“LGBTQ+ Want Not Apply” | The Regulatory Overview

In a ruling last week, the U.S. Supreme Court moved closer to allowing LGBTQ+ discrimination.

In a surge of recent court cases, businesses open to the public—in industries ranging from photography to florists, and wedding services to foster care placement—have invoked constitutional rights to refuse to serve LGBTQ+ people. The most prominent case to date was Masterpiece Cakeshop v. Colorado Civil Rights Commission, a 2018 case that involved a bakery asserting the right to refuse to sell a wedding cake to a gay couple.

Today, court cases in which businesses claim a right to deny employment to LGBTQ+ people in the face of antidiscrimination regulations are similarly accumulating following the Supreme Court’s ruling last year in Bostock v. Clayton County, Georgia. The Court in Bostock held that Title VII of the Civil Rights Act of 1968—the federal employment nondiscrimination law—forbids discrimination against employees for being gay or transgender under the Act’s prohibition on discrimination “because of … sex.”

Although in some sense these cases are a new and important development, they also form part of a larger arc of entities claiming that they have the right to refuse service or employment to certain groups—such as Black people, immigrants, or women—that reaches back at least a hundred years. Over many decades, the Supreme Court considered and rejected the arguments of employers and public accommodations, such as restaurants and hotels, that claimed constitutional exemptions from antidiscrimination laws.

After the passage of the Civil Rights Act of 1968, which prohibited discrimination in both employment and public accommodations, the Supreme Court rejected the argument of an Atlanta motel that the Fifth Amendment gave it the right to refuse service to Black customers. The Court similarly rejected the contention of the prominent law firm King & Spalding that the First Amendment protected its freedom of association right to make only men, not women, partners. The Supreme Court described as “patently frivolous” a barbeque restaurant’s argument that the Civil Rights Act of 1968 was invalid because the requirement to serve Black patrons assertedly “‘contravenes the will of God’ and constitutes an interference with the ‘free exercise of the Defendant’s religion.’” And in two cases—one involving a federal law that required private schools to desegregate, and another involving the tax-exempt status of Bob Jones University, which prohibited interracial dating and marriage as part of its religious mission—the Court held that private schools do not have constitutional rights to adopt racially discriminatory policies or admissions practices.

These decisions made two related moves. First, they restored the common law duty of businesses open to the public to serve the public on a nondiscriminatory basis. This duty prevailed before the Civil War but was abrogated after Reconstruction by racially discriminatory southern laws. Second, these decisions reflected the view that schools and employers are institutions that are open to the public and critical for public participation in what it later described as the basic “transactions and endeavors that constitute ordinary civic life in a free society.”

Masterpiece again raised this question of whether the Constitution protects a right to refuse service or employment to a class of people on religious or moral grounds. Importantly, in addition to a free exercise of religion claim, the cakeshop made a free speech claim. Masterpiece argued that it could not be required to sell a cake to a gay couple because doing so would compel it to express a message of support for gay marriage.

Court watchers speculated that the Supreme Court might change course in Masterpiece from its consistent rejection of such claims because, for over three decades, the Court had adopted an increasingly robust and libertarian view of the freedom of speech, particularly in economic life. The Court had expanded the sorts of activities that are protected as “speech” or expression and are subject to heightened judicial review.

By contrast, free exercise jurisprudence had remained relatively stable. For example, the Court’s 1990 decision Employment Division v. Smith had remained good law. Smith held that generally applicable laws that are neutral toward religion—that is, do not target or disfavor religion—receive the lowest level of judicial scrutiny, rational basis review.

Many observers speculated at the time of Masterpiece that Justice Kennedy was looking to carve out a free speech right not to sell wedding cakes to gay couples, to balance the scales after granting major wins to the gay community. The bakery’s argument, however, turned out to be too expansive for the Court to accept. Why? Humans are expressive animals and almost anything they do can be understood as expressive. For this reason, recognizing an expressive right not to serve a customer would not only threaten most civil rights laws but potentially government regulation more broadly. If refusing to abide by a nondiscrimination law is a constitutional right, why not refusing to abide by any other type of law because of what adhering to it might express?

The Court did not take the course urged by the bakery. Instead, it emphasized the “general rule” that religious “objections do not allow business owners and other actors in the economy and in society to deny protected persons equal access to goods and services under a neutral and generally applicable public accommodations law.” In doing so, the Court affirmed established constitutional principles. The bakery won the battle but lost the war.

The law around religious exemptions, however, is swiftly changing. The Supreme Court is now stocked with Justices for whom religious liberty is a central or perhaps even primary concern. The new majority has already begun dramatically remaking religion law in ways that may provide religious exemptions to refuse service or employment to the LGBTQ+ community.

