does not qualify as a “religious employer” under the 
WCEA because it does not meet any of the definition’s four criteria.  (See Health 
& Saf. Code, § 1367.25, subd. (b)(1)(A)-(D).)  The organization candidly 
acknowledges this in its complaint, offering the following explanation:  “The 
corporate purpose of Catholic Charities is not the direct inculcation of religious 
values.  Rather, [its] purpose . . . is to offer social services to the general public 
that promote a just, compassionate society that supports the dignity of individuals 
and families, to reduce the causes and results of poverty, and to build healthy 
communities through social service programs such as counseling, mental health 
and immigration services, low-income housing, and supportive social services to 
the poor and vulnerable.  Further, Catholic Charities does not primarily employ 
 
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persons who share its Roman Catholic religious beliefs, but, rather, employs a 
diverse group of persons of many religious backgrounds, all of whom share [its] 
Gospel-based commitment to promote a just, compassionate society that supports 
the dignity of individuals and families.  Moreover, Catholic Charities serves 
people of all faith backgrounds, a significant majority of [whom] do not share [its] 
Roman Catholic faith.  Finally, . . . Catholic Charities, although an exempt 
organization under 26 U.S.C. § 501(c)(3), is not a nonprofit organization pursuant 
to [s]ection 6033(a)(2)(A)(i) or (iii) of the Internal Revenue Code of 1986.  
Consequently, . . .  Catholic Charities is not entitled . . . to an exemption from the 
mandate imposed by [the WCEA].”   
As mentioned, the WCEA implicitly permits any employer to avoid 
covering contraceptives by not offering coverage for prescription drugs.  But this 
option, according to Catholic Charities, does not eliminate all conflict between the 
law and its religious beliefs.  Catholic Charities feels obliged to offer prescription 
drug insurance to its employees under what it describes as the “Roman Catholic 
religious teaching” that “an employer has a moral obligation at all times to 
consider the well-being of its employees and to offer just wages and benefits in 
order to provide a dignified livelihood for the employee and his or her family.”   
Perceiving no option consistent with both its beliefs and the law, Catholic 
Charities filed this action seeking a declaratory judgment that the WCEA is 
unconstitutional and an injunction barring the law’s enforcement.  Defendants are 
the State of California, the Department of Managed Health Care and the 
Department of Insurance.5  Catholic Charities’ challenges to the WCEA arise 
                                              
5  
The Department of Managed Health Care regulates health care service 
plans.  (Health & Saf. Code, § 1341 et seq.)  The Department of Insurance and the 
Insurance Commissioner regulate disability insurance policies.  (See id., § 1343, 
subd. (e)(1), and Ins. Code, § 10290 et seq.) 
 
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under the establishment and free exercise clauses of the United States and 
California Constitutions.  (U.S. Const., 1st Amend.; Cal. Const., art. I, § 4.)  The 
superior court, finding no reasonable likelihood that Catholic Charities would 
prevail on the merits, denied its motion for a preliminary injunction.  Catholic 
Charities sought review of this ruling by petition for writ of mandate, which the 
Court of Appeal denied.  We granted review of the Court of Appeal’s decision. 
II.  DISCUSSION 
Catholic Charities, in its brief to this court, asserts eight constitutional 
challenges to the WCEA.  All refer to the religion clauses of the federal and state 
Constitutions.  (U.S. Const., 1st Amend.; Cal. Const., art. I, § 4.)  Catholic 
Charities begins with a set of three arguments to the effect that the WCEA 
impermissibly interferes with the autonomy of religious organizations.  (See p. 7 et 
seq., post.)  Next, Catholic Charities claims the WCEA impermissibly burdens its 
right of free exercise.  As part of this claim, Catholic Charities offers four 
arguments for subjecting the WCEA to strict scrutiny, despite the United States 
Supreme Court’s holding that the right of free exercise does not excuse 
compliance with neutral, generally applicable laws.  (Employment Div., Ore. Dept. 
of Human Res. v. Smith (1990) 494 U.S. 872, 876-890; see p. 16 et seq., post.)  
Finally, Catholic Charities contends the WCEA fails even the rational basis test.  
(See p. 44 et seq., post.) 
A. Religious Autonomy 
1. Interference with matters of religious doctrine and internal church 
governance 
Catholic Charities contends the WCEA impermissibly interferes with 
matters of religious doctrine and internal church governance.  In support of the 
contention, Catholic Charities invokes the rule that the state must accept the 
decision of appropriate church authorities on such matters.  This is the rule of the 
so-called church property cases.  (E.g., Serbian Orthodox Diocese v. Milivojevich 
 
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(1976) 426 U.S. 696, 708-709; Presbyterian Church v. Hull Church (1969) 393 
U.S. 440, 445-449; Kreshik v. St. Nicholas Cathedral (1960) 363 U.S. 190, 191; 
Kedroff v. St. Nicholas Cathedral (1952) 344 U.S. 94, 109-121; Gonzalez v. 
Archbishop (1929) 280 U.S. 1, 16-17; Watson v. Jones (1871) 80 U.S. 679, 727.)  
That rule does not dispose of this case. 
The first church property case to reach the United States Supreme Court, 
Watson v. Jones, supra, 80 U.S. 679 (Watson), articulates the rule and illustrates 
its proper application.  The case arose from a schism in the Presbyterian Church 
during the Civil War.  When the church’s national governing body, the General 
Assembly, expressed its opposition to slavery, various congregations responded by 
declaring the General Assembly’s view heretical and renouncing that body’s 
authority.  The General Assembly, in turn, dissolved the schismatic congregations.  
Civil disputes ensued between rival congregations, each asserting a religious claim 
to be the only true congregation entitled to use certain local church property.  The 
high court resolved the competing religious claims by deferring to the decision of 
the General Assembly, thus adopting the rule still in effect today:  “[W]henever 
. . . questions of discipline, or of faith, or ecclesiastical rule, custom, or law have 
been decided by the highest of [the] church judicatories to which the matter has 
been carried, the legal tribunals must accept such decisions as final, and as binding 
on them, in their application to the case before them.”  (Id., at p. 727.)  The rule’s 
modern formulation is similar.  (Serbian Orthodox Diocese v. Milivojevich, supra, 
426 U.S. 696, 709.) 
The high court in Watson, supra, 80 U.S. 679, offered two reasons for 
deferring to religious authorities on religious questions.  The first justification was 
that civil courts are simply “incompetent” to decide matters of faith and doctrine.  
(Id., at p. 732.)  Courts have no expertise in religious matters, and courts “so 
unwise” as to attempt to decide them “would only involve themselves in a sea of 
 
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uncertainty and doubt . . . .”  (Ibid.; see also Serbian Orthodox Diocese v. 
Milivojevich, supra, 426 U.S. 696, 714-715 & fn. 8.)  The second reason was that 
the members of a church, by joining, implictly consent to the church’s governance 
in religious matters; for civil courts to review the church’s judgments would 
“deprive these bodies of the right of construing their own church laws” (Watson, at 
pp. 733-734; see also id., at pp. 728-729) and, thus, impair the right to form 
voluntary religious organizations (id., at pp. 728-729; cf. Serbian Orthodox 
Diocese v. Milivojevich, supra, at pp. 724-725).   
Because Watson, supra, 80 U.S. 679, preceded the First Amendment’s 
incorporation into the Fourteenth, the court did not base its decision on the 
Constitution.  In subsequent cases, however, the court described Watson’s 
reasoning as having a “ ‘clear constitutional ring’ ” (Serbian Orthodox Diocese v. 
Milivojevich, supra, 426 U.S. 696, 710, quoting Presbyterian Church v. Hull 
Church, supra, 393 U.S. 440, 446; cf. Watson, at pp. 728-729) and Watson’s 
holding as compelled by the religion clauses of the First Amendment (Serbian 
Orthodox Diocese v. Milivojevich, supra, at pp. 724-725; Kedroff v. St. Nicholas 
Cathedral, supra, 344 U.S. 94, 115-116; see also Employment Div., Ore. Dept. of 
Human Res. v. Smith, supra, 494 U.S. 872, 877).  The high court has also held that 
legislatures are bound by the same constitutional limitations Watson articulated for 
the courts.  (Kedroff v. St. Nicholas Cathedral, supra, at pp. 117-121.)   
Catholic Charities asserts that the Legislature, in enacting the WCEA, 
violated the rule of church property cases by interfering with matters of internal 
church governance and by rejecting the Catholic Church’s decision that 
prescription contraceptives are sinful.  These assertions are incorrect.  This case 
does not implicate internal church governance; it implicates the relationship 
between a nonprofit public benefit corporation and its employees, most of whom 
do not belong to the Catholic Church.  Only those who join a church impliedly 
 
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consent to its religious governance on matters of faith and discipline.  (Watson, 
supra, 80 U.S. 679, 729.)  Certainly the WCEA conflicts with Catholic Charities’ 
religious beliefs, but this does not mean the Legislature has decided a religious 
question.  Congress has created, and the high court has resolved, similar conflicts 
between employment law and religious beliefs without deciding religious 
questions and without reference to the church property cases.  (E.g., Tony and 
Susan Alamo Foundation v. Sec’y of Labor (1985) 471 U.S. 290, 303-306 
[religious organization must comply with federal minimum wage laws]; United 
States v. Lee (1982) 455 U.S. 252, 256-261 [Amish employer must pay Social 
Security and unemployment taxes].)  Neither does this case require us to decide 
any religious questions.  Instead, we need only apply the usual rules for assessing 
whether state-imposed burdens on religious exercise are constitutional.  (See 
Church of Lukumi Babalu Aye, Inc. v. Hialeah (1993) 508 U.S. 520, 531-533; 
Employment Div., Ore. Dept. of Human Res. v. Smith, supra, 494 U.S. 872, 876-
882.)  This we do below, in the context of Catholic Charities’ separate claims 
under the free exercise clause.  (See p.16 et seq., post.)   
Catholic Charities also argues the Legislature, by enacting the WCEA, 
deliberately intervened in a conflict within the Catholic Church on the side of 
those who disagree with the Church’s teachings on contraception.  In support of 
the argument, Catholic Charities notes that one of WCEA’s sponsors cited, on the 
floor of the state Senate, a New York Times poll suggesting that not all Catholic 
women accept the Church’s teachings on contraception, and that “someone who 
practices artificial birth control can still be a good Catholic.”  Commenting on the 
poll, the senator said, “I agree with that.  I think it’s time to do the right thing.”  
Certainly the state may not “lend its power to one or the other side in controversies 
over religious authority or dogma . . . .”  (Employment Div., Ore. Dept. of Human 
Res. v. Smith, supra, 494 U.S. 872, 877.)  However, the Legislature’s motivation 
 
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cannot reliably be inferred from a single senator’s remarks.  Other legislators who 
voted to enact the WCEA might well have done so because they wished to reduce 
the inequitable financial burden of health care on women, without regard to any 
religious dispute over the propriety of artificial contraception. 
While the church property cases thus do not invalidate the WCEA, the 
constitutional principles that underlie those cases may place an outer limit on the 
statute’s constitutional application.  Relying on the church property cases, lower 
federal courts have held that the First Amendment bars courts from reviewing 
employment decisions by religious organizations affecting employees with the 
religious duties of ministers.  (McClure v. Salvation Army (5th Cir. 1972) 460 F.2d 
553, 558-561; see also Gellington v. Christian Methodist Episcopal Church (11th 
Cir. 2000) 203 F.3d 1299, 1301-1304; Combs v. Cen Tx Ann Conf United 
Methodist Church (5th Cir. 1999) 173 F.3d 343, 345-350.)  The rule that emerges 
from these decisions is sometimes called the “ministerial exception,” because it 
operates as a nonstatutory, constitutionally compelled exception to title VII of the 
Civil Rights Act of 1964.  (42 U.S.C. § 2000e et seq., hereafter title VII.)    
The Fifth Circuit first recognized the ministerial exception in McClure v. 
Salvation Army, supra, 460 F.2d 553.  The plaintiff, a former officer of the 
Salvation Army, alleged that her termination was motivated by sex discrimination 
violating title VII.  To avoid doubts about title VII’s constitutionality as applied to 
religious organizations, the court construed the law as not governing the 
relationship between a church and its ministers.  Judicial review of a minister’s 
salary and duties, the court reasoned, would “intrude upon matters of church 
administration and government which have so many times before been proclaimed 
to be matters of a singular ecclesiastical concern.”  (McClure v. Salvation Army, 
supra, at p. 560.)  Although the United States Supreme Court has not spoken on 
the ministerial exception, the lower federal courts have widely embraced it, 
 
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applying it both to ministers and to a variety of nonordained employees with 
duties functionally equivalent to those of ministers.  (E.g., Alicea-Hernandez v. 
Catholic Bishop of Chicago (7th Cir. 2003) 320 F.3d 698, 700-704 [Hispanic 
communications manager for Archdiocese of Chicago, responsible for “shaping 
the message that the Church presented to the Hispanic community”]; E.E.O.C. v. 
Roman Catholic Diocese of Raleigh, NC (4th Cir. 2000) 213 F.3d 795, 802-805 
[cathedral choir director required to assist in planning liturgies]; E.E.O.C. v. 
Catholic University of America (D.C. Cir. 1996) 83 F.3d 455, 461 [professor of 
canon law at religious university].)   
Because the case before us does not involve title VII, the ministerial 
exception as currently articulated does not apply.  Although the constitutional 
reasoning underlying the ministerial exception might bar the State from applying 
the WCEA to ministers or clergy employed by a bona fide religious organization 
that for whatever reason did not qualify under the act’s exemption for religious 
organizations (Health & Saf. Code, § 1367.25, subd. (b); cf. Schmoll v. Chapman 
University (1999) 70 Cal.App.4th 1434, 1438-1444 [recognizing a ministerial 
exception to the Cal. Fair Employment and Housing Act, Gov. Code, § 12900 et 
seq.]), we need not decide the question because Catholic Charities does not claim 
that any of its employees have the religious duties of ministers.  Indeed, as noted 
above, most are not even members of the Catholic Church.  In short, the 
ministerial exception does not dispose of this case.  Catholic Charities 
acknowledges as much.   
2. Distinction between religious and secular activities 
Catholic Charities next argues that the First Amendment forbids the 
government to “premis[e] a religious institution’s eligibility for an exemption from 
government regulation upon whether the activities of the institution are deemed by 
the government to be ‘religious’ or ‘secular’ . . . .”  The argument is directed 
 
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against the four statutory criteria an employer must satisfy to claim exemption 
from the WCEA as a “religious employer.”  (Health & Saf. Code, § 1367.25, subd. 
(b)(1)(A)-(D); see p. 5, ante.)  The argument lacks merit.   
The exception to the WCEA accommodates religious exercise by relieving 
statutorily defined “religious employers” (Health & Saf. Code, § 1367.25, subd. 
(b)) of the burden of paying for contraceptive methods that violate their religious 
beliefs.  The United States Supreme Court has long recognized that the alleviation 
of significant governmentally created burdens on religious exercise is a 
permissible legislative purpose that does not offend the establishment clause.  
(Corporation of Presiding Bishop v. Amos (1978) 483 U.S. 327, 334-335; Hobbie 
v. Unemployment Appeals Comm’n of Fla. (1987) 480 U.S. 136, 144-145; cf. 
Employment Div., Ore. Dept. of Human Res. v. Smith, supra, 494 U.S. 872, 890.)  
Such legislative accommodations would be impossible as a practical matter if the 
government were, as Catholic Charities argues, forbidden to distinguish between 
the religious entities and activities that are entitled to accommodation and the 
secular entities and activities that are not.   In fact, Congress and the state 
legislatures have drawn such distinctions for this purpose, and laws embodying 
such distinctions have passed constitutional muster.  (E.g., Corporation of 
Presiding Bishop v. Amos, supra, 483 U.S. 327, 334-340 [upholding statutory 
exemption of “religious” employers from liability for religious discrimination; 42 
U.S.C. § 2000e-1(a)]; East Bay Asian Local Development Corp. v. State of 
California (2000) 24 Cal.4th 693, 704-718 [upholding state laws exempting 
“religiously affiliated” organizations from landmark preservation laws, Gov. 
Code, §§ 25373, subds. (c) & (d), 37361, subd. (c)].)   
Catholic Charities’ argument to the contrary largely depends on a single 
lower federal court decision, Espinosa v. Rusk (10th Cir. 1980) 634 F.2d 477 
(Espinosa).  In that case, the court invalidated an antisolicitation ordinance 
 
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because, among other things, it “involve[d] municipal officials in the definition of 
what is religious.”  (Id., at p. 481.)  But whatever Espinosa might purport to hold, 
the decision could not supersede the United States Supreme Court’s repeated 
holding that the government may constitutionally exempt religious organizations 
from generally applicable laws in order to alleviate significant governmentally 
imposed burdens on religious exercise.  (Corporation of Presiding Bishop v. 
Amos, supra, 483 U.S. 327, 334-335; Hobbie v. Unemployment Appeals Comm’n 
of Fla., supra, 480 U.S. 136, 144-145; Employment Div., Ore. Dept. of Human 
Res. v. Smith, supra, 494 U.S. 872, 890.)  In any event, the court in Espinosa 
addressed the different problem of content-based prior restraints on speech.  The 
court struck down an ordinance that gave municipal officials, in effect, the power 
to decide in advance which messages the city’s residents would be permitted to 
hear by requiring the officials, before granting a permit, to determine that the 
applicant’s purpose for soliciting funds was truly religious.  The ordinance thus 
violated Cantwell v. Connecticut (1940) 310 U.S. 296, 305-307, which permits the 
government to regulate the time, place and manner of religious solicitations but 
not to censor them altogether based on an assessment of the content of speech.  
(Espinosa, at pp. 480-482.)  The WCEA, which places no restrictions on speech, 
does not present the problem addressed in Cantwell v. Connecticut and Espinosa. 
Our conclusion that the government may properly distinguish between 
secular and religious entities and activities for the purpose of accommodating 
religious exercise does not mean that any given statute purporting to draw such 
distinctions necessarily passes muster under the free exercise clause.  “[A] law 
targeting religious beliefs as such is never permissible,” and a court “ ‘must survey 
meticulously the circumstances of governmental categories to eliminate, as it 
were, religious gerrymanders.’ ”  (Church of Lukumi Babalu Aye, Inc. v. Hialeah, 
supra, 508 U.S. 520, 533-534, quoting Walz v. Tax Commission (1970) 397 U.S. 
 
