Three organizations—CompassCare, a pregnancy care center; NIFLA, a network of pro-life centers; and First Bible Baptist Church, a religious institution—challenged the constitutionality of New York Labor Law Section 203-e. This law prohibits employers from discriminating against employees or dependents based on their reproductive health decisions, such as using contraception or having an abortion. The organizations argued that the law violated their First Amendment rights by forcing them to hire and retain individuals whose personal conduct contradicted their religious and pro-life missions. The District Court had dismissed all claims except for a challenge to a 'Notice Provision,' which required employers issuing handbooks to inform employees of their rights under the Act. The District Court had granted summary judgment to the plaintiffs on the Notice Provision, ruling it compelled speech, but dismissed their core associational and religious claims. The Second Circuit's decision in Slattery v. Hochul, issued after the District Court's ruling, established that an employer could have an associational claim if the law forces them to employ individuals acting against their mission, prompting this appeal.
The Court addressed three primary issues. First, regarding expressive association, the Court clarified that the Supreme Court's precedents regarding voluntary membership organizations do not apply neatly to employment relationships due to the contractual nature of employment and the significant power imbalances involved. However, the Court rejected the State's argument that employers have no associational rights at all. Instead, the Court held that an employer must plausibly allege that the law threatens its 'very mission' by forcing it to retain a specific employee in a specific role that would impair the organization's ability to convey its message. The Court vacated the dismissal of these claims to allow the District Court to apply this new standard to the specific facts of each plaintiff. Second, regarding the Notice Provision, the Court determined that the requirement to disclose statutory rights in an employee handbook is a form of commercial speech subject to rational basis review under Zauderer v. Office of Disciplinary Counsel. The Court found the provision reasonably related to the state's interest in preventing deception and not unduly burdensome, as it does not force employers to endorse the law's policy but merely to inform employees of their legal rights. Third, the Court affirmed the dismissal of free speech and free exercise claims. It ruled that hiring and firing decisions are not inherently expressive conduct protected by the First Amendment, and that the Act is a neutral law of general applicability that does not target religious practice, thus satisfying the standard set in Employment Division v. Smith.
The decision remands the case to the District Court to determine whether CompassCare, NIFLA, or First Bible can plausibly allege that the Act forces them to employ individuals who act against their 'very mission' under the standard set in Slattery. The outcome may vary for each plaintiff depending on their specific mission and the roles of the employees in question. The permanent injunction against the Notice Provision is vacated, meaning the law's requirement for employers to include the notice in handbooks remains in effect unless a plaintiff successfully proves on remand that the notice is factually inaccurate or misleading as applied to them. The free speech and free exercise challenges remain dismissed.