Although the Court’s recent decision in Bostock held that Title VII protects LGBTQ+ people against discrimination as part of its prohibition against discrimination “because … of sex,” the Court also noted that it was “deeply concerned with preserving the promise of the free exercise of religion enshrined in our Constitution.” It observed that the Religious Freedom Restoration Act of 1993 is “a kind of super statute” that “might supersede Title VII’s commands in appropriate cases.” Such cases have not yet reached the Supreme Court, but the Bostock opinion certainly invited them.

The Supreme Court’s highly anticipated decision in Fulton v. City of Philadelphia also addressed these issues. The case presented the question of whether the City of Philadelphia could, consistent with the First Amendment’s protections for religion and speech, refuse to renew its contract with Catholic Social Services to provide foster care placements because the organization refuses, on religious grounds, to place children with gay couples. Although providing foster services is distinct from selling cakes, it is a service that is open to the public—indeed a service that the City contracted to provide the public. Fulton squarely presented the questions of whether Smith should be overturned and whether antidiscrimination rules are unconstitutional if applied to religious dissenters.

To the surprise of many, the Supreme Court jumped the queue to make new law on religious exemptions before it decided Fulton, via what University of Chicago Law School professor William Baude has called its “shadow docket,” decisions it makes by summary order without briefing or argument. By a 5-4 vote in Tandon v. Newsom, the Court earlier this year issued an emergency injunction blocking California’s COVID-19-related restrictions on in-home gatherings as violating the free exercise clause, in what one scholar described as “the most important free exercise decision since 1990.”

The majority reasoned that, because California allowed some secular businesses to bring together more than three families at a time––say, at a grocery store––a three-family limit on in-home gatherings for any purpose, including religious ones, was unconstitutional. The Court adopted what some have called a “most favored nation” view of the free exercise clause, under which otherwise neutral laws are constitutionally suspect if they create any exceptions for “comparable” secular activities. Tandon’s approach, it would turn out, foreshadowed Fulton’s.

The Court in Fulton ostensibly declined to overturn Smith.  Nor did it extend a general constitutional right to discriminate against LGBTQ+ people on religious grounds, as Catholic Social Services had sought and as court watchers believed was the near certain outcome. That is a significant win for LGBTQ+ rights advocates.

Nonetheless, the Court ruled 9-0 in favor of Catholic Social Services, with the majority ruling on seemingly narrow, fact-bound grounds, arguably similar to its decision in Masterpiece Cakeshop.  Why?  Expanding on the logic of Tandon, the Court reasoned that the Philadelphia’s foster care contracts included a “system of individual exemptions” available “at the ‘sole discretion of the Commissioner’” that “invites the government to consider the particular reasons” for an agency’s noncompliance with the rule. The City’s antidiscrimination policies, therefore, did not constitute “generally applicable law.” Accordingly, strict scrutiny, rather than Smith’s rational basis review, applied, and the City failed to justify sufficiently its refusal to grant Catholic Social Services an accommodation not to serve LGBTQ+ couples.

Several points are worth noting here. As University of Pennsylvania professor Cary Coglianese and Penn State Law professor Daniel Walters compellingly argue, “provisions explicitly authorizing exceptions to otherwise seemingly general rules” are in fact “rife throughout the law.” As a result, as they contend, in Fulton “the Supreme Court would seem to have opened the barn door for anyone with religious objections to escape from their duty to obey vast swaths of the law.” Although seemingly narrow, Fulton (along with Tandon) may render Smith largely inapplicable—likely with more far-reaching consequences than LGBTQ+ rights alone. As University of Virginia School of Law professor Douglas Laycock has observed, “if a law with even a few secular exceptions isn’t neutral and generally applicable, then not many laws are.” Indeed, if governmental discretion to enforce a law or any under-inclusiveness constitutes an exception, the domain of Smith becomes vanishingly small.

At the same time, Fulton’s negotiated 15-page majority opinion and nearly 100 pages of concurrences by the Court’s conservatives suggest far more. At least three important implications follow from this collection of opinions.

The first and most important implication may be what all of the opinions declined to address:  the speech claim made by Catholic Social Services. By deciding the case on religious grounds, the Court, as in Masterpiece, avoided the broadest rule it could have adopted, namely that individuals have a right to break laws if they believe their breaking––or following––that law expresses something. Such a holding would deal a fatal blow to regulation at all levels, serving to “render self-government impossible.” But in Fulton, not a single Justice gave the speech argument any air time. Will this Court more broadly shift its focus from speech to religion jurisprudence? Fulton suggests it might.

Second, it is clear there already exist five votes on the Court to expressly overrule Smith—Justices Alito, Barrett, Gorsuch, Kavanaugh, and Thomas—but the justices do not (yet) agree on what should replace it. Of note, the Court has still before it the possibility to hear appeals in both Arlene’s Flowers v. Washington and Ricks v. Idaho Contractors Board, either of which could provide swift vehicles to overrule Smith.