14

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664, 696 (conc. opn. of Harlan, J.).)  We address below Catholic Charities’ 
separate argument that the WCEA’s definition of “religious employer” in fact 
embodies a legislative effort to target Catholic organizations for unfavorable 
treatment.  (See p. 23 et seq., post.) 
3. Excessive entanglement 
Catholic Charities contends that the WCEA’s exemption for “religious 
employer[s]” (Health & Saf. Code, § 1367.25, subd. (b)) violates the establishment 
clause by mandating an entangling inquiry into the employer’s religious purpose 
and into its employees’ and clients’ religious beliefs.  The argument refers to the 
first three of the four statutory criteria for identifying a “religious employer,” 
namely, whether “[t]he inculcation of religious values is the purpose of the entity” 
(id., subd. (b)(1)(A)), whether “[t]he entity primarily employs persons who share 
the religious tenets of the entity” (id., subd. (b)(1)(B)), and whether “[t]he entity 
serves primarily persons who share the religious tenets of the entity” (id., subd. 
(b)(1)(C)).  A law that fosters an excessive governmental entanglement with 
religion can for that reason violate the establishment clause.  (Lemon v. Kurtzman 
(1971) 403 U.S. 602, 612-613.) 6  Moreover, recent judicial opinions have 
criticized rules and laws that invite official “trolling through a person’s or 
institution’s religious beliefs.”  (Mitchell v. Helms (2000) 530 U.S. 793, 828 (plur. 
opn. of Thomas, J.); University of Great Falls v. N.L.R.B. (D.C. Cir. 2002) 278 
F.3d 1335, 1342-1348.) 
                                              
6  
The court in Lemon v. Kurtzman, supra, 403 U.S. 602, “gleaned from [its 
prior] cases” three tests for determining whether a statute violates the 
establishment clause:  “First, the statute must have a secular legislative purpose; 
second its principal or primary effect must be one that neither advances nor 
inhibits religion . . . ; finally, the statute must not foster ‘an excessive 
governmental entanglement with religion.’ ”  (Id., at pp. 612-613, quoting Walz v. 
Tax Commission, supra, 397 U.S. 664, 674.) 
 
15

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The argument might have merit as applied to a hypothetical employer that 
sought to qualify under the WCEA’s exemption for religious employers (Health & 
Saf. Code, § 1367.25, subd. (b)) but objected on establishment clause grounds to 
an entangling official effort to verify that its purpose was the inculcation of 
religious values, and that it primarily employed and served persons who shared its 
religious tenets.  But Catholic Charities candidly alleges in its complaint that it 
does not qualify under the exemption because it does not satisfy any of the four 
criteria.  More specifically, Catholic Charities concedes that its purpose is not the 
inculcation of religious values, that it does not primarily hire and serve Catholics, 
and that it does not fall within either of the relevant provisions of the Internal 
Revenue Code (26 U.S.C. § 6033(a)(2)(A)(i) and (iii), cited in Health & Saf. 
Code, § 1367.25, subd. (b)(1)(D)).  Consequently, no entangling inquiry into 
Catholic Charities’ purpose or beliefs, or the beliefs of its employees and clients, 
has occurred or is likely to occur.  Therefore, even if in some other case the statute 
might require an entangling inquiry, in this case, as applied to Catholic Charities, 
the establishment clause offers no basis for holding the statute unconstitutional. 
B.  Free Exercise of Religion 
Catholic Charities argues the WCEA violates the free exercise clauses of 
the federal and state Constitutions (U.S. Const., 1st Amend.; Cal. Const., art. I, 
§ 4) by coercing the organization to violate its religious beliefs, in that the WCEA, 
by regulating the content of insurance policies, in effect requires employers who 
offer their workers insurance for prescription drugs to offer coverage for 
prescription contraceptives.  Catholic Charities wishes to offer insurance, but may 
not facilitate the use of contraceptives without violating its religious beliefs. 
Any analysis of Catholic Charities’ free exercise claim must take into 
consideration the United States Supreme Court’s decision in Employment Div., 
Ore. Dept. of Human Res. v. Smith, supra, 494 U.S. 872 (Smith).  In Smith, the 
 
16

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high court articulated the general rule that religious beliefs do not excuse 
compliance with otherwise valid laws regulating matters the state is free to 
regulate.  (Id., at pp. 877-882.)  The government may not regulate religious beliefs 
as such by compelling or punishing their affirmation.  (Id., at p. 877.)  Nor may it 
target conduct for regulation only because it is undertaken for religious reasons.  
(Ibid.)   But “the right of free exercise does not relieve an individual of the 
obligation to comply with a ‘valid and neutral law of general applicability on the 
ground that the law proscribes (or prescribes) conduct that his religion prescribes 
(or proscribes).’ ”  (Smith, at p. 879, quoting United States v. Lee, supra, 455 U.S. 
252, 263, fn. 3 (conc. opn. of Stevens, J.).)  To permit religious beliefs to excuse 
acts contrary to law, the Smith court reasoned, “ ‘would be to make the professed 
doctrines of religious belief superior to the law of the land, and in effect to permit 
every citizen to become a law unto himself.’ ”  (Smith, at p. 879, quoting Reynolds 
v. United States (1879) 98 U.S. 145, 167.)   
Before Smith, supra, 494 U.S. 872, the high court had taken a variety of 
approaches to assessing the constitutionality of laws claimed to burden the free 
exercise of religion.  In some cases, notably Sherbert v. Verner (1963) 374 U.S. 
398, 403-409 (Sherbert) and Wisconsin v. Yoder (1972) 406 U.S. 205, 220-229, 
the court had examined such laws under strict scrutiny, reasoning that a law 
substantially burdening religious practice must be narrowly tailored to serve a 
compelling state interest.  In other cases, both before and after Sherbert, the court 
had upheld laws and governmental actions challenged under the free exercise 
clause without applying strict scrutiny.7   
                                              
7  
Lyng v. Northwest Indian Cemetery Prot. Assn. (1988) 485 U.S. 439 
(Native American free exercise challenge to governmental logging and road 
construction activities); O’Lone v. Estate of Shabazz (1987) 482 U.S. 342 (prison 
regulations); Goldman v. Weinberger (1986) 475 U.S. 503 (military dress 
regulations); Gillette v. United States (1971) 401 U.S. 437 (selective service law); 
 
(footnote continued on next page) 
 
17

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Eight years before Smith, supra, 494 U.S. 872, Justice Stevens wrote that 
most of the court’s holdings were better explained not by the strict scrutiny test of 
Sherbert, supra, 374 U.S. 398, as by “a standard that places an almost 
insurmountable burden on any individual who objects to a valid and neutral law of 
general applicability on the ground that the law proscribes (or prescribes) conduct 
that his religious prescribes (or proscribes) . . . .”  (United States v. Lee, supra, 455 
U.S. 252, 263, fn. 3 (conc. opn. of Stevens, J.).)  After Lee, the court again upheld 
laws claimed to burden free exercise, either without mentioning Sherbert, or while 
mentioning Sherbert but declining to apply its test.8  This inconsistency ended 
with Smith, in which the high court repudiated the Sherbert test and expressly 
adopted the standard Justice Stevens had articulated.  (Smith, at pp. 879, 882-890.)  
More recently, the court has reaffirmed Smith and reiterated “the general 
proposition that a law that is neutral and of general applicability need not be 
justified by a compelling government interest even if the law has the incidental 
                                                                                                                                                              
 
(footnote continued from previous page) 
 
Braunfeld v. Brown (1961) 366 U.S. 599 (Sunday closing law); Prince v. 
Massachusetts (1944) 321 U.S. 158 (child labor law); Jacobson v. Massachusetts 
(1905) 197 U.S. 11 (compulsory vaccination law); Reynolds v. United States, 
supra, 98 U.S. 145 (polygamy law).   
8  
Lyng v. Northwest Indian Cemetery Prot. Assn., supra, 485 U.S. 439, 450-
453; O’Lone v. Estate of Shabazz, supra, 482 U.S. 342, 348-353; Goldman v. 
Weinberger, supra, 475 U.S. 503, 506-510.   
 In 
Bowen v. Roy (1986) 476 U.S. 693, the high court did not decide whether 
the free exercise clause barred the federal government from requiring Native 
American welfare applicants, over their religious objections, to provide Social 
Security numbers.  In separate opinions, six justices expressed the view that 
Sherbert would govern the question.  (Id., at pp. 715-716 (opn. of Blackmun, J., 
conc. in part); id., at p. 722 & fn. 17 (opn. of Stevens, J., conc. in part); id., at 
p. 728 (opn. of O’Connor, J., conc. in part, with Brennan and Marshall, JJ., conc.); 
id., at p. 733 (dis. opn. of White, J.).)  Three justices disagreed.  (Id., at p. 708 
(plur. opn. of Burger, C.J., with Powell and Rehnquist, JJ., conc.).) 
 
18

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effect of burdening a particular religious practice.”  (Church of Lukumi Babalu 
Aye, Inc. v. Hialeah, supra, 508 U.S. 520, 531.) 
The general rule affirmed in Smith, supra, 494 U.S. 872, would at first 
glance appear to dispose of Catholic Charities’ free exercise claim.  The WCEA’s 
requirements apply neutrally and generally to all employers, regardless of 
religious affiliation, except to those few who satisfy the statute’s strict 
requirements for exemption on religious grounds.  (Health & Saf. Code, 
§ 1367.25, subd. (b).)  The act also addresses a matter the state is free to regulate; 
it regulates the content of insurance policies for the purpose of eliminating a form 
of gender discrimination in health benefits.  The act conflicts with Catholic 
Charities’ religious beliefs only incidentally, because those beliefs happen to make 
prescription contraceptives sinful.  Accordingly, it appears Catholic Charities may 
successfully challenge the WCEA only by demonstrating an exception to the 
general rule.   
To demonstrate an exception to the general rule is, in fact, precisely what 
Catholic Charities seeks to do.  On four separate grounds, Catholic Charities 
argues we should examine the WCEA under strict scrutiny despite the holding of 
Smith, supra, 494 U.S. 872.  Specifically, Catholic Charities argues that the 
WCEA is not neutral and generally applicable (see Church of Lukumi Babalu Aye, 
Inc. v. Hialeah, supra, 508 U.S. 520, 533-547), that it constitutes a religious 
“gerrymander” (see id., at p. 534), and that it violates so-called hybrid rights (cf. 
Smith, supra, 494 U.S. at pp. 881-882).  Finally, Catholic Charities argues that the 
California Constitution requires us to apply strict scrutiny in any event, and that 
the WCEA fails that test.  We address each of these arguments below. 
1. Neutrality and general applicability 
Catholic Charities offers two arguments why the WCEA should be not 
considered neutral or generally applicable and should, thus, be subject to strict 
 
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scrutiny under an exception to the rule of Smith, supra, 494 U.S. 872.  First, 
Catholic Charities contends the face of the statute demonstrates a lack of 
neutrality; second, Catholic Charities relies on the WCEA’s legislative history and 
practical effect to argue the Legislature “gerrymandered” the law to reach only 
Catholic employers.  We address these arguments separately, as Catholic Charities 
has stated them in its brief.   
A law is not neutral towards religion if its “object . . . is to infringe upon or 
restrict practices because of their religious motivation . . . .”  (Church of Lukumi 
Babalu Aye, Inc. v. Hialeah, supra, 508 U.S. 520, 533 (Lukumi).)  A law is not 
generally applicable if it “in a selective manner impose[s] burdens only on conduct 
motivated by religious belief . . . .”  (Id., at p.  543.)  Thus, “[n]eutrality and 
general applicability are interrelated, and . . . [a] failure to satisfy one requirement 
is a likely indication that the other has not been satisfied.”  (Id., at p. 531.)   
In determining whether the object of a law is to suppress religion or 
religiously motivated conduct, a court “must begin with [the law’s] text, for the 
minimum requirement of neutrality is that a law not discriminate on its face.  A 
law lacks facial neutrality if it refers to a religious practice without a secular 
meaning discernable from the language or context.”  (Lukumi, supra, 508 U.S. 
520, 533.)  Following this approach, the high court in Lukumi found that a city 
council’s use of the words “sacrifice” and “ritual” in an ordinance regulating 
animal slaughter helped to show, together with other evidence, that the ordinance 
had been motivated by a desire to suppress the Santeria religion.  The lack of 
facial neutrality fit into a “pattern” of “animosity to Santeria adherents and their 
religious practices . . . .”  (Id., at p. 542.)  Not only did “the ordinances by their 
own terms target [Santeria] religious exercise,” so too were “the texts of the 
ordinances . . . gerrymandered with care to proscribe religious killings of animals 
but to exclude almost all secular killings . . . .”  (Ibid.)  Finally, “the ordinances 
 
20

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suppress[ed] much more religious conduct than [was] necessary in order to 
achieve the legitimate ends asserted in their defense [i.e., protecting health and 
preventing cruelty to animals].”  (Ibid.)   
Relying on Lukumi, supra, 508 U.S. 520, Catholic Charities argues the 
WCEA is not neutral because its exemption for religious employers contains 
religious terms and terminology that lack any secular meaning or purpose.  
Catholic Charities specifically refers to the terms “inculcation of religious values” 
and “religious tenets,” both of which appear in criteria used in the WCEA to 
define and exempt “religious employer[s].”  (Health & Saf. Code, § 1367.25, subd. 
(b)(1)(A), (B) & (C).)   
Lukumi, supra, 508 U.S. 520, is inapposite.  The animal sacrifice ordinance 
challenged in that case referred to religious practices (“sacrifice” and “ritual”) in 
order to prohibit them.  In that context, the statute’s use of religious terminology 
supported the court’s conclusion “that suppression of the central element of the 
Santeria worship service was the object of the ordinances” there at issue.  (Id., at 
p. 534.)  In contrast, the WCEA refers to the religious characteristics of 
organizations in order to identify and exempt those organizations from an 
otherwise generally applicable duty.  Although Catholic Charities cannot claim the 
statutory exemption for religious employers, other Catholic organizations may be 
able to claim it.  If the WCEA burdens Catholic Charities’ religious beliefs, the 
burden arises not from the religious terminology used in the exemption, but from 
the generally applicable requirement to provide coverage for contraceptives.  The 
high court has never prohibited statutory references to religion for the purpose of 
accommodating religious practice.  To the contrary, the court has repeatedly 
indicated that “it is a permissible legislative purpose to alleviate significant 
governmental interference with the ability of religious organizations to define and 
carry out their religious missions.”  (Corporation of Presiding Bishop v. Amos, 
 
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supra, 483 U.S. 327, 335 (Amos); see also Hobbie v. Unemployment Appeals 
Comm’n of Fla., supra, 480 U.S. 136, 144-145; cf. Smith, supra, 494 U.S. 872, 
890.)  Furthermore, the state may require an organization “claiming the benefits of 
[a] religious-organization exemption” from a regulatory statute “to prove that [it] 
is a religious organization within the meaning of the [statute].”  (Larson v. Valente 
(1982) 456 U.S. 228, 255, fn. 30, italics added.)  To accomplish these purposes 
without explicitly defining the religious groups and practices to be accommodated, 
in order to distinguish them from secular groups and practices not entitled to 
accommodation, would often be impossible. 
Because a legislative accommodation benefits religion, it is tested not under 
the free exercise clause but under the establishment clause.  (Amos, supra, 483 
U.S. 327, 334-336.)  To comply with the establishment clause, a law must among 
other things serve a “ ‘secular legislative purpose.’ ”  (Id., at p. 335, quoting 
Lemon v. Kurtzman, supra, 403 U.S. 602, 612.)  In this context, the requirement of 
a secular legislative purpose “does not mean that the law’s purpose must be 
unrelated to religion—that would amount to a requirement ‘that the government 
show a callous indifference to religious groups,’ . . . and the Establishment Clause 
has never been so interpreted.”  (Amos, at p. 335, quoting Zorach v. Clauson 
(1952) 343 U.S. 306, 314.)  Instead, “it is a permissible legislative purpose to 
alleviate significant governmental interference with the ability of religious 
organizations to define and carry out their religious missions.”  (Amos, at p. 335.)  
The references to religion in the WCEA have no other purpose than this.  The high 
court has not “required that legislative categories make no explicit reference to 
religion.”  (Texas Monthly, Inc. v. Bullock (1989) 489 U.S. 1, 10 (plur. opn. of 
Brennan, J.).) 
A rule barring religious references in statutes intended to relieve burdens on 
religious exercise would invalidate a large number of statutes.  A few examples 
 
