Does the Employment Retirement Income Security Act of 1974’s “church plan” exemption apply to a pension plan maintained by an otherwise-qualifying church-affiliated organization, regardless of whether a church initially established the plan?
This consolidated case provides the Supreme Court with the opportunity to resolve a conflict over the application of the “church plan” exemption of the Employee Retirement Income Security Act (“ERISA”). The parties disagree over whether the exemption applies to a pension plan maintained by a church-affiliated entity but not established by a church. Petitioners Advocate Health Care Network et al. (“Advocate”) argue that historical evidence and the statutory text establish that the exemption covers pension plans created by church agencies in addition to plans created by churches themselves. Advocate contends that a contrary interpretation would invite impermissible government interference with and discrimination between religious denominations. Maria Stapleton and fellow Respondents (“Stapleton”) contend that the language and purpose of the “church plan” exemption illustrate that it was not meant to cover a pension plan that was not created by a church. Stapleton also asserts that exempting the pension plans of church-affiliated entities from ERISA violates the Establishment Clause and puts thousands of church-agency employees at risk of losing their retirement benefits.
Questions as Framed for the Court by the Parties
The Employee Retirement Income Security Act of 1974 (“ERISA”) governs employers that offer pensions and other benefits to their employees. “Church plans” are exempt from ERISA’s coverage. 29 U.S.C. §§ 1002(33), 1003(b)(2). For over thirty years, the three federal agencies that administer and enforce ERISA—the Internal Revenue Service, the Department of Labor, and the Pension Benefit Guaranty Corporation—have interpreted the church plan exemption to include pension plans maintained by otherwise qualifying organizations that are associated with or controlled by a church, whether or not a church itself established the plan.
The question presented is whether ERISA’s church plan exemption applies so long as a pension plan is maintained by an otherwise qualifying church-affiliated organization, or whether the exemption applies only if, in addition, a church initially established the plan.
This case is a combination of appeals from United States Courts of Appeals for the Seventh, Ninth, and Third Circuits. The facts from each case are substantially similar.
- Emma Green, The Supreme Court Case That Could Bankrupt Religious Schools and Hospitals, The Atlantic (Dec. 12, 2016).
- Greg Stohr, Religious Hospital Pension Clash Accepted by Supreme Court, Bloomberg Politics (Dec. 2, 2016).
- Mark Walsh, Supreme Court to Weigh Whether Pension Rules Apply to Church Schools, Hospitals, Education Week (Dec. 5, 2016).