Federal Court Updates
Second Circuit: Court Rejects NLRB’s Employer Dress Code Ruling
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APPLIES TO All Employers with Employees in CT, NY, and VT |
EFFECTIVE SEP 2, 2026 |
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Discussion
In Siren Retail Corp. v. NLRB, the Second Circuit Court of Appeals vacated an NLRB decision finding that Starbucks had committed unfair labor practices by enforcing dress code policies that restricted employees from wearing union-logo shirts and certain pins or buttons during working time.
The court took issue with the NLRB’s reliance on the Telsa, Inc. standard, which treated all employer dress code restrictions that limit employees’ display of union insignia as presumptively unlawful, requiring employers to “narrowly tailor” any such restriction to survive scrutiny. The Second Circuit rejected this approach, finding that Tesla placed a “strict-scrutiny-like burden” on employers, even for facially neutral, partial restrictions, without properly weighing the employer’s legitimate interests against employee rights.
Instead, the court stated that dress code policies should be evaluated under a “balanced” framework, instructing the NLRB to apply a three-factor test considering: (1) the extent of intrusion on employee rights, specifically, whether the employer imposed a full or only partial restriction on union insignia; (2) whether the policy is facially neutral, nondiscriminatory, and consistently enforced; and (3) the context and circumstances underlying the restriction.
Notably, the court did not apply the new three-factor framework to the facts of this case (the matter was sent back to the NLRB for reconsideration under the revised standard), so there is not yet a clear indication of how it will be applied in practice. That said, the decision reflects a meaningful shift toward a more workable standard for employers, one that gives genuine weight to legitimate business interests in maintaining consistent workplace appearance policies, provided those policies are neutral and consistently enforced.
Action Items
- Review existing dress code and appearance policies for compliance.
- Consult with legal counsel on specific business justifications for employee attire restrictions or mandates.
Seventh Circuit: Court Evaluates Undue Hardship in Religious Accommodation Case
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APPLIES TO All Employers with Employees in IL, IN, and WI |
EFFECTIVE SEP 28, 2026 |
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Discussion
In Mason v. Cook County, the Seventh Circuit Court of Appeals affirmed the dismissal of a Title VII religious discrimination claim brought by a hospital pharmacist who was terminated after refusing to comply with a mandatory COVID-19 vaccination policy.
In this case, the employee, a pharmacist at a large county hospital, requested a religious exemption from the COVID-19 vaccine mandate based on her Christian beliefs. The county denied the request, determining that exemptions could only be granted to employees whose duties could be performed fully remotely, citing CDC guidance that vaccination was the most effective way to reduce transmission and protect medically vulnerable patients. Because the employee’s role required regular in-person contact with coworkers, patients, and a dedicated COVID-19 treatment floor, no remote option was available. She was terminated after declining to obtain the vaccine.
The court’s analysis centered on the undue hardship standard established by the U.S. Supreme Court in Groff v. DeJoy, which held that an employer faces undue hardship if granting an accommodation would result in substantial increased costs in relation to the conduct of its particular business. The Seventh Circuit emphasized that this analysis cannot consider the accommodation in isolation. Instead, it must account for the employer’s overall operations and the practical impact of the accommodation in context.
Applying that framework, the court found that the employer sufficiently established an undue hardship in this case. The county presented declarations from HR, EEO, and infection control officials documenting that masking and social distancing alone did not adequately address patient and employee safety risks, and that the employee’s specific role (e.g., working in a room with 60 coworkers, counseling patients, and delivering medications to a COVID-19 floor) made an individual exemption particularly problematic. The court also rejected the employee’s disparate treatment claim, finding that a comparison employee she identified was not similarly situated because the two held different jobs, in different locations, with different supervisors, and the comparator employee ultimately obtained the vaccine.
While the COVID-19 context makes this case somewhat specific on its facts, the court’s undue hardship analysis under Groff v. DeJoy reinforces that an undue hardship analysis must be grounded in specific facts (e.g., demands of the role, work environment, proximity to coworkers, and the feasibility of alternative arrangements) and supported by concrete evidence. Employers should maintain contemporaneous documentation of employee accommodation requests, the entire interactive process, and any results, including denials. Because the undue hardship analysis may vary based on jurisdiction, employers are also encouraged to consult with legal counsel on any denial that may be based on an asserted undue hardship.
Action Items
- Evaluate religious accommodation requests individually, considering the employee’s specific role, work environment, and the practical impact of the proposed accommodation on operations.
- Maintain documentation throughout the entire accommodation process.
- Consult with legal counsel when denying an accommodation request, particularly when based on an undue hardship analysis.
- Have appropriate personnel trained on religious accommodation requirements.
Ninth Circuit: Personal Health Preferences Are Not Religious Beliefs
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APPLIES TO As Indicated |
EFFECTIVE AUG 13, 2026 |
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Discussion
In Ledezma v. Optum Services, Inc., the Ninth Circuit Court of Appeals affirmed, in an unpublished opinion, summary judgment for the employer on a religious accommodation claim brought exclusively under California’s Fair Employment and Housing Act (FEHA). Because the decision is unpublished, it does not carry the weight of binding legal precedent. It also does not address Title VII, meaning employers outside California should not rely on this decision when evaluating their own accommodation obligations.