22

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suffice.  The federal statute upheld in Amos, supra, 483 U.S. 327, for example, 
exempted from title VII of the Civil Rights Act of 1964 “a religious corporation, 
association, or educational institution, or society with respect to the employment 
of individuals of a particular religion to perform work connected with the carrying 
on by such a corporation, association, education institution, or society of its 
activities.”  (42 U.S.C. § 2000e-1(a).)  Similarly, the California Fair Employment 
and Housing Act uses the term “religious association or corporation” (Gov. Code, 
§ 12926, subd. (d)) in order to exempt certain employers from liability for 
unlawful employment practices.  We recently upheld statutes that refer to 
“religiously affiliated” associations and their “religious mission[s]” for the 
purpose of exempting such associations from burdens imposed by a landmark 
preservation ordinance.  (East Bay Asian Local Development Corp. v. State of 
California, supra, 24 Cal.4th 693, 702, quoting Gov. Code, §§ 25373, subd. (d), 
and 37361, subd. (c).)  The rule Catholic Charities proposes would invalidate these 
and many similar laws.  Because the high court’s decisions provide no support for 
such a rule, we reject it.  
2. Religious gerrymander 
Our analysis does not end with the conclusion that the WCEA is facially 
neutral towards religion.  The First Amendment requires more than facial 
neutrality.  It protects against “ ‘subtle departures from neutrality’ ” and 
“governmental hostility which is masked as well as overt.”  (Lukumi, supra, 508 
U.S. 520, 534, quoting Gillette v. United States, supra, 401 U.S. 437, 452.)  Thus, 
a court “ ‘must survey meticulously the circumstances of governmental categories 
to eliminate, as it were, religious gerrymanders.’ ”  (Ibid., quoting Walz v. Tax 
Commission, supra, 397 U.S. 664, 696 (conc. opn. of Harlan, J.).)  Catholic 
Charities argues the Legislature gerrymandered the WCEA to deny the benefit of 
the exemption to Catholic organizations.  The law discriminates, Catholic 
 
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Charities contends, both against the Catholic Church and against religious 
organizations of any denomination that engage in charitable work, as opposed to 
work that is purely spiritual or evangelical.   
We find no merit in the argument that the WCEA discriminates against the 
Catholic Church.  It was at the request of Catholic organizations that the 
Legislature added an exception permitting religious employers to deny coverage 
for “contraceptive methods that are contrary to the religious employer’s religious 
tenets.”  (Health & Saf. Code, § 1367.25, subd. (b).)  Because most religions do 
not object to prescription contraceptives, most religious employers are subject to 
the WCEA.  The Legislature’s decision to grant preferential treatment to religious 
employers who do object is justifiable as an accommodation of religious exercise 
under the principles discussed above.  (Amos, supra, 483 U.S. 327, 334-335.)  
That the exemption is not sufficiently broad to cover all organizations affiliated 
with the Catholic Church does not mean the exemption discriminates against the 
Catholic Church. 9 
We find nothing to the contrary in Larson v. Valente, supra, 456 U.S. 228 
(Larson), the decision on which Catholic Charities principally relies.  The high 
court in Larson held unconstitutional under the establishment clause a Minnesota 
                                              
9  
Indeed, rather than discriminating against the Catholic Church, the WCEA 
can more plausibly be viewed as benefiting the Catholic Church in practical effect, 
since no other religious group opposed to prescription contraceptives has been 
identified.  But the WCEA does not for this reason violate the establishment 
clause.  A law intended not to discriminate among religions but to alleviate a 
governmentally created burden on religious exercise does not necessarily violate 
the establishment clause, even though only a single religion in need of 
accommodation has been identified, if the law is phrased neutrally, to allow for the 
possibility that other as-yet-unidentified religions in need of the same 
accommodation will be able to claim it.  (See, e.g., Kong v. Scully (9th Cir. 2003) 
341 F.3d 1132; Children’s Health. Is A Legal Duty v. Min De Parle (8th Cir. 
2000) 212 F.3d 1084; Droz v. Commissioner of I.R.S. (9th Cir. 1995) 48 F.3d 
1120.)  
 
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statute that discriminated, in effect, against the Reverend Sun Myung Moon’s 
Unification Church.  For many years prior to Larson, Minnesota law had regulated 
charitable solicitations generally but exempted from regulation all solicitations by 
religious organizations.  In 1978, the Minnesota Legislature amended the law to 
exempt only those religious organizations that received more than 50 percent of 
their contributions from members or affiliated organizations.  Minnesota defended 
the exemption as intended to prevent abusive solicitations of the public, reasoning 
that the members of well-established, internally funded churches would exercise 
enough supervision over fund-raising activities to justify dispensing with state 
supervision.  The high court rejected the argument.  In the court’s view, the 50-
percent rule violated “[t]he clearest command of the Establishment Clause,” 
namely, “that one religious denomination cannot be officially preferred over 
another.”  (Id., at p. 244.)  Laws granting denominational preferences must serve 
compelling governmental interests and be closely fitted to further those interests.  
(Id., at pp. 246-247.)  Minnesota’s law failed that test. 
The reasoning of Larson, supra, 456 U.S. 228, does not invalidate the 
WCEA.  The statute invalidated in Larson drew an explicit distinction between 
religious denominations based on their sources of income, and used that 
distinction to impose a regulatory burden only on certain denominations.  In 
contrast, the WCEA applies to religious and nonreligious organizations equally.  
The WCEA confers the special benefit of exemption only on those religious 
organizations whose tenets are opposed to prescription contraceptives and that 
meet the other requirements for exemption.  This benefit, as explained above, is 
justifiable as a legislative accommodation—an effort to alleviate a governmentally 
imposed burden on religious exercise.  (See Amos, supra, 483 U.S. 327, 334-335.)  
Those Catholic employers that do not qualify for exemption are treated precisely 
the same as all other employers in the state, whether religious or nonreligious.  
 
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Thus, while the WCEA may treat some Catholic employers more favorably than 
other employers, the WCEA does not under any circumstance treat Catholic 
employers less favorably than any other employers.  About a law such as this, 
Larson has nothing to say. 10 
Catholic Charities argues the WCEA violates Larson, supra, 456 U.S. 228, 
for the additional reason that the law draws a distinction between religious 
organizations whose purpose is the “inculcation of religious values” (Health & 
Saf. Code, § 1367.25, subd. (b)(1)(A)) and other religious organizations that, in 
Catholic Charities’ words, “have the temerity to engage in ministries other than 
the ‘inculcation of religious values.’ ”  (Italics in original.)  We accept Catholic 
Charities’ assertion that the Catholic Church’s “self-understanding compels it to 
engage in ‘corporal works of mercy,’ which ‘consist especially in feeding the 
hungry, sheltering the homeless, clothing the naked, visiting the sick and 
imprisoned, and burying the dead.’ ”  (Quoting Catechism of the Catholic Church 
(1994) ¶ 2447, p. 588.)  However, to the extent Catholic Charities is arguing the 
                                              
10  
We read Larson, supra, 456 U.S. 228, as condemning laws that 
discriminate among religions or religious denominations.  The law held 
unconstitutional in Larson reflected the Minnesota Legislature’s “express design 
. . . to burden or favor selected religious denominations” (id., at p. 255, italics 
added), specifically the Unification Church (id., at pp. 232, 255, fn. 30).  Here, in 
contrast, nothing about the Catholic religion prevents a Catholic religious 
organization from qualifying under the WCEA’s exemption for religious 
organizations.  We assume, for example, that a Catholic diocese or parish, acting 
as an employer, would typically qualify under the exemption.   
 In 
contrast, 
Larson, supra, 456 U.S. 228, does not purport to bar a state 
from attempting for valid regulatory purposes to distinguish among organizations 
based on sect-neutral grounds, even if those organizations claim a religious 
character.  Indeed, Larson expressly permits the state to require an organization 
“claiming the benefits of [a] religious-organization exemption” from a regulatory 
statute “to prove that [it] is a religious organization within the meaning of the 
[statute].”  (Id., at p. 255, fn. 30, italics added.)  Were this not true, the mere claim 
of religious character would effectively preclude state regulation. 
 
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WCEA embodies a preference for non-Catholic denominations, the argument fails 
for the reasons already given.   
Catholic Charities’ intent may be to argue that the WCEA discriminates 
against charitable social work as a religious practice.  Such an argument would 
implicate “[t]he principle that government, in pursuit of legitimate interests, 
cannot in a selective manner impose burdens only on conduct motivated by 
religious belief . . . .”  (Lukumi, supra, 508 U.S 520, 543.)  Applying this principle, 
the high court in Lukumi held unconstitutional an ordinance that permitted the 
killing of animals for food or sport, but not in religious rituals.  The ordinance had 
“ ‘every appearance of a prohibition that society is prepared to impose upon 
[Santeria worshippers] but not upon itself.’ ”  (Id., at p. 545, quoting The Florida 
Star v. B.J.F. (1989) 491 U.S. U.S. 524, 542.)  The WCEA is not similar.  If a 
religiously affiliated organization fails to qualify for exemption because its 
purpose is something other than the “inculcation of religious values” (Health & 
Saf. Code, § 1367.25, subd. (b)(1)(A)), then the result is simply that the 
organization becomes subject to the same obligations that apply to all other 
employers.  Because the WCEA applies to all nonreligious employers engaged in 
charitable social work, no argument can logically be made that the WCEA 
imposes a burden on charitable social work only when performed for religious 
reasons.   
As additional support for its claim that the WCEA’s purpose is to 
discriminate against the Catholic Church, Catholic Charities contends the 
Legislature drafted the “religious employer” exception (Health & Saf. Code, 
§ 1367.25, subd. (b)) with the specific intention of excluding Catholic hospitals 
and social service agencies like Catholic Charities.  Catholic Charities draws an 
analogy to Lukumi, supra, 508 U.S. 520, 540-542, in which the high court 
considered specific statements by members of the Hialeah City Council as 
 
27

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evidence that the ordinance prohibiting animal sacrifice was intended to suppress 
the Santeria religion.  Catholic Charities’ assertions about the legislative history of 
the WCEA do not justify a similar conclusion in this case. 
According to Catholic Charities, the history of the WCEA suggests the 
Legislature intended the law to close a “Catholic gap” in insurance coverage for 
prescription contraceptives.  The evidence does not support the contention.  The 
phrase “Catholic gap” appears only in Catholic Charities’ brief, not in the 
legislative history.  Catholic Charities refers to the Senate testimony of a 
representative of Planned Parenthood, which opposed any exception for religious 
employers.  Explaining that organization’s position, the witness stated:  “Primarily 
our intent was to close the gap in insurance coverage for contraception and 
prescription benefit plans.  Our concern with granting an exemption is that that 
defeats the original purpose of the bill.”  The “gap” to which the witness 
apparently referred was the gap identified by a national consulting firm’s 1999 
study of health insurance for prescription contraceptives.  This study, which 
received much attention in the Legislature, concluded that approximately 10 
percent of commercially insured Californians did not already have insurance 
coverage for prescription contraceptives.  The study identified this minority not as 
the employees of Catholic organizations, but as persons covered by PPO and 
indemnity plans.  While most HMO’s covered prescription contraceptives, not all 
PPO and indemnity plans did.  Catholic Charities’ assertion that the purpose of the 
WCEA was to close a “Catholic gap” rather than a statewide statistical gap in 
coverage has no apparent evidentiary support.11   
                                              
11  
Catholic Charities also argues that the Legislature acted out of antipathy 
and spite towards the Catholic Church.  Through this argument, Catholic Charities 
seeks to compare the Legislature’s consideration of the WCEA with the Hialeah 
City Council’s decision (see Lukumi, supra, 508 U.S. 520) to ban animal sacrifice 
as a way of suppressing the Santeria religion.  In discussing the council’s decision, 
 
(footnote continued on next page) 
 
28

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Next, Catholic Charities argues the Legislature deliberately narrowed the 
statutory exception for “religious employer[s]” (Health & Saf. Code, § 1367.25, 
subd. (b)) to include as few Catholic organizations as possible and specifically to 
exclude Catholic hospitals and social service organizations.  The legislative 
history does show that the bill’s sponsors argued against a broader exception.  The 
bill’s Senate sponsor, for example, stated in a committee hearing that “the 
intention of the authors as it relates to creating a religious exemption may not be 
the same intentions of the religions themselves in wanting to be exempted.  [¶]  
The intention of the religious exemption in both these bills is an intention to 
provide for exemption for what is religious activity.  The more secular the activity 
gets, the less religiously based it is, and the more we believe that they should be 
required to cover prescription drug benefits for contraception.”  Catholic Charities 
describes this and similar statements as evidence that the Legislature targeted 
specific Catholic organizations for disadvantageous treatment.  But we have 
already examined and rejected that argument.  The law treats some Catholic 
organizations more favorably than all other employers by exempting them; 
nonexempt Catholic organizations are treated the same as all other employers. 
3. Hybrid rights 
As an additional argument for applying strict scrutiny to its federal free 
exercise claim, Catholic Charities argues that the WCEA violates so-called hybrid 
                                                                                                                                                              
 
(footnote continued from previous page) 
 
the high court noted that Hialeah city officials had castigated Santeria as an 
“abomination to the Lord” and “the worship of demons,” and that a public crowd 
attending the city council’s meeting had interrupted with jeers and taunts the 
President of the Santeria Church.  (Id., at p. 541.)  The legislative history of the 
WCEA discloses no comparable antipathy to the Catholic Church.   
 
 
29

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rights.  The term “hybrid rights” is loosely derived from Smith, supra, 494 U.S. 
872, in which the high court repudiated the strict scrutiny test of Sherbert, 374 
U.S. 398.  (See Smith, at pp. 882-884.)  Along the way to that conclusion, the 
court distinguished certain of its prior decisions as having involved not just the 
free exercise clause but other constitutional provisions as well.  Specifically, the 
court stated that “[t]he only decisions in which we have held that the First 
Amendment bars application of a neutral, generally applicable law to religiously 
motivated action have involved not the Free Exercise Clause alone, but the Free 
Exercise Clause in conjunction with other constitutional protections, such as 
freedom of speech and of the press [12] . . . , or the right of parents . . . to direct the 
education of their children [13] . . . .”  (Id., at p. 881.)  The facts of Smith, the court 
observed, did “not present such a hybrid situation, but a free exercise claim 
unconnected with any communicative activity or parental right.”  (Smith, at 
p. 882.)   
Relying on this passage from Smith, supra, 494 U.S. 872, Catholic 
Charities argues the WCEA violates hybrid rights and, thus, requires us to apply 
strict scrutiny to its free exercise claim.  The other rights violated, Catholic 
Charities asserts, are those protected by the free speech and establishment clauses 
of the First Amendment.  (U.S. Const., 1st Amend.) 
The high court has not, since the decision in Smith, supra, 494 U.S. 872, 
determined whether the hybrid rights theory is valid or invoked it to justify 
applying strict scrutiny to a free exercise claim.  Justice Souter has mentioned 
hybrid rights in a concurring opinion, but only to criticize Smith’s reliance on the 
                                              
12  
Namely, Follett v. McCormick (1944) 321 U.S. 573, Murdock v. 
Pennsylvania (1943) 319 U.S. 105, and Cantwell v. Connecticut, supra, 310 U.S. 
296; see Smith, supra, 494 U.S. 872, 881. 
13  
Namely, Wisconsin v. Yoder, supra, 406 U.S. 205, and Pierce v. Society of 
Sisters (1925) 268 U.S. 510; see Smith, supra, 494 U.S. 872, 881. 
 
30

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concept.  (Lukumi, supra, 508 U.S. 520, 567 (opn. of Souter, J., conc. in part).)  
Some of the lower federal courts have treated the relevant passage from Smith as 
dictum and declined to apply, to assertedly hybrid claims, a standard stricter than 
the rational basis test.  (Leebaert v. Harrington (2d Cir. 2003) 332 F.3d 134, 143-
144; Kissinger v. Board of Trustees (6th Cir. 1993) 5 F.3d 177, 180.)   Other lower 
federal courts appear to have assumed that hybrid claims trigger a higher level of 
scrutiny, but have concluded that “a plaintiff does not allege a hybrid-rights claim 
entitled to strict scrutiny analysis merely by combining a free exercise claim with 
an utterly meritless claim of the violation of another alleged fundamental right.”  
(Miller v. Reed (9th Cir. 1999) 176 F.3d 1202, 1208; see also Civil Lib. for Urban 
Believers v. City of Chicago (7th Cir. 2003) 342 F.3d 752, 765; Swanson by and 
through Swanson v. Guthrie ISD I-L (10th Cir. 1998) 135 F.3d 694, 700.)   
Catholic Charities argues that the non-free-exercise component of a hybrid 
claim need only be “colorable” and not ultimately meritorious.  While some courts 
have proposed such a rule (e.g., Miller v. Reed, supra, 176 F.3d 1202, 1207; 
Swanson by and through Swanson v. Guthrie ISD I-L, supra, 135 F.3d 694, 700), 
no court has relied on it to grant relief.  Nor would such a rule make sense.  As 
Justice Souter has explained, “[i]f a hybrid claim is simply one in which another 
constitutional right is implicated, then the hybrid exception would probably be so 
vast as to swallow the Smith rule . . . .”  (Lukumi, supra, 508 U.S. 520, 567 (opn. 
of Souter, J., conc. in part).)  For this reason, the Sixth Circuit has rejected as 
“completely illogical” the proposition that “the legal standard [of review] under 
the Free Exercise Clause depends on whether a free-exercise claim is coupled with 
other constitutional rights.”  (Kissinger v. Board of Trustees, supra, 5 F.3d 177, 
180 & fn. 1.) 
We are aware of no decision in which a federal court has actually relied 
solely on the hybrid rights theory to justify applying strict scrutiny to a free 
 
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exercise claim.  Indeed, the only federal decision that can properly be said to have 
relied on the theory at all is E.E.O.C. v. Catholic University of America, supra, 83 
F.3d 455, 467, in which the court mentioned hybrid rights as an alternative basis 
for its conclusion that federal employment law could not be applied to require a 
Catholic educational institution to grant tenure to a professor of canon law.  The 
principal basis for the court’s holding was the ministerial exception.  (Id., at 
pp. 463-465; see ante, at p. 11 et seq.)14   
Assuming for the sake of argument the hybrid rights theory is not merely a 
misreading of Smith, supra, 494 U.S. 872, Catholic Charities has not alleged a 
meritorious constitutional claim that might justify the theory’s application to this 
case.  Catholic Charities argues that to assist in providing employees with 
insurance for prescription contraceptives would be viewed as an endorsement of 
their use and that the WCEA, by compelling such assistance, violates the free 
speech clause by requiring the organization to engage in symbolic speech it finds 
objectionable.  The argument lacks merit.  Certainly “the First Amendment may 
prevent the government from compelling individuals to express certain views 
. . . .”  (United States v. United Foods, Inc. (2001) 533 U.S. 405, 410, citing 
Wooley v. Maynard (1977) 430 U.S. 705, 713-717 [state may not compel 
unwilling motorists to display state motto, “Live Free or Die,” on vehicle license 
plates], and Board of Education v. Barnette (1943) 319 U.S. 624, 630-642 [state 
may not compel public school pupils to salute the flag or recite the Pledge of 
Allegiance].)  However, Catholic Charities’ compliance with a law regulating 
health care benefits is not speech.  The law leaves Catholic Charities free to 
                                              
14  
A few state courts have mentioned the hybrid-rights theory.  (First 
Covenant Church v. Seattle (Wash. 1992) 840 P.2d 174, 181-182 [alternative 
ground for decision]; City Chapel v. South Bend (Ind. 2001) 744 N.E.2d 443, 452-
454 (plur. opn. of Dickson, J.).) 
 
