Whether applying § 702's religious-employment exemption to the secular nonprofit activities of a religious organization violates the Establishment Clause.
Holding
No. As applied to the nonprofit Deseret Gymnasium, § 702 is a permissible accommodation of religion and does not violate the Establishment Clause.
Reasoning
The Court applied the Lemon framework and held that Congress had a valid secular purpose: reducing significant governmental interference with religious organizations' ability to define and carry out their missions. Even if the Free Exercise Clause did not compel an exemption this broad, Congress could reasonably conclude that forcing churches to predict which activities a court would label “religious” would burden religious exercise and invite courts to misunderstand a church's beliefs and mission.
The exemption's principal effect was not governmental advancement of religion in the constitutionally forbidden sense. Although religious organizations may be better able to pursue their purposes because of § 702, the Establishment Clause does not invalidate every law that benefits religion. The relevant question is whether the government itself has sponsored, financially supported, or become actively involved in religious activity. On this record, any religious advancement through the gymnasium was attributable to the Church's own operation of the facility, not to government action.
The fact that § 702 gives a benefit specifically to religious organizations did not make it invalid. The Court rejected a rule requiring every religious accommodation to be bundled with comparable benefits for secular entities. When the government acts to lift a regulatory burden on religious exercise for a proper purpose, special treatment for religion can be a permissible accommodation rather than an establishment.
Section 702 also reduced, rather than created, excessive church-state entanglement. A narrower exemption would require courts to conduct intrusive, uncertain inquiries into whether particular activities and jobs are sufficiently religious. The contrast between the District Court's treatment of the Church's charitable Deseret Industries program and its gymnasium illustrated how fine and difficult that line could be. A categorical exemption for the religious organization's nonprofit activities avoided those inquiries.