The case arose after the employer terminated Ms. Ledezma for declining to comply with its mandatory COVID-19 vaccination policy. She requested a religious exemption, citing her Catholic faith, quoting scripture, and arguing that her body was a “temple of the Holy Spirit” that she was religiously required to keep free of harmful substances. The employer denied the request and terminated her, and she subsequently sued under FEHA.
To succeed on a religious discrimination claim under FEHA, an employee must generally show three things: (1) a sincere religious belief that conflicts with a job requirement, (2) notice of that belief and conflict to the employer, and (3) an adverse employment consequence for failing to comply. The central question in Ledezma was whether the employee’s objection qualified as a religious belief at all, not whether she was genuinely sincere in holding it.
Relying on its 2025 decision in Detwiler v. Mid-Columbia Medical Center, the Ninth Circuit concluded that Ledezma’s objection was rooted in her personal views about vaccine safety, her longstanding preference for holistic medicine, and her general avoidance of vaccines, all of which represented secular concerns that did not become religious simply because she expressed them in religious terms. The court rejected her argument that grounding an objection in specific Biblical passages made it meaningfully more religious than a general spiritual objection. What matters, the court explained, is not how an employee arrived at their conviction (e.g., whether through prayer, scripture, or spiritual experience), but what the conviction actually is. The court ultimately concluded that where the specific objection ultimately rests on a personal health judgment, it remains a secular preference as a matter of law regardless of the religious framing applied to it.
One judge on the three-judge panel would have ruled the other way, finding that Ledezma’s beliefs (including her view that the COVID-19 vaccine would alter what God made) were plausibly religious in nature and that the case should have gone to a jury rather than being dismissed. That view did not prevail, but it reflects the genuine difficulty of these cases and is a reminder that courts are not uniform in how they draw the line between religious belief and personal preference.
This decision, although unpublished, reinforces that the nature of the belief, not its vocabulary, is the operative inquiry under FEHA. That said, the decision is not a green light for accommodation denials. Employers should conduct an individualized review of all religious accommodation requests, paying particular attention to what the employee is actually objecting to, and should maintain clear documentation throughout the accommodation process.
Action Items
- Review religious accommodation procedures for compliance with applicable federal and state requirements.
- Maintain documentation throughout the interactive accommodation process, including, but not limited to, the specific basis for any denial.
- Have appropriate personnel trained on religious accommodation requirements.
- Consult with legal counsel when evaluating specific accommodation requests.
Seventh Circuit: Key Reminders on Title VII Claims
On September 10, 2026, in Ismail v. Steiner, the Seventh Circuit Court of Appeals affirmed summary judgment for the U.S. Postal Service on race and national origin discrimination, retaliation, and hostile work environment claims brought by a mail carrier who was escorted from the workroom floor by police and placed on a two-day unpaid suspension following a heated altercation with his supervisor. The court found the employee failed to identify a valid comparator because he lacked personal knowledge of the alleged similar incident involving a coworker and did not know whether that employee had been disciplined. On his retaliation claim, the court found a three-year gap between the employee’s prior EEO complaint and the adverse action to be too attenuated to establish causation. Regarding the hostile work environment claim, the court found no evidence that the supervisor’s conduct, however disrespectful, was connected to the employee’s race or national origin. While the case represents a straight forward application of the existing Title VII standards, it serves a s reminder that each claim requires evidence specifically tying an adverse action to a protected characteristic, not just evidence of a difficult working relationship.
Seventh Circuit: Employers Get Full Credit for Prior Pension Fund Withdrawals
On September 17, 2026, the Seventh Circuit Court of Appeals issued an employer-favorable decision in Consumers Concrete Corp. v. Central States Southeast and Southwest Areas Pension Fund, holding that when an employer incurs partial withdrawal liability from a multiemployer pension plan and later triggers a complete withdrawal, the credit from the prior partial withdrawal must be applied against the employer’s final withdrawal liability after all statutory adjustments (including the Multiemployer Pension Plan Amendments Act of 1980 (MPPAA)’s 20-year payment cap) rather than earlier in the calculation process. Under the Employment Retirement Income Security Act of 1974 (ERISA), employers that withdraw from an underfunded multiemployer pension plan must pay their share of the plan’s unfunded vested benefits, and prior partial withdrawal credits exist to prevent employers from being charged twice for the same unfunded benefits. The Seventh Circuit’s approach may substantially reduce, and in some cases potentially eliminate, an employer’s final withdrawal liability. The court expressly disagreed with contrary decisions from the Ninth and Eleventh Circuits, creating a circuit split on an issue affecting employers participating in multiemployer pension plans nationwide. Employers currently participating in multiemployer plans, facing a withdrawal liability assessment, or considering restructurings or facility closures that could trigger a withdrawal should consult with ERISA counsel to assess the impact of this decision on their specific circumstances, including any venue considerations given the existing circuit split.
Disclaimer: This document is designed to provide general information and guidance concerning employment-related issues. It is presented with the understanding that ManagEase is not engaged in rendering any legal opinions. If a legal opinion is needed, please contact the services of your own legal adviser. © 2026 ManagEase