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express its disapproval of prescription contraceptives and to encourage its 
employees not to use them.  For purposes of the free speech clause, simple 
obedience to a law that does not require one to convey a verbal or symbolic 
message cannot reasonably be seen a statement of support for the law or its 
purpose.  Such a rule would, in effect, permit each individual to choose which 
laws he would obey merely by declaring his agreement or opposition.  (Cf. Buhl v. 
Hannigan (1993) 16 Cal.App.4th 1612, 1626 & fn. 11 [dismissing as “ludicrous” a 
motorcyclist’s claim that compliance with a law requiring the wearing of helmets 
in effect compelled speech supporting the law, regardless of the motivation for 
noncompliance].)15 
4. California Constitution 
Catholic Charities’ final argument for applying strict scrutiny invokes the 
free exercise clause of the California Constitution.  (Cal. Const., art. I, § 4.)16  
That clause, Catholic Charities contends, forbids the state to burden the practice of 
religion, even incidentally, through a neutral, generally applicable law, unless the 
law in question serves a compelling governmental interest and is narrowly tailored 
to achieve that interest.  Catholic Charities asserts, in other words, that we must 
interpret the California Constitution the same way the United States Supreme 
Court interpreted the federal Constitution’s free exercise clause in Sherbert, supra, 
374 U.S. 398.   
                                              
15  
Catholic Charities perfunctorily asserts that its claims under the 
establishment clause (U.S. Const., 1st Amend.) also justify treating this case as 
involving hybrid rights.  We have, however, already determined that those claims 
lack merit.   
16  
“Free exercise and enjoyment of religion without discrimination or 
preference are guaranteed.  This liberty of conscience does not excuse acts that are 
licentious or inconsistent with the peace or safety of the State. . . .”  (Cal Const., 
art. I, § 4.) 
 
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What might be the proper standard of review for challenges to neutral, 
generally applicable laws under the state Constitution’s free exercise clause is a 
question we left open in Smith v. Fair Employment & Housing Com. (1996) 12 
Cal.4th 1143, 1177-1179 (Smith v. FEHC).  There we rejected, under both federal 
and state law, a landlord’s religiously based claim to exemption from a fair 
housing statute prohibiting discrimination on the basis of marital status.  (Gov. 
Code, § 12955, subd. (a).)  Although the case arose after the high court’s decision 
in Smith, supra, 494 U.S. 872, we nevertheless applied strict scrutiny to the 
landlord’s federal claim because the Religious Freedom Restoration Act required 
us to do so.  (42 U.S.C. § 2000bb et seq., hereafter RFRA; see Smith v. FEHC, at 
pp. 1165-1167.) 17  We did not decide whether the landlord’s claim under the state 
Constitution’s free exercise clause required strict scrutiny.  A plurality of three 
justices assumed for the sake of argument that it did, but declined to “address the 
scope and proper interpretation of California Constitution, article I, section 4.”  
(Smith v. FEHC, at p. 1179 (plur. opn. of Werdegar, J., George and Arabian, JJ., 
conc.).)  “These important questions,” the plurality wrote, “should await a case in 
which their resolution affects the outcome.”  (Ibid.)  Justice Mosk’s concurring 
opinion provided a fourth vote for the disposition.  (Id., at pp. 1179-1192 (conc. 
opn. of Mosk, J.).) 
No decision about the appropriate standard of review can be gleaned from 
the various separate opinions in Smith v. FEHC, supra, 12 Cal.4th 1143.  The 
subject of Justice Mosk’s concurring opinion was his view that RFRA was 
unconstitutional; he did not address the state Constitution.  (Smith v. FEHC, at 
pp. 1179-1192 (conc. opn. of Mosk, J.).)  Justice Kennard, who also wrote 
                                              
17  
The United States Supreme Court subsequently held RFRA unconstitu-
tional.  (City of Boerne v. Flores (1997) 521 U.S. 507.)  
 
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separately, would have held that the challenged law violated RFRA; she, too, did 
not address the state Constitution.  (Id., at pp. 1192-1218 (conc. & dis. opn. of 
Kennard, J.).)  Justice Baxter, who otherwise agreed with Justice Kennard, wrote 
separately to emphasize the point we now make, namely, that the court’s various 
opinions left unsettled “the scope of protection of religious liberty under the free 
exercise clause of our state Constitution.”  (Id., at p. 1250 (conc. & dis. opn. of 
Baxter, J., with Lucas, C.J., conc.).)   
The only published decision purporting to determine the standard of review 
for claims under the California Constitution’s free exercise clause is Brunson v. 
Department of Motor Vehicles (1999) 72 Cal.App.4th 1251.  The Court of Appeal 
in Brunson rejected the contention that the plaintiffs’ religious beliefs excused 
them from complying with a statutory duty (Veh. Code, §§ 1653.5, 12800, subd. 
(a)) to provide their Social Security numbers to the Department of Motor Vehicles 
when applying for drivers’ licenses.  The court interpreted Smith v. FEHC, supra, 
12 Cal.4th 1143, as mandating application of the rational basis test to the 
petitioners’ claims under the state free exercise clause.  (Brunson v. Department of 
Motor Vehicles, supra, at pp. 1255-1256.)  The court’s reading of Smith v. FEHC 
was erroneous.  As we have just explained, in Smith v. FEHC we left the question 
open.18  The Court of Appeal in the case before us, while acknowledging Brunson, 
examined the question independently and concluded that challenges under the 
                                              
18  
While the court in Brunson v. Department of Motor Vehicles, supra, 72 
Cal.App.4th 1251, thus misinterpreted Smith v. FEHC, supra, 12 Cal.4th 1143, we 
have no occasion to reexamine the Brunson court’s ultimate conclusion about the 
validity of the statutes at issue in that case.  We note the Legislature recently 
amended Vehicle Code sections 1653.5 and 12800, subdivision (a), to permit the 
Department of Motor Vehicles to accept appropriate numbers and identifiers other 
than Social Security numbers.  (Stats. 2003, ch. 326, §§ 1, 2.) 
 
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state free exercise clause to neutral, generally applicable laws should be evaluated 
under the rational basis standard of Smith, supra, 494 U.S. 872.  
Certainly the high court’s decision in Smith, supra, 494 U.S. 872, does not 
control our interpretation of the state Constitution’s free exercise clause.  Neither 
does the decision in Sherbert, supra, 374 U.S. 398.  We have observed many times 
“that the meaning of the California Constitution article I, section 4 . . . is not 
dependent on the meaning of any provision of the federal Constitution.  The state 
charter declares in so many words that ‘[r]ights guaranteed by this Constitution are 
not dependent on those guaranteed by the United States Constitution.’  (Cal. 
Const., art. I, § 24.)  ‘Respect for our Constitution as ‘a document of independent 
force’ [citation] forbids us to abandon settled applications of its terms every time 
changes are announced in the interpretation of the federal charter.’ ”  (Smith v. 
FEHC, supra, 12 Cal.4th 1143, 1177, quoting People v. Pettingill (1978) 21 
Cal.3d 231, 248, and People v. Brisendine (1975) 13 Cal.3d 528, 549-550.)  Thus, 
if a settled interpretation of the California Constitution’s free exercise clause had 
existed before 1990, when the United States Supreme Court abandoned the 
Sherbert test, we would simply adhere to that interpretation, regardless of Smith, 
supra, 494 U.S. 872. 
However, no settled interpretation of the state Constitution’s free exercise 
clause existed in 1990.  Between the dates of Sherbert, supra, 374 U.S. 398, and 
Smith, supra, 494 U.S. 872, our own decisions assessing the constitutionality of 
neutral, generally applicable laws that incidentally burdened religious practices 
applied the federal and state free exercise clauses interchangeably, without 
ascribing any independent meaning to the state clause.  (Walker v. Superior Court 
(1988) 47 Cal.3d 112, 138-141; Molko v. Holy Spirit Assn. (1988) 46 Cal.3d 1092, 
1112-1120; In re Arias (1986) 42 Cal.3d 667, 692 & fn. 28; People v. Woody 
(1964) 61 Cal.2d 716, 718, fn. 1.)  In decisions prior to Sherbert, we generally 
 
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took an approach similar to the high court’s decisions of the same era, declining to 
exempt religiously motivated conduct from neutral, generally applicable laws.  We 
wrote, for example, that “a person is free to hold whatever belief his conscience 
dictates, but when he translates his belief into action he may be required to 
conform to reasonable regulations which are applicable to all persons and are 
designed to accomplish a permissible objective.”  (Rescue Army v. Municipal 
Court (1946) 28 Cal.2d 460, 470.)  We also wrote that, “[i]f the applicability of 
government regulation turned on the religious motivation of activities, plausible 
motivations would multiply and in the end vitiate any regulation.” (Gospel Army v. 
City of Los Angeles (1945) 27 Cal.2d 232, 243; see also Gabrielli v. 
Knickerbocker (1938) 12 Cal.2d 85, 90-92 [declining to reinstate a pupil expelled 
from public school for refusing on religious grounds to salute the flag]; Ex parte 
Andrews (1861) 18 Cal. 678, 683-685 [upholding a Sunday closing law].)   
In view of this history, we may safely agree with the scholars who 
concluded in 1993, years after the high court decided Smith, supra, 494 U.S. 872, 
that “[s]ection 4 has not so far played an independent role in free exercise claims.”  
(Grodin et al., The Cal. State Constitution:  A Reference Guide (1993) p. 44.)   
In a case that truly required us to do so, we should not hesitate to exercise 
our responsibility and final authority to declare the scope and proper interpretation 
of the California Constitution’s free exercise clause.  (Cal. Const., art. I, § 4.)  
Here, however, we need not do so because Catholic Charities’ challenge to the 
WCEA fails in any event.  As we explain below, the statute passes strict scrutiny.  
A future case might lead us to choose the rule of Sherbert, supra, 374 U.S. 398, 
the rule of Smith, supra, 494 U.S. 872, or an as-yet unidentified rule that more 
precisely reflects the language and history of the California Constitution and our 
own understanding of its import.  But “[t]hese important questions should await a 
 
37

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case in which their resolution affects the outcome.”  (Smith v. FEHC, supra, 12 
Cal.4th 1143, 1179.) 
We therefore review Catholic Charities’ challenge to the WCEA under the 
free exercise clause of the California Constitution in the same way we might have 
reviewed a similar challenge under the federal Constitution after Sherbert, supra, 
374 U.S. 398, and before Smith, supra, 494 U.S. 872.  In other words, we apply 
strict scrutiny.  Under that standard, a law could not be applied in a manner that 
substantially burdened a religious belief or practice unless the state showed that 
the law represented the least restrictive means of achieving a compelling interest 
or, in other words, was narrowly tailored.  (See Thomas v. Review Bd., Ind. Empl. 
Sec. Div. (1981) 450 U.S. 707, 718; Sherbert, supra, 374 U.S. 398, 403, 406, 407-
408.)  For these purposes, a law substantially burdens a religious belief if it 
“conditions receipt of an important benefit upon conduct proscribed by a religious 
faith, or where it denies such a benefit because of conduct mandated by religious 
belief, thereby putting substantial pressure on an adherent to modify his behavior 
and to violate his beliefs . . . .”  (Thomas v. Rev. Bd., Ind. Empl. Sec. Div., supra, 
450 U.S. 707, 717-718.)   
Applying this standard, we consider first whether the WCEA in fact 
burdens Catholic Charities’ religious beliefs.  We do not doubt Catholic Charities’ 
assertion that to offer insurance coverage for prescription contraceptives to its 
employees would be religiously unacceptable.  Catholic Charities adequately 
supports the assertion with the declaration of a Roman Catholic priest who serves 
as Executive Director of the Secretariat for Doctrine and Pastoral Practices of the 
National Conference of Roman Catholic Bishops.  Catholic Charities may, 
however, avoid this conflict with its religious beliefs simply by not offering 
coverage for prescription drugs.  The WCEA applies only to employers who 
 
38

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choose to offer insurance coverage for prescription drugs; it does not require any 
employer to offer such coverage.     
Anticipating this objection, Catholic Charities argues that its religious 
beliefs also require it to offer its employees insurance for prescription drugs.  On 
this point, however, the declaration just mentioned seems open to interpretation.  
The declarant states:  “The clear teaching and firm doctrine of the Roman Catholic 
Church is that all employers, religious or otherwise, are to provide just wages and 
benefits to employees, regardless of their religious affiliations and beliefs, as an 
obligation arising from the Gospel message of justice and charity.  The goal of the 
Roman Catholic Church, also as a matter of justice and charity, is that all workers 
regardless of their circumstances should receive adequate health-care coverage.”  
In the present context—that of weighing an asserted burden on religious beliefs 
against the state interests supporting a challenged statute—the declaration raises 
the question whether Catholic Charities’ beliefs about the requirements of “justice 
and charity” are necessarily equivalent to religious beliefs.  We must ask this 
question because a claim under the free exercise clause must be “rooted in 
religious belief” and not on “philosophical” choices or “[a] way of life, however 
virtuous and admirable.”  (Wisconsin v. Yoder, supra, 406 U.S. 205, 215, 216.)   
“Although a determination of what is a ‘religious’ belief or practice entitled to 
constitutional protection may present a most delicate question, the very concept of 
ordered liberty precludes allowing every person to make his own standards on 
matters of conduct in which society as a whole has important interests.”  (Id., 
pp. 215-216, footnote omitted.)19   
                                              
19  
Assuming the obligation to provide adequate health care coverage is a 
religious belief, one might also ask whether a religious employer opposed to 
contraceptives on religious grounds could avoid all conflict with its beliefs by 
declining coverage for prescription drugs (thus satisfying the WCEA) while 
offering its employees a raise to offset the reduced benefits, accompanied by 
 
(footnote continued on next page) 
 
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The need to ask questions such as these places a court in an uncomfortable 
position.  “Repeatedly and in many different contexts,” the high court has “warned 
that courts must not presume to determine the place of a particular belief in a 
religion or the plausibility of a religious claim.”  (Smith, supra, 494 U.S. 872, 
887.)  The line between construing Catholic Charities’ declaration, which we must 
do, and determining the plausibility of religious claims, which we may not do, is 
fine indeed.  Equally fine is the line between construing the declaration and 
determining whether the asserted burden falls on a protected religious belief or an 
unprotected philosophical choice, which we also must do.  (Wisconsin v. Yoder, 
supra, 406 U.S. 205, 215-216.)   If we had to ask and answer these difficult 
questions, we would.  But we need not do so because Catholic Charities’ claim 
fails in any event:  Assuming for the sake of argument the WCEA substantially 
burdens a religious belief or practice, the law nevertheless serves a compelling 
state interest and is narrowly tailored to achieve that interest. 
The WCEA serves the compelling state interest of eliminating gender 
discrimination.  Evidence before the Legislature showed that women during their 
reproductive years spent as much as 68 percent more than men in out-of-pocket 
health care costs, due in part to the cost of prescription contraceptives and the 
various costs of unintended pregnancies, including health risks, premature 
                                                                                                                                                              
 
(footnote continued from previous page) 
 
whatever condemnations of contraceptives the employer wished to offer.  A raise 
might be far more expensive for the employer than insurance, and a law that 
indirectly made a religious practice more expensive might at some point become a 
constitutionally significant burden on religious exercise.  However, “it cannot be 
expected, much less required that legislators enact no law regulating conduct that 
may in some way result in an economic disadvantage to some religious sects and 
not to others because of the special practices of the various religions.”  (Braunfeld 
v. Brown, supra, 366 U.S. 599, 605.) 
 
