Since last October, authorized experts and business leaders have been watching and waiting for the U.S. Supreme Court to hand down their decision just about the most high-profile business law cases in recent years.
Late in June, on the very last day of the current term. our prime court published its its ruling in Burwell v. Hobby Lobby. The matter: whether a closely-held, for-profit corporation could refuse based on the private owners’ personal religious convictions against birth control, to offer contraception coverage to the employees as mandated from the federal regulations when the 2010 Affordable Care Act. By a razor-thin, 5-4, majority vote, the Supreme Court answered that it could.
The four dissenting justices disagreed, strenuously, on both the result as well as the rationale. However, people and media attention which has been given to this significant Supreme Court opinion has almost overshadowed the reality that – for the majority of small and mid-sized businesses – it will have no impact in any way.
The Decision in a Nutshell – Two families, the Hahns and also the Greens, own a total of three companies. The Hahns and their children own and control Conestoga Wood Specialties (cabinets), whilst the Greens and their children own and control all the Hobby Lobby closing times. One of the Greens’ sons also owns an affiliated Christian bookstore chain.
Though these for-profit businesses meet the meaning of “closely held” corporations that is certainly, (five or fewer shareholders) these are hardly what most people would consider to be small enterprises. The Hobby Lobby chain operates some 500 locations nationwide with almost 13,000 employees. The bookstore firm, Mardel, has about 35 stores plus some 400 employees. Conestoga has about 950 employees.
The families argued the Health & Human Services Department regulations mandating birth control coverage violated their rights underneath the federal Religious Freedom Restoration Act as well as the First Amendment. One of many, complex issues decided was whether a for-profit company could “engage in religious exercise.”
Five from the justices (Kennedy, Roberts, Scalia, Thomas, and Alito) ruled these families’ rights are violated by the contraception mandate, which it “substantially burdened their exercise of religion,” and that HHS “had not demonstrated a compelling desire for enforcing the mandate against them,” or proved that this mandate was the “least restrictive means” of furthering a compelling governmental interest.
Justice Samuel Alito, writing for the majority, indicated that this ruling “… put on closely held corporations” and, in a concurring opinion, Justice Anthony Kennedy noted that it is intended to be a narrow in scope.
Why Many Businesses Will Likely Be Unaffected By This Ruling. Legally, this decision does not affect the majority of American businesses and, particularly, on family-owned firms. First, there is absolutely no “employer mandate” in any way under the Affordable Care Act for just about any business with fewer than 50 employees. These firms happen to be exempt and possess no requirement to supply workers with any medical health insurance coverage whatsoever. Furthermore, while the great most of small enterprises in the usa (about 78%) are family owned, only about 2 percent of small companies have 50 or even more employees.
So, for most closely held corporations, this Supreme Court case, however newsworthy, is not relevant. Second, even before the passage and implementation from the Affordable Care Act, the vast majority of businesses, including small and midsized firms, already offered the mandated contraceptive coverage. Over 70% of U.S. employers not associated with religious institutions included birth control in their company health plans. Even for businesses with less than 200 employees, that figure was over 60%.
Third, the Affordable Care Act already exempts religious for-profit corporations in addition to nonprofit corporations using this coverage mandate.
For Affected Companies, You can find Broad Implications – This ruling will affect a relatively few closely held corporations whose private owners elect to assert they hold “sincerely held religious beliefs” against contraception. However, wjdqpc Court’s majority opinion is not really exactly clear how these religious convictions are to be measured or proved.
In her own blistering dissent, Justice Ruth Bader Ginsburg predicted this opinion could eventually allow “businesses to opt out of any law (saving only tax laws) they judge incompatible with their sincerely held religious beliefs.”
Other critics, including many legal experts, are involved about its broader implications, and whatever they describe being a “slippery slope” of possible religious challenges to a variety of government regulations.