Indiana Religious Freedom Law Confounds Employers

Author: David B. Weisenfeld, XpertHR Legal Editor

March 30, 2015

Indiana Governor Mike Pence has signed a controversial law that prevents the government from infringing on a business's or individual's religious liberty in the Hoosier State. The Indiana Religious Freedom Restoration Act (RFRA) allows any for-profit business to assert a free exercise of religion claim. This language bears some similarity to the Supreme Court's 2014 Hobby Lobby ruling, which gave corporate employers a religious veto over their employees' rights to contraceptive coverage under the Affordable Care Act.

But opponents claim this law goes further and that it sanctions discrimination against the LGBT community. Some speculate that the measure would allow businesses to deny service to gay and lesbian customers. Employers such as Yelp, Angie's List and Salesforce.com have already said they will cancel expansion plans or pull back on investments into Indiana as a result of the new law. Meanwhile, Apple CEO Tim Cook criticized the law, saying "it will have a negative impact on the economy and job growth." Cook had announced publicly last year that he is gay. In addition, the mayors of San Francisco and Seattle have banned all work-related, city-funded trips to Indiana in light of the new law.

About a dozen Indiana cities, including Indianapolis, reportedly have nondiscrimination ordinances that protect gays and lesbians in employment, public accommodation and other areas. But much of the state does not have such local protections in place.

Governor Pence has defended the Indiana RFRA, saying it is not about discrimination but about protecting against government overreach. However, Pence also has said he will not consider adding sexual orientation as a protected class in Indiana's civil rights laws.

With the NCAA men's basketball Final Four scheduled to take place in Indianapolis this weekend, some have called for the event to be moved to another state. Arizona passed a similar bill last year, but then-Governor Jan Brewer vetoed it amidst threats that the state could lose the Super Bowl if she did not.