40

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deliveries and increased neonatal care.  (See p. 2, ante.)  Assembly, Senate and 
legislative staff analyses of the bills that became the WCEA consistently identify 
the elimination of this economic inequity as the bills’ principal object.  Catholic 
Charities, which pays men and women equal wages, argues the type of inequity 
that prompted the WCEA cannot properly be viewed as gender discrimination.  To 
identify subtle forms of gender discrimination, however, is within the 
Legislature’s competence.  Nor is the identification irrational.20  Congress, making 
a similar identification, amended title VII to define discrimination “on the basis of 
sex” as including discrimination in benefits “on the basis of pregnancy, childbirth, 
or related medical conditions . . . .”  (42 U.S.C. § 2000e(k) (Pregnancy 
Discrimination Act), abrogating General Electric Co. v. Gilbert (1976) 429 U.S. 
125; see Newport News Shipbuilding & Dry Dock v. EEOC (1983) 462 U.S. 669, 
678 [acknowledging abrogation].)  The only reported federal decision addressing 
the issue holds that the statute just quoted requires employers to include coverage 
for prescription contraceptives when offering health care plans that cover 
prescription drugs.  (Erickson v. Bartell Drug Co. (W.D.Wash. 2001) 141 
F.Supp.2d 1266, 1270-1272; but cf. Glaubach v. Regence Blueshield (Wash. 2003) 
74 P.3d 115, 116-119 [holding that a Washington statute requiring insurers to 
provide coverage regardless of sex does not mandate coverage of prescription 
contraceptives].)  Certainly the interest in eradicating gender discrimination is 
compelling.  We long ago concluded that discrimination based on gender violates 
the equal protection clause of the California Constitution (art. I, § 7(a)) and 
                                              
20  
At least 19 other states have adopted laws requiring that employers or 
insurers provide coverage for prescription contraceptives.  (See Note, The Quest 
for Equality:  Comprehensive Insurance Coverage of Prescription Contraceptives 
(2002) 82 Boston U. L.Rev. 1289, 1290, 1298-1301; Comment, Contraceptive 
Coverage Laws:  Eliminating Gender Discrimination or Infringing on Religious 
Liberties? (2002) 69 U. Chicago L.Rev. 1867, 1877, fn. 68.) 
 
41

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triggers the highest level of scrutiny.   (Sail’er Inn, Inc. v. Kirby (1971) 5 Cal.3d 1, 
17-20.) 
Strongly enhancing the state’s interest is the circumstance that any 
exemption from the WCEA sacrifices the affected women’s interest in receiving 
equitable treatment with respect to health benefits.  We are unaware of any 
decision in which this court, or the United States Supreme Court, has exempted a 
religious objector from the operation of a neutral, generally applicable law despite 
the recognition that the requested exemption would detrimentally affect the rights 
of third parties.  The high court in Wisconsin v. Yoder, supra, 406 U.S. 205, 
painstakingly limited its holding to avoid endorsing any such result.  While 
concluding that the Amish parents in that case were entitled under the strict 
scrutiny standard of Sherbert, supra, 374 U.S. 398, to an exemption from a general 
law requiring their older children to attend public school, the court emphasized 
that its conclusion depended on the assumption that no Amish child wished to 
attend.  (Wisconsin v. Yoder, supra, at pp. 230-232.)  Similarly, in rejecting a 
religious employer’s challenge to a law requiring him to pay Social Security and 
unemployment taxes for his employees, the court wrote that “[g]ranting an 
exemption from social security taxes to an employer operates to impose the 
employer’s religious faith on the employees.”  (United States v. Lee, supra, 455 
U.S. 252, 261.)  “Congress and the courts have been sensitive to the needs flowing 
from the Free Exercise Clause, but every person cannot be shielded from all the 
burdens incident to exercising every aspect of the right to practice religious 
beliefs.  When followers of a particular sect enter into commercial activity as a 
matter of choice, the limits they accept on their own conduct as a matter of 
conscience and faith are not to be superimposed on the statutory schemes which 
are binding on others in that activity.”  (Ibid.; cf. Tony and Susan Alamo 
Foundation v. Sec’y of Labor, supra, 471 U.S. 290, 303-306 [religious 
 
42

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organization must comply with federal minimum wage laws]; Dole v. Shenandoah 
Baptist Church (4th Cir. 1990) 899 F.2d 1389, 1393-1400 [religious school must 
comply with federal law requiring equal pay for men and women].)  We see no 
reason why a different rule should apply when a nonprofit corporation enters the 
general labor market. 
Nor are any less restrictive (or more narrowly tailored) means readily 
available for achieving the state’s interest in eliminating gender discrimination.  
Any broader exemption increases the number of women affected by discrimination 
in the provision of health care benefits.  Catholic Charities argues the Legislature 
could more widely exempt employers from the WCEA without increasing the 
number of affected women by mandating public funding of prescription 
contraceptives for the employees of exempted employers.  The Legislature 
included such a provision in an earlier version of the WCEA (Assem. Bill 
No. 1112 (1997-1998 Reg. Sess.)), which the Governor vetoed.  But Catholic 
Charities points to no authority requiring the state to subsidize private religious 
practices.  (Cf. Lyng v. Northwest Indian Cemetery Prot. Assn., supra, 485 U.S. 
439, 447-453 [government need not forgo road building or timber harvesting on its 
own property to avoid interference with Native American religious practices].)   
Catholic Charities next argues the WCEA is underinclusive, and therefore 
not narrowly tailored, because it does not facilitate access to prescription 
contraceptives for “indigent women, unemployed women, stay-at-home mothers, 
women whose employers do not offer health insurance benefits, and women in 
part-time employment [who] do not qualify for health benefits.”  But this 
argument misconceives the principal purpose of the WCEA, which is not to 
facilitate access to contraceptives but to eliminate a form of gender discrimination 
in the provision of health benefits.  The situations Catholic Charities identifies, in 
 
43

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which no employer or insurer is providing health benefits, do not entail such 
discrimination.   
Finally on this point, Catholic Charities argues the WCEA is not narrowly 
tailored because it is overinclusive.  Catholic Charities justifies this surprising 
assertion by arguing that the law must be overinclusive if it applies to employers 
that do not discriminate on the basis of gender, and that Catholic Charities does 
not discriminate on that basis because it does not provide contraceptive coverage 
to women or to men (e.g., vasectomies).  With this argument, however, Catholic 
Charities merely restates its disagreement with the Legislature’s determination that 
the exclusion of prescription contraceptives from health care plans constitutes a 
form of gender discrimination.  As we have already explained, the Legislature was 
entitled to reach that conclusion.   
For these reasons, applying the strict scrutiny test of Sherbert, supra, 374 
U.S. 398, to Catholic Charities’ claim against the WCEA under the free exercise 
clause of the state Constitution, we find the WCEA meets that test.  We do not 
hold that the state free exercise clause requires courts to apply the Sherbert test to 
neutral, generally applicable laws that incidentally burden religious practice.  
Instead, as explained above, we leave that question for another day. 
C.  Rational Basis 
Catholic Charities’ final challenge to the WCEA is that it violates the 
rational basis test.  More specifically, Catholic Charities argues the State has 
defined the exempt category of “religious employer” (Health & Saf. Code, 
§ 1367.25, subd. (b)) with arbitrary criteria.  “In effect,” according to Catholic 
Charities, “the Legislature decided that any religious institution that employs 
individuals of other faiths or that ministers to persons of all faiths (or no faith)—in 
effect any ‘missionary’ church or church with social outreach—is not sufficiently 
 
44

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‘religious’ to qualify for exemption,” and that these classifications are “wholly 
unrelated to any legitimate state interest.”   
The argument lacks merit.  The WCEA’s exemption for religious 
organizations, even if not applicable to Catholic Charities, rationally serves the 
legitimate interest of complying with the rule barring interference with the 
relationship between a church and its ministers.  (See ante, at p. 11 et seq.)  
Although the high court has not spoken on the subject, the lower federal courts 
have held that the constitutionally based ministerial exemption survives the 
decision in Smith, supra, 494 U.S. 872.  (See, e.g., Gellington v. Christian 
Methodist Episcopal Church, Inc., supra, 203 F.3d 1299, 1302-1304; Combs v. 
Cen Tx Ann Conf United Methodist Church, supra, 173 F.3d 343, 347-350; 
E.E.O.C. v. Catholic University of America, supra, 83 F.3d 455, 460-463; cf. 
Schmoll v. Chapman University, supra, 70 Cal.App.4th 1434, 1438-1445 
[recognizing a ministerial exception to state employment laws].)  Most 
organizations entitled to invoke the ministerial exemption will be involved in the 
“inculcation of religious values,” which the first criterion requires.  (Health & Saf. 
Code, § 1367.25, subd. (b)(1)(A).)  Many will also satisfy the WCEA’s fourth 
exemption criterion, which requires that a religious employer qualify for federal 
tax exemption as a church, an integrated auxiliary of a church, a convention or 
association of churches, or a religious order.  (See 26 U.S.C. § 6033(a)(2)(A)(i) 
and (iii), cited in Health & Saf. Code, § 1367.25, subd. (b)(1)(D).)  If in any case 
the constitutionally required ministerial exception were broader than the statutory 
exemption, the former would of course take precedence. 
The second criterion, to which Catholic Charities specifically objects as 
lacking a rational basis, requires that an employer “primarily employ[] persons 
who share the religious tenets of the entity.”  (Health & Saf. Code, § 1367.25, 
subd. (b)(1)(B).)  This provision, in effect, accommodates religious employers 
 
45

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more broadly than the ministerial exemption requires by extending the WCEA’s 
exemption to employees who could not fall within the ministerial exemption.  The 
provision has the legitimate, rational purpose of accommodating a state-imposed 
burden on religious exercise.  (Amos, supra, 483 U.S. 327, 334-335.)   
The third criterion, to which Catholic Charities also objects, is problematic.  
To qualify under it, an employer must “serve[] primarily persons who share the 
religious tenets of the entity.”  (Health & Saf. Code, § 1367.25, subd. (b)(1)(C).)  
To imagine a legitimate purpose for such a requirement is difficult.  Reading the 
provision literally, a hypothetical soup kitchen run entirely by the ministers of a 
church, which inculcates religious values to those who come to eat (thus satisfying 
the first, second, and fourth criteria), would lose its claim to an exemption from 
the WCEA if it chose to serve the hungry without discrimination instead of 
serving co-religionists only.  The Legislature may wish to address this problem.  
Catholic Charities, however, cannot successfully challenge the WCEA on this 
ground because the organization concedes it does not qualify under any of the 
criteria for exemption, including the relatively objective terms of the federal tax 
statute cited in the fourth criterion.  (Health & Saf. Code, § 1367.25, subd. 
(b)(1)(D).)  Catholic Charities thus cannot qualify for exemption in any event.   
 
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III.  DISPOSITION 
The decision of the Court of Appeal is affirmed. 
 
 
 
 
 
 
WERDEGAR, J. 
WE CONCUR: 
GEORGE, C.J. 
BAXTER, J. 
CHIN, J. 
MORENO, J. 
 
 
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CONCURRING OPINION BY KENNARD, J. 
 
 
In September 1999, the Legislature enacted the Women’s Contraception 
Equity Act (WCEA).  Under this law, every group health care policy that 
“provides coverage for outpatient prescription drug benefits” must, as of January 
1, 2000, include coverage for contraceptives.  (Health & Saf. Code, § 1367.25.)1  
Exempt from the WCEA are policies sold to entities that are religious employers.  
To fall within the act’s definition of “religious employer,” each of these four 
requirements must be satisfied:   
“(A)  The inculcation of religious values is the purpose of the entity. 
“(B)  The entity primarily employs persons who share the religious tenets 
of the entity. 
“(C)  The entity serves primarily persons who share the religious tenets of 
the entity. 
“(D)  The entity is a nonprofit organization as described in Section 
6033(a)(2)(A)i or iii, of the Internal Revenue Code of 1986, as amended.”  
(§ 1367.25, subd. (b)(1).) 
Plaintiff Catholic Charities of Sacramento (Catholic Charities), which has 
brought this lawsuit challenging the constitutionality of the religious employer 
exemption, acknowledges that it does not satisfy any of the four requirements for 
                                              
1   
Further undesignated statutory references are to the Health and Safety 
Code.   
1 

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that exemption.  Catholic Charities’ complaint alleges that it is a nonprofit public 
benefit corporation “operated in connection with the Roman Catholic Bishop of 
Sacramento” as “an organ of the Roman Catholic Church.”  The complaint further 
alleges that Catholic Charities’ mission is to perform good works, such as 
“providing immigrant resettlement programs, elder care, counseling, food, 
clothing and affordable housing for the poor and needy, housing and vocational 
training of the developmentally disabled and the like.”  According to the 
complaint, Catholic Charities provided prescription drug coverage to its 183 
employees before the WCEA’s effective date; for it to continue to do so now 
would be promoting the use of contraceptives, a sinful practice under Catholic 
Church doctrine.  For the purposes of deciding the legal issues in this case, the 
majority accepts these allegations as true, as do I.   
I agree with the majority that Catholic Charities is properly subject to the 
WCEA.  In the course of its discussion, however, the majority rejects Catholic 
Charities’ argument that the religious employer exemption discriminates against 
“religious organizations . . . that engage in charitable work, as opposed to work 
that is purely spiritual or evangelical.”  (Maj. opn., ante, at p. 24.)  I am not 
persuaded that the first requirement of the religious employer exemption, limiting 
the exemption to entities whose primary purpose is the “inculcation of religious 
values” (§ 1367.25, subd. (b)(1)(A)), can be reconciled with the establishment 
clauses of the federal and state Constitutions.  This is a close and difficult issue.  I 
need not resolve it, however, because Catholic Charities does not meet the 
exemption’s fourth requirement that it is a religious entity exempt from federal tax 
filing, a requirement that both the majority and I agree is constitutional. 
I  
 
The United States Constitution’s First Amendment provides that “Congress 
shall make no law respecting an establishment of religion.”  (U.S. Const., 1st 
2 

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Amend.)  This provision applies to the states through the Fourteenth Amendment; 
thus, state governments too are prohibited from making such laws.  Like its federal 
counterpart, California’s Constitution provides that the Legislature “shall make no 
law respecting an establishment of religion.”  (Cal. Const., art. I, § 4.)  Laws that 
prefer one religion or religious organization over another (often called 
“denominational preferences”) violate these provisions.  (See Epperson v. 
Arkansas (1968) 393 U.S. 97, 106 [“State may not adopt programs or practices . . . 
which ‘aid or oppose’ any religion.”]; Everson v. Board of Education (1947) 330 
U.S. 1, 15 [no state can “pass laws which aid one religion” or that “prefer one 
religion over another”].)   
 
On this basis, the United States Supreme Court in Larson v. Valente (1982) 
456 U.S. 228 invalidated a Minnesota law that treated religious organizations 
differently.  The law in question generally required charitable organizations that 
solicited contributions to register with the state and to disclose their income and its 
sources, as well as costs of management, fundraising, and public education.  
Exempt from this law were religious organizations that received more than 50 
percent of their charitable contributions from their own members or affiliates, 
rather than from the general public.  Not exempt were religious organizations such 
as the Holy Spirit Associations for the Unification of World Christianity 
(Unification Church) that received more than half of their charitable contributions 
from “ ‘door-to-door and public-place proselytizing and solicitation of funds,’ ” a 
practice emphasized by the tenets of that religion.  (Id. at p. 234.)  Unification 
Church members sued, seeking exemption from the law.  The federal district court 
granted the plaintiffs a preliminary injunction, which was affirmed on appeal.  The 
United States Supreme Court, in turn, agreed that the law impermissibly 
“impose[d] the registration and reporting requirements . . . on some religious 
organizations but not on others”; it thus, did “not operate evenhandedly,” but 
3 

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instead, “effect[ed] the selective legislative imposition of burdens and advantages 
upon particular denominations.”  (Id. at pp. 253-254.)   
 
Catholic Charities argues here that the WCEA’s religious employer 
exemption similarly imposes its burdens and advantages on some religious 
organizations but not others.  Catholic Charities points out that the exemption 
favors those religious organizations whose purpose is “[t]he inculcation of 
religious values” (§ 1367.25, subd. (b)(1)(A)), while disfavoring those entities, 
such as Catholic Charities, whose purpose is to perform good works.  Comparing 
the WCEA to the Minnesota law struck down by the high court in Larson v. 
Valente, supra, 456 U.S. 228, 253, which “impose[d] the registrative and reporting 
requirements on some religious organizations but not on others,” Catholic 
Charities argues that similarly here the WCEA imposes the contraceptive 
insurance coverage on some religious organizations but not on others.   
 
