This Court has long recognized the right of religious organizations to control their internal affairs. Watson v. Jones, 80 U.S. 679, 728–29 (1871). This right includes the freedom of religious organizations “to decide for themselves, free from state interference, matters of church government as well as those of faith and doctrine.” Kedroff v. St. Nicholas Cathedral, 344 U.S. 94, 116 (1952). Most importantly, it includes the right of religious organizations to select their own religious leaders. Ibid.; Serbian E. Orthodox Diocese v. Milivojevich, 426 U.S. 696, 724–25 (1976); Gonzalez v. Roman Catholic Archbishop, 280 U.S. 1, 16 (1929).
Based on this right, twelve federal circuits have recognized the “ministerial exception.” (The Federal Circuit has no jurisdiction over cases that could present the issue.) The ministerial exception bars lawsuits that interfere in the relationship between a religious organization and employees who perform religious functions — most obviously, lawsuits seeking to compel a religious organization to reinstate such an employee or seeking to impose monetary liability for the selection of such employees. As the first court adopting the ministerial exception explained: “The relationship between an organized church and its ministers is its lifeblood”; allowing the state to interfere in that relationship — effectively allowing judges and juries to pick ministers — would produce “the very opposite of that separation of church and State contemplated by the First Amendment.” McClure v. Salvation Army, 460 F.2d 553, 558, 560 (5th Cir. 1972).
Based on this principle, every circuit has agreed that the ministerial exception bars most lawsuits between a religious organization and its leaders. Every circuit has also agreed that the ministerial exception extends beyond formally designated “ministers” to include other employees who play an important religious role in the organization. And all eleven circuits to consider the question have agreed that the ministerial exception survives this Court’s decision in Employment Division v. Smith, which reaffirmed the cases underlying the ministerial exception — namely, cases forbidding the government from “lend[ing] its power to one or the other side in controversies over religious authority or dogma.” 494 U.S. 872, 877 (1990).
But the agreement ends there. Federal circuits are in sharp and acknowledged conflict over what legal standard controls the boundaries of the ministerial exception, and specifically over the “primary duties” test used by the Sixth Circuit here. The conflict has produced directly conflicting results in factually indistinguishable cases, and is widely recognized and firmly entrenched.
UPDATE: Prof. Rick Garnett (Mirror of Justice) has more.