UI Court decision summary -- Challenge Center v. LIRC et al. (Wis. Cir. Ct., Douglas Co., November 18, 2015) - ET 483.10  PC 757  Applying a “de novo” standard of review, court holds that Challenge Center, a subdivision of the Catholic Church’s Catholic Charities Bureau (CCB), was “an organization operated primarily for religious purposes” within the meaning of Wis. Stat. § 108.02(15)(h)2.

Wisconsin Labor and Industry Review Commission --
Summary of Wisconsin Court Decision relating to Unemployment Insurance


Subject: Challenge Center v. LIRC et al., No. 14-CV-384 (Wis. Cir. Ct., Douglas Co., November 18, 2015)

Digest Codes: ET 483.10 PC 757

Challenge Center (CC) is a 501(c)(3) organization providing services to persons with developmental disabilities. It is a subdivision of Catholic Charities Bureau (CCB), which is the non-profit social service branch of the Catholic Church. The issue in this case was whether CC was “an organization operated primarily for religious purposes and operated, supervised, controlled or principally supported by a church or convention or association of churches” within the meaning of Wis. Stat. § 108.02(15)(h)2., such that the services of persons employed by CC would be excluded from the definition of “Employment” for Unemployment Insurance purposes. The focus in this case was on the question of whether CC was “operated primarily for religious purposes.” In several cases (one tax case and two benefit cases), LIRC held that CC was not “operated primarily for religious purposes.” CC appealed to Circuit Court.

HELD: LIRC’s decisions are reversed. With respect to the standard of review, the court concludes that de novo review is appropriate. The court is not convinced that LIRC has sufficiently demonstrated any specialized knowledge or expertise relevant to the “religious purpose” question such that the court should accord its decisions great or due weight deference. Of its experience of five cases, only three dealt with the “religious purpose” test, the facts in those cases did not resemble the facts in the case at bar, and the results have been inconsistent. With respect to the merits, the court notes that CC is not autonomous from the Bishop of Superior (or from CCB), that CCB is controlled by the Church, that CC is subject to the oversight and discretion of the Bishop, and that all of CC’s services are provided at the direction and oversight of the Bishop pursuant to the Ten Principles of Catholic Social Teaching, which spring directly out of the Catechism of the Church and the Compendium of the Social Doctrine of the Church. Based on these and other circumstances surrounding the operation of CC and the role of the Church in it, the court finds that CC has established that it is an organization operated primarily for religious purposes. 


Please note that this is a summary prepared by staff of the commission, not a verbatim reproduction of the court decision.

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