To distinguish the WCEA’s religious employer exemption from the 
religious organization charitable reporting exemption invalidated in Larson v. 
Valente, supra, 456 U.S. 228, the majority states:  “The WCEA confers the special 
benefit of exemption only on those religious organizations whose tenets are 
opposed to prescription contraceptives and that meet the other requirements for 
exemption. . . .  Those Catholic employers that do not qualify for exemption are 
treated precisely the same as all other employers in the state, whether religious or 
nonreligious.”  (Maj. opn., ante, at p. 25, italics added.)  But the Minnesota 
charitable solicitation registration law struck down in Larson v. Valente treated 
religious organizations not qualifying for its exemption “precisely the same as” 
nonreligious charitable solicitors and other nonqualifying religious solicitors.  
Thus, in treating religious entities that do not qualify for its exemption just like 
nonreligious entities subject to its requirements, the WCEA seems substantially 
similar to that unconstitutional Minnesota law.  
4 

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Under the high court’s analysis in Larson v. Valente, supra, 456 U.S. 228, a 
law that selectively discriminates among religious organizations might still not 
violate the establishment clause if it is “closely fitted to the furtherance” of a 
“compelling governmental interest.”  (Id. at p. 255.)  As the majority explains, and 
I agree, the WCEA serves the compelling state interest of eliminating gender 
discrimination.  (Maj. opn., ante, at p. 40.)  But in upholding the first requirement 
of the religious employer exemption (limiting it to those religious entities whose 
purpose is inculcating religious values), the majority does not explain how that 
limitation is “closely fitted” to the elimination of gender discrimination.  I have 
serious doubts that the First Amendment, as construed by the United States 
Supreme Court, allows California to limit its religious employer exemption to 
religious entities that have as their purpose the inculcation of religious values, 
denying that exemption to religious entities, like Catholic Charities, that are 
organized for the purpose of feeding the hungry, caring for the sick, and providing 
shelter to the homeless.2   
II 
 
As I noted at the outset, dispositive here is Catholic Charities’ concession 
that it does not meet the fourth requirement for the WCEA’s religious employer 
exemption as a religious entity exempt from federal tax filing.  (See § 1367.25, 
subd. (b)(1)(D).)  Because the concerns expressed above about the 
                                              
2   
The majority construes Larson v. Valente, supra, 456 U.S. 228, as 
prohibiting only those laws that discriminate among religious denominations and 
thus as having no effect on Catholic Charities, an entity affiliated with the Roman 
Catholic denomination.  (Maj. opn., ante, at p. 26, fn. 10.)  Even under this view, 
the first requirement of the WCEA’s religious employer exemption is of 
questionable constitutionality because it disfavors those denominations that have 
as their primary purpose something other than the inculcation of religious values.  
Thus any organization or entity established by a religious denomination whose 
primary purpose was attending to the needy would on that basis be denied the 
religious employer exemption.   
5 

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constitutionality of the exemption’s first requirement—that “inculcation of 
religious values” (§ 1367.25, subd. (b)(1)(A)) is the purpose of the entity—can 
have no effect on the judgment, I agree with the majority that if Catholic Charities 
is to afford its employees health coverage that would include outpatient 
prescription drugs, it must do so through a policy that provides coverage for 
prescription contraceptives.  
       KENNARD, 
J. 
 
6 

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DISSENTING OPINION BY BROWN, J. 
 
 
This case presents questions on which reasonable minds can differ—
especially in light of the whimsical and somewhat erratic path of free exercise 
jurisprudence after the Supreme Court’s decision in Employment Div., Ore. Dept. 
of Human Res. v. Smith (1990) 494 U.S. 872 (Smith).  However, as a court pledged 
to defend constitutional limits, operating in the post-Smith environment, we ought 
to think very carefully about our role in defining the road ahead.  Instead of being 
dismissive of the very serious claims presented here, we should treat them with the 
highest respect. 
 After 
Smith, neutral, generally applicable laws do not have to survive 
compelling state interest review.  Such laws require no justification no matter how 
severely they burden the individual religious claimant and no matter how 
inconsequential the government interest.  (See Smith v. Fair Employment & 
Housing Com. (1996) 12 Cal.4th 1143, 1195 (conc. & dis. opn. of Kennard, J.) 
(Smith v. FEHC).)  It is, however, far from self-evident, if or how, Smith applies to 
laws that directly contravene the religious conduct of religious organizations.  The 
Women’s Contraceptive Equity Act (WCEA) attempts to circumvent this 
potentially substantial hurdle by creating a very narrow exemption for churches.  
But that begs an even more fundamental question:  may the government determine 
what parts of bona fide religious organizations are religious and what parts are 
secular?  And, in particular, may the government make such distinctions in order 
to infringe the religious freedom of that portion of the organization the 
 
1

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government characterizes as secular?  Because, unlike the majority, I do not think 
Smith provides obvious answers to these questions, I respectfully dissent. 
I 
 
The proponents of the WCEA make an argument with which no one can 
disagree.  Women in the workplace are entitled to be treated fairly and equitably 
and to be free from discrimination on the basis of gender.  Government has not 
only the authority, but the obligation, to discourage invidious discrimination in the 
workplace, and this includes discrimination in the distribution of benefits.  (See, 
e.g., Erickson v. Bartell Drug Company (W.D.Wash. 2001) 141 F.Supp.2d 1266, 
1271 [title VII, as amended by the Pregnancy Discrimination Act, prevented 
exclusion of contraception from prescription drug coverage offered by employer]; 
42 U.S.C. § 2000e(k) [prohibiting, under title VII, discrimination on the basis of 
“pregnancy, childbirth, or related medical conditions”]; U.S. EEOC, Commission 
Decision (Dec. 14, 2000) [coverage of contraception] <http://eeoc.gov/policy/ 
docs/decision-contraception.html> [as of Mar. 1, 2004]; Conn. Gen. Stat.,  
§ 38a-503e (2001) [mandating insurance coverage of prescription contraception]; 
Mass. Gen. Laws, ch. 176B, § 4W(b) (2002) [same]; Vt. Stat. Ann., tit. 8, § 4099c 
(2000) [same].) 
 
Neither the propriety, nor the wisdom of, nor the government’s authority to 
impose a prescription contraceptive mandate on California employers is at issue 
here.  The question is a very narrow one.  May the government impose a mandate 
on a religiously affiliated employer that requires the employer to pay for 
contraceptives—in violation of an acknowledged religious tenet—or to redefine 
what constitutes religious conduct?1  While antidiscrimination laws reflect a 
                                              
1 
The question has to be stated in the alternative because the California 
enactment has some peculiarities.  Despite the state’s argument that it has a 
compelling interest in ensuring that all working women who desire prescription 
 
(footnote continued on next page) 
 
2

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constitutional value, religious liberty occupies a commensurate level in the 
constitutional hierarchy.  As often happens with First Amendment cases, this is “a 
collision between two interests of the highest order:  the Government’s interest in 
eradicating discrimination in employment and the constitutional right of a church 
to manage its own affairs free from governmental interference.”  (Equal Emp. 
Opp. Comm’n v. The Catholic Univ. of America (D.C. Cir. 1996) 83 F.3d 455, 460 
(Catholic University).)  Thus, the desire to prevent discrimination cannot be the 
beginning and the end of the discussion. 
A. 
Why Religious Liberty Is Important 
 
A strong argument can be made that it was the primacy of religious liberty 
in the early history of this country, with its acknowledgment of the separate 
spheres of church and state, that gave rise to our notions of limited government 
and equal protection—the constitutional precursors of our antidiscrimination laws.  
(McConnell, Why Is Religious Liberty the “First Freedom”? (2000) 21 Cardozo 
L.Rev. 1243, 1244 [“the division between temporal and spiritual authority gave 
rise to the most fundamental features of liberal democratic order:  the idea of 
limited government, the idea of individual conscience and hence of individual 
rights, and the idea of civil society, as apart from government, bearing primary 
responsibility for the formation and transmission of opinions and ideas”].) 
 
Our ability to create a space for religious perspectives is both instrumental 
and regenerative for democracy.  Religious institutions enhance individual 
                                                                                                                                                              
 
(footnote continued from previous page) 
 
contraceptive coverage have that option available, the mandate is imposed only on 
employers that provide prescription coverage.  Thus, Catholic Charities of 
Sacramento, Inc. (Catholic Charities), can choose either to provide contraceptives 
or not to provide prescription coverage to employees at all.  This option would 
arguably make everyone worse off, but, in theory at least, equally so.   
 
3

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autonomy “by challenging the sovereign power of the liberal state” (Noonan, The 
End of Free Exercise? (1992) 42 De Paul L.R. 567, 579-580) and by articulating 
alternative visions—“counter-cultural visions that challenge and push the larger 
community in . . . directions unimagined by prevailing beliefs.”  (Brady, Religious 
Organizations and Mandatory Collective Bargaining Under Federal and State 
Labor Laws:  Freedom From and Freedom For (2004) 49 Vill. L.Rev. 77, 156.)  
By protecting religious groups from gratuitous state interference, we convey broad 
benefits on individuals and society.  By underestimating the transformative 
potential of religious organizations, we impoverish our political discourse and 
imperil the foundations of liberal democracy. 
B. Does 
Smith Apply to Religious Organizations? 
 
Despite its surface simplicity, Smith is not an easy case to understand or 
apply.  The majority correctly quotes the critical passages from Smith:  “ ‘[T]he 
right of free exercise does not relieve an individual of the obligation to comply 
with a “valid and neutral law of general applicability on the ground that the law 
proscribes (or prescribes) conduct that his religion prescribes (or proscribes).” ’  
(Smith, [supra, 494 U.S.] at p. 879, quoting United States v. Lee [(1982)] 455 U.S. 
252, 263, fn. 3 (conc. opn. of Stevens, J.).)  To permit religious beliefs to excuse 
acts contrary to law, the Smith court reasoned, ‘ “would be to make the professed 
doctrines of religious belief superior to the law of the land, and in effect to permit 
every citizen to become a law unto himself. ” ’  (Smith, at p. 879, quoting Reynolds 
v. United States (1879) 98 U.S. 145, 167.)”  (Maj. opn., ante, at p. 17, italics 
added.) 
 Since 
Smith focused exclusively on the individual’s free exercise of 
religion, some courts have reasoned that religious institutions are exempted 
entirely from the Smith analysis.  (Gellington v. Christian Methodist Episcopal 
Church, Inc. (11th Cir. 2000) 203 F.3d 1299, 1303; see Kaplan, The Devil Is in the 
 
4

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Details:  Neutral, Generally Applicable Laws and Exceptions from Smith (2000) 
75 N.Y.U. L.Rev. 1045, 1070.) 
 
1.  Individuals v. Institutions 
 
This case involves a religious organization and not an individual.  Perhaps 
more importantly, it does not deal with the denial of a benefit because of a 
violation of existing law.  Rather, it attempts to assess the constitutional 
implications of a law that requires a religious organization to provide a benefit 
despite its theological objections.  These fundamental differences are simply 
ignored in the majority’s analysis. 
 Under 
Smith, the right of free exercise does not relieve an individual of the 
obligation to comply with a valid and neutral law of general applicability even if 
the law requires conduct that contravenes a religious belief, but “[i]t does not 
follow . . . that Smith stands for the proposition that a church may never be 
relieved from such an obligation.”  (Catholic University, supra, 83 F.3d at p. 462.)   
 
The majority may have made an abortive attempt to deal with this obvious 
distinction by citing, and dismissing, the so-called ministerial exception.  It is true, 
as the majority notes, that the ministerial exception is not directly at issue here. 
(See, e.g., Alicea-Hernandez v. Catholic Bishop of Chicago (7th Cir. 2003) 320 
F.3d 698 [ministerial exception to title VII]; E.E.O.C. v. Roman Catholic Diocese 
of Raleigh (4th Cir. 2000) 213 F.3d 795 [same]; Combs v. Central Texas Ann. 
Conf. of United Methodist Church (5th Cir. 1999) 173 F.3d 343 [same].)  
Likewise, it is certainly debatable whether the legislative action challenged here 
invades the narrow domain labeled church autonomy.  (See, e.g., Serbian Eastern 
Orthodox Diocese v. Milivojevich (1976) 426 U.S. 696 [state court impermissibly 
encroached on church autonomy]; Kedroff v. St. Nicholas Cathedral (1952) 344 
U.S. 94 [state statute impermissibly encroached on church autonomy].)  And yet, 
the logic of these cases suggests that the constitutionally protected space for 
 
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religious organizations is actually broader than these obvious categories.  In short, 
the ministerial exception and the church autonomy doctrine are ways of describing 
spheres of constitutionally required protection, but these categories are not 
exhaustive. 
 
The court in Catholic University summarized the distinction it was making 
this way:  “We conclude from our review of the Supreme Court’s First 
Amendment jurisprudence that whereas the Free Exercise Clause guarantees a 
church’s freedom to decide how it will govern itself, what it will teach, and to 
whom it will entrust its ministerial responsibilities, it does not guarantee the right 
of its members to practice what their church may preach if that practice is 
forbidden by a neutral law of general application.”  (Catholic University, supra, 83 
F.3d at p. 463.)  In fact, the Legislature apparently takes a similar view of the 
breadth of Smith because it provided an exemption from the WCEA for churches.   
 
2.  The Two Faces of Entanglement 
 
Under venerable establishment clause precedent, however, the exemption 
itself is problematic.  To put it bluntly, the government may generally separate the 
religious from the secular to decide how it will dispense its benefits, but it cannot 
parse a bona fide religious organization into “secular” and “religious” components 
solely to impose burdens on the secular portion.  
 As 
noted, 
ante, the constitutional basis for the distinction seems 
indisputable.  The United States Supreme Court has recognized that government 
action may burden the free exercise of religion in two different ways:  “by 
interfering with a believer’s ability to observe the commands or practices of his 
faith [citations], and by encroaching on the ability of a church to manage its 
internal affairs.”  (Catholic University, supra, 83 F.3d at p. 460; see, e.g., Church 
of the Lukumi Babalu Aye, Inc. v. City of Hialeah (1993) 508 U.S. 520, 531-533 
(Lukumi); Kedroff v. St. Nicholas Cathedral, supra, 344 U.S. at p. 116 [free 
 
6

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exercise clause protects power of religious organizations “to decide for 
themselves, free from state interference, matters of church government as well as 
those of faith and doctrine”].) 
 
If Catholic Charities were a “religious employer” it would be exempt from 
the WCEA’s requirement to include coverage for contraceptives in its group 
healthcare policy.  Under the act, a religious employer must satisfy all of the 
following criteria:  “(A)  The inculcation of religious values is the purpose of the 
entity.  [¶]  (B)  The entity primarily employs persons who share the religious 
tenets of the entity.   [¶]  (C)  The entity serves primarily persons who share the 
religious tenets of the entity.   [¶]  (D)  The entity is a nonprofit organization as 
described in Section 6033(a)(2)(A)i or iii, of the Internal Revenue Code of 1986, 
as amended.”  (Health & Saf. Code, § 1367.25, subd. (b)(1).) 
 
As the majority notes, “Catholic Charities does not qualify as a ‘religious 
employer’ under the WCEA because it does not meet any of the definition’s four 
criteria.”  (Maj. opn., ante, at p. 5, italics added.)  But Catholic Charities would be 
a religious employer if the Legislature had not designed the exemption narrowly 
enough to exclude it.2  The plaintiffs contend the Legislature has “deliberately 
defined the Catholic Church in a manner entirely inconsistent with Catholic 
religious teaching, to exclude critical, constitutive elements of the Catholic 
Church—i.e., the Church’s healthcare, social service and educational ministries—
from the definition of ‘religious employer’ included in the exemption provisions.” 
                                              
2 
Earlier versions of the WCEA contained a broader conscience clause—
which Catholic Charities deemed acceptable—exempting bona fide religious 
employers and allowing religiously affiliated hospitals, universities, and social 
service agencies to opt out.  The current version of the act exempts churches, 
synagogues, mosques, temples, missions, parochial schools, seminaries and 
convents from the requirement to provide contraceptive coverage. 
 
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The high court “ ‘has long recognized that the government may (and 
sometimes must) accommodate religious practices and that it may do so without 
violating the Establishment Clause.’ ”  (Corporation of the Presiding Bishop v. 
Amos (1987) 483 U.S. 327, 334 (Amos).)  At the same time, acknowledging that 
churches often regard the community services provided by affiliated nonprofits as 
“a means of fulfilling religious duty and providing an example of the way of life a 
church seeks to foster” (id. at p. 344 (conc. opn. of Brennan, J.)), the court 
concluded the case-by-case determination of whether an affiliated nonprofit is 
religious or secular is inappropriate under the free exercise clause.  (Id. at pp. 341-
342 (conc. opn. of Brennan, J.) [“Religion includes important communal elements 
for most believers.  They exercise their religion through religious organizations 
and these organizations must be protected by the [Free Exercise] Clause. . . .  
[R]eligious activity derives meaning in large measure from participation in a 
larger religious community”].) 
 Even 
after 
Smith, it seems quite clear the government may not discriminate 
among religions (Larson v. Valente (1982) 456 U.S. 228, 253) or engender a risk 
of politicizing religion (id. at pp. 253-254) or purport to exempt “religious” but not 
“secular” activities (Cantwell v. Connecticut (1940) 310 U.S. 296, 301; Espinosa 
v. Rusk (10th Cir. 1980) 643 F.2d 477, 480-481, affd. (1982) 456 U.S. 951).  In 
National Labor Relations Board v. The Catholic Bishop of Chicago (1979) 440  
U.S. 490 (Catholic Bishop), the National Labor Relations Board (NLRB) certified 
unions as bargaining agents for lay teachers in church-affiliated schools.  The 
NLRB asserted it was required to decline jurisdiction only when schools were  
“ ‘completely religious’ ” and not just “ ‘religiously associated.’ ”  (Id. at p. 493.)  
The Seventh Circuit Court of Appeals rejected the NLRB’s standard as a  
“ ‘simplistic black or white, purported rule’ ” which offered no guide to discretion.  
(Id. at p. 495.)  “ ‘The real difficulty is found in the chilling aspect that the 
 
8

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requirement of bargaining will impose on the exercise of the bishops’ control of 
the religious mission of the schools.’ ”  (Id. at p. 496.)  The Supreme Court, after 
acknowledging that the NLRB’s attempt to distinguish between “ ‘completely 
religious’ ” and “ ‘religiously associated’ ” was a recognition of its intrusion into 
areas protected by the religion clauses, construed the National Labor Relations Act 
so as to avoid deciding whether jurisdiction “was constitutionally permissible 
under the Religion Clauses of the First Amendment.”  (Catholic Bishop, at p. 499.)  
Nevertheless, the court expressed concern that NLRB jurisdiction would 
inevitably involve “inquiry into the good faith of the position asserted by clergy-
administrators and its relationship to the school’s religious mission,” and the “very 
process of inquiry” would impinge on rights guaranteed by the religion clauses.  
(Catholic Bishop, at p. 502.) 
 In 
Universidad Central de Bayamon v. NLRB (1st Cir. 1985) 793 F.2d 383, 
387, the NLRB sought to avoid the problem by exempting “ ‘pervasively 
sectarian’ ” schools.  The controlling opinion in Universidad Central de Bayamon 
found board jurisdiction posed just as great a risk as the Supreme Court envisioned 
in Catholic Bishop, supra, 440 U.S. 490.  “For the Board to exercise jurisdiction 
over an educational institution where ‘the inculcation of religious values is at least 
one purpose of the institution’ and ‘to promise that courts in the future will control 
the Board’s efforts to examine religious matters, is to tread the path that Catholic 
Bishop forecloses.’ ” (Univ. of Great Falls v. NLRB (D.C. Cir. 2002) 278 F.3d 
1335, 1342 (Great Falls), quoting Universidad Central de Bayamon v. NLRB, at 
p. 402.) 
 In 
Great Falls, the Court of Appeals for the District of Columbia rejected 
the NLRB’s latest effort—the “substantial religious character” test—because the 
multifaceted analysis created the same concerns as the approach rejected in 
Catholic Bishop.  Moreover, the court invoked a long line of precedents which 
 
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have made it clear that religious tests, inquiries into religious perspectives, or 
generally trolling through a person’s or institution’s religious beliefs is “ ‘not only 
unnecessary but also offensive.’ ”  (Great Falls, supra, 278 F.3d at pp. 1341-1342, 
quoting Mitchell v. Helms (2000) 530 U.S. 793, 828; Amos, supra, 483 U.S. 327, 
340, 345 (conc. opn. of Brennan, J.).) 
 