Of the separate opinions in Fulton, Justice Barrett’s concurrence, joined in full by Justice Kavanaugh and in part by Justice Breyer, is no doubt the most important. It disputes the “prevailing assumption” that, if Smith were overruled, strict scrutiny would categorically apply to all neutral and generally applicable laws that burden religion, in favor of a “more nuanced” approach informed by other First Amendment doctrines.

What might that mean? Perhaps a more context-dependent approach, akin to what free speech jurisprudence has long required. Speech jurisprudence has long used different rules and levels of scrutiny depending on the context of expression. Consider, for example, ordinary contracts. Although written in words, contract law generally falls outside of the domain of the Speech Clause, as does the speech of public school teachers dolling out bad grades or of doctors offering advice that constitutes malpractice. Or consider the rules that apply to the speech of a government lawyer, to flag burning, to nutrition labels, or to a law regulating noise levels—all of which receive not only context-bound levels of scrutiny but also legal tests that advance context-dependent constitutional values.

Justice Barrett may attempt to bring religion law to the more complex, and indeed nuanced, world of speech jurisprudence—instead of moving speech law, perhaps, toward the blunt one-size-fits-all rule that the Kennedy Court had increasingly embraced. Barrett’s move, if accepted by the Court, might forge something of a middle path in the conflict between religion and secular laws, and might even benefit speech law in the process.

Third, and finally, a majority of the Court—Chief Justice Roberts and Justices Barrett and Kavanaugh, along with the Court’s liberals, Breyer, Kagan, and Sotomayor—nonetheless appear to agree that the heartland of public accommodations laws are neutral, generally applicable, and constitutional. How does that square with their holding in Fulton? Considering the Philadelphia ordinance, it appears that the majority reasoned de novo—if perhaps in the shadow of constitutional avoidance—that foster services are not covered by Philadelphia’s public accommodations law. Foster care services, the majority reasoned, are not “available to the public” in the sense that the services of ordinary public accommodations, such as restaurants, are publicly available. Foster services, the Court stressed, involve “a customized and selective assessment that bears little resemblance to staying in a hotel, eating at a restaurant, or riding a bus.” That move is important, insofar as it suggests that the Court may in fact uphold against a religion challenge a public accommodations law that does not contain exceptions in contexts such as hotels, restaurants, or transportation. Of course, court watchers will have to wait and see how that question looks to Justices Roberts, Kavanaugh, and Barrett once a concrete case is before them.

If a majority does adhere to the longstanding, general position that public accommodations laws are constitutional, at least in some contexts, what services other than foster care might it exempt from that rule, if any? And if the general position does not hold in the future, will the Court require religious exemptions from public accommodations laws for anyone who would like to refuse to serve or employ LGBTQ+ people on religious grounds in the heartland of economic life?

It would seem that the answer will depend in significant part on what Chief Justice Roberts and Justices Barrett and Kavanaugh view as “open to the public.” Are businesses that make custom wedding flowers or cakes, or dresses or table settings for that matter, open to the public? At this point, I remain relatively optimistic as to the core of public accommodations, if perhaps not as to so-called “personalized” wedding services.

The statutory interpretation path taken by the Court in Fulton might allow the Court to avoid some of the knottiest questions and implications raised by the possibility of a flat exemption for any religious entity that provides public accommodations—so-called faithful public accommodations. This possibility constituted a central focus of oral argument in Fulton.  Specifically, if a faithful public accommodation possessed a right to refuse service to LGBTQ+ people, could another such faithful entity then assert a right not to serve people based on their race, sex, religion, or disability? The federal government’s lawyer attempted to dodge that thorny question, stating that race discrimination might be different, but without explaining why. Indeed, it is hard to see how a constitutional rule granting a right to refuse service to LGBTQ+ people on religious grounds would not create a general right for religious entities to refuse service on the basis of race, disability, family status, religion, or other protected status, especially when an antidiscrimination law treats those categories identically.

By tinkering with the domain of what is truly open or available to the public, the Court may be able to avoid an outcome in which all businesses are able to choose their customers and employees. That would be a happy result for LGBTQ+ advocates. But the Court is nonetheless already on its way to creating enclaves of exclusion and increasing the balkanization of the nation’s social and economic life. “Straight Couples Only” signs can now be posted with full constitutional protection—at least in some contexts.

How far will the newly configured Supreme Court go in its remaking of religion law? And how will it reshape the opportunities of LGBTQ+ people and the openness of institutions that “constitute ordinary civic life in a free society” for all of us? We will have to wait and see.


Amanda Shanor is an assistant professor at the Wharton School of the University of Pennsylvania.

Shanor was part of the ACLU team that represented Charlie Craig and David Mullins, the gay couple denied service by Masterpiece Cakeshop, before the U.S. Supreme Court. She also advised ACLU counsel for the transgender plaintiff and joined an amicus brief of scholars of philosophy on behalf of the employees in the cases consolidated in Bostock.

This essay is part of a 9-part series, entitled LGBTQ+ Rights and Regulation.

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