In a landmark religious liberty decision, the U.S. Supreme Court ruled unanimously on June 5 that Wisconsin violated the First Amendment when it denied a Catholic Charities chapter an unemployment tax exemption. This victory reaffirms long-standing constitutional protections for faith-based organizations and sends a clear message: religious groups cannot be penalized for living out their beliefs through charitable service.
The reason this matters so deeply is because it touches on the heart of Catholic identity—our mission to serve all people, not just fellow believers, with the compassion of Christ. For decades, Catholic Charities Bureau in Wisconsin has quietly done just that, offering job training, coaching, and support for the disabled, regardless of religion. But the state claimed that because their programs didn’t include religious instruction or require Catholic affiliation, their work was “primarily secular” and therefore not eligible for exemption under state law.
The Court disagreed. Writing for the majority, Justice Sonia Sotomayor stated, “There may be hard calls to make in policing that rule, but this is not one.” She continued, “When the government distinguishes among religions based on theological differences in their provision of services, it imposes a denominational preference that must satisfy the highest level of judicial scrutiny” (according to Fox News, June 5, 2025).
The justices found that Wisconsin had granted exemptions to other faith-based groups but not to Catholic Charities, based on how “religious” their services appeared on the surface. But, as Eric Rassbach, attorney with the Becket Fund for Religious Liberty, pointed out, “It was always absurd to claim that Catholic Charities wasn’t religious because it helps everyone, no matter their religion” (according to USA Today, June 5, 2025).
In fact, the Court highlighted the danger of such government interference: by requiring the state to analyze the religious content of services, it would create the very kind of “excessive entanglement” the First Amendment is designed to prevent. This is particularly relevant for the Catholic Church, whose charitable mission is based not on proselytizing, but on the Gospel’s call to serve the least among us.
Catholic Charities noted that it prefers to protect employees through the Church’s own unemployment program, which matches state benefits and may even provide faster relief. However, critics argued that religious unemployment systems are not backed by government guarantees and can leave workers without access to federal emergency funds like those seen during the COVID-19 pandemic.
Nonetheless, the unanimous ruling reversed the Wisconsin Supreme Court’s decision and remanded the case, Catholic Charities Bureau v. Wisconsin Labor and Industry Review Commission, for further proceedings. This outcome has broader implications beyond Wisconsin. As Fox News noted, “The decision could clear the way for more states to broaden their tax-exempt status for religious organizations.”
For Catholics, the ruling is not just a legal win—it’s a moral vindication. It affirms that our faith cannot be divided from our works of mercy, and that serving the public good through charity is not a secular act, but a sacred one.
This ruling is a significant affirmation of religious liberty and the essential work of faith-based organizations. It’s heartening to see the Supreme Court recognize the intrinsic value of Catholic Charities’ mission, which serves everyone without discrimination. The Court’s decision highlights the importance of protecting religious groups from undue government interference, ensuring they can continue their charitable work freely. However, I wonder how this ruling will impact other faith-based organizations with similar missions moving forward? While the legal victory is commendable, critics raise valid concerns about the lack of government-backed protections in private religious unemployment systems. It’s crucial to balance religious freedom with the need to safeguard workers’ rights, especially in times of crisis like the COVID-19 pandemic. Do you think there’s a way to address these concerns without compromising the principles upheld in this decision?