The court in Great Falls thus suggested a broad exemption which would 
avoid the pitfalls of having the government determine what is religious or how 
much religion is sufficient.  The court would exempt any school which purports to 
provide a religious environment; is organized as a nonprofit; and affiliated with, or 
owned, or operated, or controlled directly or indirectly by a recognized religious 
organization or entity whose membership is determined at least in part with 
reference to religion.  (Great Falls, supra, 278 F.3d at p. 1343.)  The point of this 
bright-line test was to avoid delving into religious doctrine or motive and to avoid 
coercing a religiously affiliated educational institution to alter its religious mission 
to meet regulatory demands.  (Id. at p. 1345.)  This approach responds to a 
longstanding concern that the religious liberty protected by the Constitution ought 
not to depend on a “determination by state authority as to what is a religious 
cause.”  (Cantwell v. State of Connecticut, supra, 310 U.S. at p. 307.) 
 
Of course, the cited cases are distinguishable.  The controversy here does 
not involve solicitation, or potential chilling effects, religious schools, 
administrative discretion, or ad hoc determinations.  In reality, this case is worse.  
Here we are dealing with an intentional, purposeful intrusion into a religious 
organization’s expression of its religious tenets and sense of mission.  The 
government is not accidentally or incidentally interfering with religious practice; it 
is doing so willfully by making a judgment about what is or is not religious.  This 
is precisely the sort of behavior that has been condemned in every other context.  
The conduct is hardly less offensive because it is codified.  Definition may be just 
 
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as pernicious as ongoing monitoring if its purpose is to suppress or burden 
religious conduct.  (Espinosa v. Rusk, supra, 634 F.2d at p. 481 [“The conception 
of religion entertained by the City . . . was that it had to be purely spiritual or 
evangelical.  Thus, the charitable activity of the church having to do with the 
feeding of the hungry or the offer of clothing and shelter to the poor was deemed 
subject to regulation.  This broad definition of secular is part of the problem”].) 
 
3.  The Meaning of Neutrality 
 
In theory, when religious liberties are at stake, the state is only neutral 
when it does not choose sides.  (Laycock, Religious Liberty as Liberty (1996) 7  
J. Contemp. Legal Issues 313 [“[T]he core point of religious liberty is that the 
government does not take positions on religious questions—not in its daily 
administration, not in its laws, and not in its Constitution either”].)  This would 
mean that the state may not prefer or seek to impose a particular normative view 
by squelching a competing religious perspective.  Genuine neutrality would “allow 
many different and contending voices to be represented in public discourse.”  
(McConnell, Why Is Religious Liberty the “First Freedom”?, supra, 21 Cardozo 
L.Rev. at p. 1262.) 
 
In the present controversy, one side posits that sex is an aspect of 
autonomy, a vital human function in which men and women should be able to 
engage, enjoying their sexuality “free from anxiety.”  (Hayden, Gender 
Discrimination Within the Reproductive Health Care System:  Viagra v. Birth 
Control (1999) 13 J.L. & Health 171, 181.)  This may in fact be the view of a 
majority of American adults.  The Catholic Church’s view, in contrast, deems all 
forms of nonmarital sex immoral, and views sex within marriage as a unitive, 
procreative, and sacred reflection of a spiritual, emotional, and biological reality 
that comes complete with reproductive anxiety.  (See George & Bradley, 
Marriage and the Liberal Imagination (1995) 84 Geo. L.J. 301-320.)  This is a 
 
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perspective many people would disparage as archaic.  Several of the legislators 
debating the WCEA seemed to think so.3 
 
The Catholic Church purports to be one of those different and contending 
voices, a church which “has never envisioned a sharp divide between the Church 
and the world, the spiritual and the temporal, or religion and politics.  For the 
Church, the internal spiritual life of its members and institutions must always 
move outward as a sign and instrument for the transformation of the larger 
society.”  (Brady, Religious Organizations and Mandatory Collective Bargaining 
Under Federal and State Labor Laws:  Freedom From and Freedom For, supra, 
49 Vill. L.Rev. at p. 157.) 
 
Petitioner complains the narrow exemption was designed to lend the state’s 
“considerable weight to the dissenting side of a conflict within the church about 
the legitimacy of contraceptive practice—under the banner of protecting the 
‘rights’ of those who disagree . . . and to deny the church exemption based on the 
allegedly unpopular nature of a church doctrine that diverges from contemporary 
cultural mores.”  In petitioner’s words, the state’s “action has the effect of 
declaring the Catholic hierarchy’s stand ‘heresy’ in the eyes of secular culture.” 
 
Of course, practice always diverges from theory.  In contemporary 
American society, the government does take sides on policy issues.  The First 
Amendment precludes the government from taking sides if the dispute involves 
                                              
3 
(See, e.g., Remarks of Sen. Speier, Sen. Floor Debate on Sen. Bill No. 41 
(1999-2000 Reg. Sess.) Apr. 12, 1999, pp. 7-8 [floor statement of Senator Speier 
asserting that since 75 percent of all California Catholic hospitals already provide 
contraception coverage, the “issue has already been resolved . . . and its time has 
come”]; Remarks of Sen. Speier, Sen. Floor Debate on Assem. Bill No. 39 (1999-
2000 Reg. Sess.) Sept. 7, 1999, p. 7 [floor statement of Senator Speier arguing that 
“59 percent of all Catholic women of childbearing age practice contraception 
[and] 88 percent of Catholics believe . . . that someone who practices artificial 
birth control can still be a good Catholic,” and commenting, “I agree with that.  I 
think it’s time to do the right thing” (italics added)].) 
 
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internal church governance, but that leaves an area of overlap where the 
religiously dictated conduct of churches operating in the world comes into conflict 
with public policy.  The question then is whether the coercive force of the law may 
be brought to bear to compel a religious organization that holds an alternative 
view, based on religious scruples, to support a hostile and competing vision of the 
good. 
 
 
a.  Religious bigotry 
 
Smith could be read, as the majority apparently reads it, to suggest that 
religion is not entitled to constitutional protection unless the government action 
expressly and specifically targets religious expression.  Under this interpretation, 
protection for religious liberty requires proof of religious bigotry, i.e., proof that 
government officials acted out of anti-religious motives.  Thus, Smith—even as 
modified by Lukumi—would prohibit infringements of religious liberties only if a 
statute has the “object or purpose of . . . suppress[ing] religion or religious 
conduct” or involves “[o]fficial action that targets religious conduct for distinctive 
treatment.”  (Lukumi, supra, 508 U.S. at pp. 533-534.)  Since this statute imposes 
a mandate on all employers that provide prescription coverage, it arguably does 
not target religious conduct.  On one level, religious interests and secular interests 
are treated with equal dignity, and since the mandate provides an escape hatch, 
Catholic Charities’ attempt to claim specifically unequal treatment faces 
formidable obstacles.  Consequently, the majority finds Catholic Charities has 
failed to prove an anti-religious motive and the statute is neutral. 
 
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b.  Objects and effect 
 
There is, however, more than one way to look at neutrality.  As Lukumi 
explains it, “[f]acial neutrality is not determinative. . . .  The [free exercise] clause 
‘forbids subtle departures from neutrality’ [citation] and ‘covert suppression of 
particular religious beliefs.’ ”  (Lukumi, supra, 508 U.S. at p. 543.)  “Apart from 
the text, the effect of a law in its real operation is strong evidence of its object.”  
(Id. at p. 535.)  “[I]f the object of the law is to infringe upon or restrict practices 
because of their religious motivation, the law is not neutral [citation]; and it is 
invalid unless it is justified by a compelling interest and is narrowly tailored to 
advance that interest.”  (Id. at p. 533.)  “The Free Exercise Clause ‘protect[s] 
religious observers against unequal treatment.’ ”  (Lukumi, at p. 543.)  But equality 
in the context of religious liberty must be broadly defined.  In effect, the general 
applicability requirement is needed to ensure neutrality across broad categories of 
regulation.  Pursuant to Lukumi, if other activities which cause comparable harm 
to the same governmental interests are not regulated, the law is not generally 
applicable.  Thus, Lukumi makes it clear that strict scrutiny is required if a law is 
not neutral—and it considers the question of neutrality broadly. 
 
In this case, for instance, defendants argue that Catholic Charities’ ability to 
opt out, i.e., to choose not to provide any prescription coverage, obviates any 
concern about infringement.  Catholic Charities insists it should not be forced to 
relinquish its vision of appropriate employee relations to preserve its right to 
object to the use of contraceptives.  From the Church’s perspective, to demand that 
contraception be funded, despite bona fide religious objections, is to take sides, to 
abandon the commitment to public neutrality.  In this sense, the WCEA, with its 
grudging religious exemption, may not be neutral.  The majority’s response that 
the WCEA’s narrow exemption is an accommodation and not an imposition seems 
entirely unresponsive. 
 
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In the whole scheme of things, the risk associated with allowing 
government to impose a stifling orthodoxy in pursuit of the good society may 
greatly outweigh the small harm of tolerating heterodoxy in this circumstance.4 
At oral argument, counsel indicated the Catholic Church, including Catholic 
Charities, employs fewer than 60,000 of California’s millions of employees.5  
                                              
4 
This does not mean that the government may never limit what religious 
organizations can do.  There are truly neutral laws which may be applied; there are 
aggressive interventions which are necessary to prevent harm.  (See, e.g., Walker 
v. Superior Court (1988) 47 Cal.3d 112, 139 [finding Christian Scientist who did 
not seek medical treatment for her child liable for child’s death, notwithstanding 
the “religious infringement of significant dimensions,” since state’s interest is 
compelling and child endangerment statute is narrowly tailored]; Brady, Religious 
Organizations and Mandatory Collective Bargaining Under Federal and State 
Labor Laws:  Freedom From and Freedom For, supra, 49 Vill. L.Rev. at p. 161 
[“In rare cases, limitations on the freedom of religious organizations may be 
necessary.  For example, if a religious group experiments with practices that 
endanger the lives of its employees or threaten them with serious bodily injury, 
interference may be justified”]; Laycock, Towards a General Theory of the 
Religion Clauses: The Case of Church Labor Relations and the Right to Church 
Autonomy (1981) 81 Colum. L.Rev. 1373, 1406 [“Courts have intervened to 
protect church members from serious bodily harm even when they voluntarily 
submitted”].)  In contrast, what this case presents is essentially a clash of ideas.   
5  
These numbers are approximate.  At oral argument, Catholic Charities counsel 
asserted that the Catholic Church employs fewer than 50,000 people, including those 
in holy orders.  Proponents claim there are 52,000 employees in Catholic-affiliated 
hospitals alone.  Using 60,000 as a point of reference, it appears all Catholic Church 
employees in California represent less than .5 percent of the California workforce, and 
female employees of the Catholic Church represent about the same percentage of the 
number of working women of childbearing age in California.  According to recent 
Bureau of Labor Statistics publications, the current number of California adults 
employed in nonfarm jobs is approximately 14.4 million.  (Bur. of Lab. Statistics, 
U.S. Dept. of Lab. News Release No. 04-81 (Jan. 27, 2004) Employees on nonfarm 
payrolls by state and selected industry sector, table 5<http://www.bls.gov/ 
news.release/pdf/laus.pdf> [as of Mar. 1, 2004].)  A little less than half are women.  
Extrapolating from national statistics, around 5 million of that total will be women 
between 16 and 45.  (Bur. of Lab. Statistics, U.S. Dept. of Lab. News Release No. 04-
120 (Feb. 6, 2004) Selected employment indicators, table A-6 <http://www.bls.gov/ 
 
(footnote continued on next page) 
 
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Some of the Church’s employees belong to religious orders and are presumably 
fully in agreement with the church’s position.  Some are men, some are women no 
longer capable of childbearing, and some are spouses of people employed by other 
companies who are covered by their spouses’ health plans.  Of the women of 
childbearing age who remain, and to whom contraceptive coverage is a critical 
concern, none are faced with a pervasive practice which would prevent them from 
finding more congenial employment.6  The existence of WCEA’s mandate—to 
which the vast majority of California employers apparently have no religious 
objection—enhances their employment options.  In fact, the defection of talented 
                                                                                                                                                              
 
(footnote continued from previous page) 
 
newsrelease/pdf/empsit.pdf> [as of Mar. 1, 2004].)  Even assuming these numbers 
need to be adjusted upward or downward for accuracy, an exemption for Catholic 
Charities would seem to have a negligible effect. 
6  
The majority cites language from United States v. Lee, supra, 455 U.S. 252, 
for the proposition that allowing an employer to be exempt from a neutral law 
“operates to impose the employer’s religious faith on employees.”  (Id. at p. 261.)  
This is a curious statement.  In Lee, both the employer and the employee were 
members of the Old Order Amish and all agreed they should be exempt from 
Social Security and unemployment insurance taxes.  Even if that were not the 
case, it is not clear how an employer is in a position to impose anything on its 
employees to which they object.  (U.S. Const., 13th Amend. [prohibiting slavery 
or involuntary servitude].)  Only the state, which holds the monopoly on coercive 
force, can compel adults to remain where they do not choose to be and do what 
they do not wish to do. 
 In 
Smith v. FEHC, supra, 12 Cal.4th 1143, this court considered whether a 
state law prohibiting discrimination against unmarried cohabitating couples 
burdened the free exercise of a landlady who objected to renting to the couple on 
religious grounds.  A majority of the court concluded Smith’s rights were not 
substantially burdened because she could simply abandon the rental business and 
redeploy her capital.  If we reject the challenges of some religious claimants 
because they have other options, what logic compels us to assume that employees 
have no choice? 
 
 
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female employees may cause Catholic Charities to reconsider its position.  Such a 
result has no First Amendment implications. 
 
A substantial amount of federal case law supports Catholic Charities’ claim 
that the Legislature’s attempt to draw distinctions between the religious and 
secular activities of a single religious entity is an impermissible government 
entanglement in religion.  I am inclined to agree.  Such an action is 
constitutionally invalid and that ends the discussion.  If, however, the existence of 
the narrow exemption simply shows the statutory scheme is not neutral in 
operation or effect, it is invalid only if it fails strict scrutiny. 
C. Strict 
Scrutiny 
 
Strict scrutiny is not what it once was.  Described in the past as “strict in 
theory and fatal in fact” (Gunther, Foreword:  In Search of Evolving Doctrine on a 
Changing Court: A Model for Newer Equal Protection (1972) 86 Harv. L.Rev. 1, 
8), it has mellowed in recent decades (see, e.g., Grutter v. Bollinger (2003) 539 
U.S. 306 [123 S.Ct. 2325, 2338] [holding state law school’s race-based affirmative 
action program survived strict scrutiny and noting that “[s]trict scrutiny is not 
‘strict in theory, but fatal in fact’ ”]). 
 
If recent precedent is any guide, a state’s interest is compelling if the state 
says it is.  Thus, consistent with federal precedent compelling interest now seems 
more or less coextensive with the state’s asserted exercise of police power.   
 
1.  Compelling State Interest 
 
Unquestionably, the desire to eradicate invidious discrimination is a 
compelling state interest.  But is the desire to force conformity on a single 
employer that objects to contraception on religious grounds also a compelling state 
interest?  In the latter case, the state is not dealing with invidious discrimination; it 
is trying to prevent a disparate impact.  Catholic Charities does not discriminate 
because of an animus against women.  It opposes all forms of birth control, except 
 
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abstinence, whether for men or women, whether prescription or over-the-counter, 
whether surgical, oral, or mechanical. 
 
2.  Narrow Tailoring 
 
The WCEA defines as religious only those organizations for which the 
inculcation of religious values is the sole purpose of the entity, that primarily 
employ only adherents of their own faith tradition, that primarily serve only 
people who share their religious tenets, and that qualify as nonprofit organizations 
described in section 6033(a)(2)(A)i or iii of the Internal Revenue Code of 1986. 
 
This is such a crabbed and constricted view of religion that it would define 
the ministry of Jesus Christ as a secular activity.7  The stinginess of the exemption 
makes the structure of the act all the more baffling.  The mandate applies only to 
employers that provide prescription coverage.  Thus, Catholic Charities can avoid 
the mandate by dropping the coverage.  The state wants to make sure that women 
are not burdened more than others.  Where employers cooperate, the WCEA will 
reduce the inequitable financial burden of healthcare for women.  If religiously 
affiliated employers are serious about their objections, however, women who work 
for those employers could actually be worse off. 
 
The only reasons given for narrowing the exemption so drastically is the 
alleged concern that the exception could “swallow up” the rule because the 
numbers of employees who work for secular organizations affiliated with 
                                              
7  
Even churches that do not operate schools, hospitals, or social service 
agencies would have trouble with the WCEA’s religious test.  Not all religions 
proselytize.  Those that do necessarily reach out to people who do not share their 
beliefs.  Christian denominations, for example, are commanded to seek and save 
the lost.  “Go ye into all the world and teach the gospel to every creature.”  (Mark 
15:15.)  Catholic Charities suggest that some Catholic congregations might be 
“ineligible for the exemption depending . . . upon the demographics of a particular 
diocese, the fortuitous nature of hiring patterns, and the particular application of 
the theological criteria . . . .” 
 
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religious entities could easily approach several hundred thousand; the exemption 
might deprive thousands of employees of access to nondiscriminatory health and 
disability insurance; and a desire exists to extend coverage to as many people as 
possible.  There are a few problems with this litany.  First, the act, as its structure 
demonstrates and as the majority candidly admits, has nothing to do with access or 
extending coverage.  “[T]he principal purpose of the WCEA . . . is not to facilitate 
access to contraceptives but to eliminate a form of gender discrimination in the 
provision of health benefits.”  (Maj. opn., ante, at pp. 43-44.)  Moreover, the 
record provides no support for the claim that the exemption potentially affects 
several hundred thousand employees. 
 
Furthermore, employers have the option of self-insuring.  The Employee 
Retirement Income Security Act preempts state regulation of self-insured 
companies and “prohibits states from mandating benefits or defining 
discrimination in self-insured employee benefit plans more broadly than federal 
law.”  (Law, Sex Discrimination and Insurance for Contraception (1998) 73 
Wash. L.Rev. 363, 395; 29 U.S.C. § 1001 et seq.)  Such employers would not only 
not be subject to mandatory prescription coverage, they would not be subject to 
any of California’s more restrictive insurance regulations.  Arguably, the existence 
of these secular exemptions supports a religiously-affiliated-employer exemption 
even under Smith.  The state would also need to show its refusal to countenance a 
religious exception, in a regulatory arena rife with exceptions, is not “official 
action that targets religious conduct for distinctive treatment.”  (Lukumi, supra, 
508 U.S. at pp. 533-534.) 
II. 
 
Thus, whether the WCEA would survive strict scrutiny—even under the 
relaxed federal standard—seems a much closer question than the majority 
acknowledges.  But there may be other good reasons to rely on independent state 
 
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grounds.  Changes in the interpretation of the federal charter are not only 
becoming more frequent, the balancing test, and the standards applied to them, are 
shifting.  Instead of applying Smith, we might view it as effectively returning free 
exercise questions to the states. 
A. 
A Document of Independent Force 
 
“We may take it for granted that the meaning of California Constitution 
article I, section 4, . . . is not dependent on the meaning of any provision of the 
federal Constitution.  The state charter declares in so many words  that ‘[r]ights 
guaranteed by this Constitution are not dependent on those guaranteed by the 
United States Constitution.’  (Cal. Const., art. I, § 24.)”  (Smith v. FEHC, supra, 
12 Cal.4th at p. 1177.)  “Respect for our Constitution as ‘a document of 
independent force’ [citation] forbids us to abandon settled applications of its terms 
every time changes are announced in the interpretation of the federal charter.”  
(People v. Pettingill (1978) 21 Cal.3d 231, 248, quoting People v. Brisendine 
(1975) 13 Cal.3d 528, 549-550.) 
 
This is true even when the language is identical to the federal Constitution, 
but is particularly true when the language differs.  (See, e.g., Golden Gateway 
Center v. Golden Gateway Tenants Assn. (2001) 26 Cal.4th 1013, 1019 [“Unlike 
the United States Constitution, which couches the right to free speech as a limit on 
congressional power (see U.S. Const., 1st Amend.), the California Constitution 
gives ‘[e]very person’ an affirmative right to free speech.  [Citation.]  
Accordingly, we have held that our free speech clause is ‘more definitive and 
inclusive than the First Amendment’ ” (fn. omitted)].) 
 
Similarly, although we have said California’s establishment clause is 
coextensive with the federal provision (East Bay Asian Local Development Corp. 
v. State of California (2000) 24 Cal.4th 693, 718), California’s free exercise clause 
guarantees “free exercise and enjoyment of religion without discrimination or 
 
20

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preference” and specifies that “liberty of conscience does not excuse acts that are 
licentious or inconsistent with the peace and safety of the state.”  (Cal. Const., art. 
I, § 4.)  We do not have to decide that this language literally embodies the strict 
scrutiny test.  The drafting history of California’s free exercise clause is not clear 
enough to resolve the question definitively.  Although the proponents of the 
licentious acts clause may simply have wanted to preserve the ability of the state 
to regulate specific practices they considered immoral or dangerous (Browne, Rep. 
of the Debates in Convention of Cal. on Formation of State Const. (1850) p. 39), 
that does not mean they thought the language was otherwise synonymous with the 
language of the federal Constitution. 
B. 
The Compelling State Interest Analysis 
 
The majority carefully avoids deciding whether strict scrutiny would be 
required under the California Constitution.  Other states with very similar 
constitutional liberty of conscience clauses have found that infringement requires 
strict scrutiny.  (See, e.g., Humphrey v. Lane (Ohio 2000) 728 N.E.2d 1039, 1043 
[holding that under the Ohio Constitution, “the standard for reviewing a generally 
applicable, religion-neutral state regulation that allegedly violates a person’s right 
to free exercise of religion is whether the regulation serves a compelling state 
interest and is the least restrictive means of furthering that interest” and finding the 
regulation at bar not the least restrictive]; State v. Hershberger (Minn. 1990) 462 
N.W.2d 393 [under the Minnesota Constitution, neutral motor vehicle statute, 
which burdened Amish religious exercise, failed compelling state interest test 
since state failed to show lack of reasonable alternative means]; First Covenant 
Church v. City of Seattle (Wash. 1992) 840 P.2d 174, 187 [statute that burdened 
free exercise failed state compelling interest test under Washington Constitution 
since the state’s interest was not of sufficient magnitude to outweigh free exercise 
of religion].) 
 
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At the very least, the constitutional weight of the state’s interest must be 
affected by the size and severity of the problem the state is attempting to solve.  
To authorize the state to use a howitzer to smite a gnat should be no part of our 
constitutional jurisprudence.  Where strict scrutiny applies, the state “may abridge 
religious practices only upon a demonstration that some compelling state interest 
outweighs the defendants’ interests in religious freedom.”  (People v. Woody 
(1964) 61 Cal.2d 716, 718 (Woody).) 
 
It may also be true that “[s]ection 4 has not played an independent role in 
free exercise claims” (Grodin et al., The Cal. State Constitution:  A Reference 
Guide (1993) p. 44), but does that mean it should remain dormant?  In Woody, the 
court relied on the First Amendment rather than the California provision, but in 
doing so, the court applied strict scrutiny and insisted on a searching inquiry.  
Under California law—at least up to now—the compelling state interest test had 
bite and required the court to “weigh[] the competing values represented . . . on the 
symbolic scale of constitutionality.”  (Woody, supra, 61 Cal.2d at p. 727.)  
Untested assertions of a possible deleterious effect on a statutory scheme were not 
sufficient.  (Id. at p. 724.)  In Woody, the court concluded that uniform 
enforcement of neutral criminal drug laws (similar to the laws at issue in Smith) 
was not a compelling reason to intrude upon sincere religious practices.  In 
explaining why the interest in drug enforcement—while undeniably important—
was not compelling enough, the court said:  “In a mass society, which presses at 
every point toward conformity, the protection of self-expression, however unique, 
of the individual and the group becomes ever more important.  The varying 
currents of the subcultures that flow into the mainstream of our national life give it 
depth and beauty.”  (Woody, at p. 727.)  These concerns should be heightened 
when the government seeks to redefine the core theology of religious 
organizations. 
 
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Under the standard enunciated in Woody, the state has actually failed to 
meet its burden.  The whole debate ensues because the state found that 
“approximately 10 percent of commercially insured Californians do not have 
coverage for prescription contraceptives.”  (Maj. opn., ante, at p. 2.)  Presumably 
that 10 percent includes both men and women.  Still, it means that 90 percent of 
Californians who are commercially insured do have such coverage!  The insurance 
gap itself is not large, and Catholic Church employers can constitute only a small 
percentage of that small percentage. 
 
Moreover, even if we assume the interests at issue here are both compelling 
and of equal weight, the Legislature’s refusal to grant a broader exemption—one 
which would not embroil the government in the unseemly task of deciding what is 
“religious”—is inexplicable.  The state has produced no substantial evidence that 
the exemption of Catholic Charities from this particular mandate would render the 
whole scheme ineffective or would be so administratively burdensome as to 
preclude enforcement.  As petitioner poses the question:  “[I]f closing the Catholic 
gap [was] not the problem,” how can “ ‘granting an exemption to Catholic 
employers’ . . . ‘defeat the purpose of the bill’ ”?  There has been no showing that 
the interests served by the WCEA—which focuses on a modest 10 percent gap in 
coverage—cannot be achieved by less restrictive means. 
CONCLUSION 
 
Equality is one of those words, like justice, like freedom, which no one is 
against.  But the invocation of the word “equality” often reduces analysis to empty 
platitudes.  It is important to remember that in America we seek equality because 
it is a concomitant of freedom.  When it is possible to accommodate both, that is 
what we should do. 
 
 
 
 
 
 
 
 
BROWN, J. 
 
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See last page for addresses and telephone numbers for counsel who argued in Supreme Court. 
 
Name of Opinion Catholic Charities v. Superior Court 
__________________________________________________________________________________ 
 
Unpublished Opinion 
Original Appeal 
Original Proceeding 
Review Granted XXX 90 Cal.App.4th 425 
Rehearing Granted 
 
__________________________________________________________________________________ 
 
Opinion No. S099822 
Date Filed: March 1, 2004 
__________________________________________________________________________________ 
 
Court: Superior 
County: Sacramento 
Judge: Joe S. Gray 
 
__________________________________________________________________________________ 
 
Attorneys for Appellant: 
 
Law Office of James Francis Sweeney, Sweeney & Grant, James F. Sweeney, Eric Grant; Tobin & Tobin, 
Paul E. Gaspari and Lawrence R. Jannuzzi for Petitioner. 
 
Gaglione, Coleman & Greene, Robert J. Gaglione; and Michael D. Ramsey for Catholic Charities USA as 
Amici Curiae on behalf of Petitioner. 
 
Diepenbrock & Costa, Law Offices of Daniel P. Costa, Daniel P. Costa; and William W. Bassett for 
California Catholic Conference as Amicus Curiae for Petitioner. 
 
Richard D. Ackerman and Gary G. Kreep for Life Legal Defense Fund as Amicus Curiae on behalf of 
Petitioner. 
 
Reed & Brown, Stephen W. Reed; Stuart J. Lark and Gregory S Baylor for Christian Legal Society, Focus 
on the Family, Family Research Council and Ethics and Religious Liberty Commission of the Southern 
Baptist Convention as Amici Curiae on behalf of Petitioner. 
 
McNicholas & McNicholas and John P. McNicholas for the Lutheran Church-Missouri Synod, The 
International Church of the Foursquare Gospel, the Worldwide Church of God and the United States 
Conference of Catholic Bishops as Amici Curiae on behalf of Petitioner. 
 
Alan J. Reinach; Alan E. Brownstein; Bassi, Martinin & Blum and Fred Blum for California Coalition for 
the Free Exercise of Religion as Amicus Curiae on behalf of Petitioner. 
 
Sidley & Austin, Sidley Austin Brown & Wood, Jeffrey A. Berman, James M. Harris, Gene C. Schaerr, 
Michael S. Lee, Rebecca K. Smith and Eric A. Shumsky for Adventist Health, Alliance of Catholic Health 
Care, Association of Christian Schools International, Catholic Charities of California, Catholic Charities 
USA, Inc., Loma Linda University and Loma Linda University Medical Center as Amici Curiae on behalf 
of Petitioner. 
 
 
 
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Page 2- counsel continued - S099822 
 
Attorneys for Respondent: 
 
No appearance for Respondent. 
 
Attorneys for Real Party in Interest: 
 
Bill Lockyer, Attorney General, Pamela Smith-Steward, Chief Assistant Attorney General, Manuel M. 
Medeiros and Andrea Lynn Hoch, Assistant Attorneys General, Catherine M. Van Aken, Meg Halloran, 
Christopher Krueger, Kenneth R. Williams, Kathleen W. Mikkelson, Daniel G. Stone and Timothy M. 
Muscat, Deputy Attorneys General, for Real Parties in Interest. 
 
Catherine Weiss, Julie Sternberg; Margaret C. Crosby, Ann Brick; Jordan Budd; Rocio L. Cordoba and 
Mark Rosenbaum for American Civil Liberties Union, American Civil Liberties Union of Northern 
California, ACLU Foundation of Southern California and American Civl Liberties Union of San Diego and 
Imperial Counties as Amici Curiae on behalf of Real Parties in Interest. 
 
Rosina K. Abramson, Steven M. Freeman, Tamar Galatzan, Erica Broido; Rachel Zenner; Doug Mirell, 
Daniel Sokatch; Jerome J. Shestack, Jeffrey P. Sinensky, Kara H. Stein, Danielle A. Samulon; Morrison & 
Foerster, J. Michael Stusiak, Sunil R. Kulkarni and Felton T. Newell for Anti-Defamation League, 
Hadassah, The American Jewish Committee and The Progressive Jewish Alliance as Amici Curiae on 
behalf of Real Parties in Interest. 
 
Eisen & Johnston Law Corporation, Jay-Allen Eisen and Marian M. Johnston for Assemblymember Robert 
J. Hertzberg and Senator Jackie Speier as Amici Curiae on behalf of Real Parties in Interest. 
 
Edward Tabash; Ayesha Khan; and Steve K. Green for Americans United for Separation of Church and 
State as Amicus Curiae on behalf of Real Parties in Interest. 
 
Nancy M. Solomon for California Women’s Law Center, California Women Lawyers, Women Lawyers 
Association of Los Angeles and Queen’s Bench Bar Association of the San Francisco Bay Area as Amici 
Curiae on behalf of Respondent and Real Parties in Interest. 
 
Eve C. Gartner, Donna Lee; Roberta Riley; Lilly Spitz; and Deborah Baumgarten for Planned Parenthood 
Affiliates of California, California Planned Parenthood Education Fund, All Planned Parenthood Affiliates 
and Planned Parenthood Federation of America as Amici Curiae on behalf of Respondent and Real Parties 
in Interest. 
 
Catherine I. Hanson and Astrid G. Meghrigian for the American College of Obstetricians and 
Gynecologists and the California Medical Association as Amici Curiae on behalf of Respondent and Real 
Parties in Interest. 
 
McCutchen, Doyle, Brown & Enersen, Beth H. Parker and Alison R. Beck for Catholics for a Free Choice, 
California Catholics for a Free Choice, Catholics Speak Out, Dignity/USA, Vermont Catholics for a Free 
Conscience, Women’s Alliance for Theology, Ethics and Ritual and Women’s Ordination Conference as 
Amici Curiae on behalf of Respondent and Real Parties in Interest. 
 
 
 
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Page 3- counsel continued - S099822 
 
Attorneys for Real Party in Interest: 
 
Bebe J. Anderson; Farella Braun & Martel, Claudia A. Lewis, Sarah L. Kowalski; and Ronora Pawelko for 
The California Abortion and Reproductive Rights Action League, The Caral Pro-Choice Education Fund, 
The Center for Reproductive Law and Policy, The Education Fund of Family Planning Advocates of New 
York State, Inc., and National Women’s Law Center as Amici Curiae on behalf of Respondent and Real 
Party in Interest. 
 
Christyne L. Neff and Barry Broad for International Union, AFL-CIO & CLC, Coalition of Labor Union 
Women, Service Employees International Union, Local 535 and California Nurses Association as Amici 
Curiae on behalf of Respondent and Real Parties Interest. 
 
 
 
 
 
 
 
 
 
 
 
 
 
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Counsel who argued in Supreme Court (not intended for publication with opinion): 
 
James F. Sweeney 
Sweeney & Grant 
Wells Fargo Center 
400 Capitol Mall, Suite 900 
Sacramento, CA  95814 
(916) 341-0321 
 
Timothy M. Muscat 
Deputy Attorney General 
1300 I Street 
Sacramento, CA  94244-2550 
(916) 324-5502 
 
 
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