This bill is not about discrimination, and if I thought it legalized discrimination in any way I would have vetoed it.
Governor Pence is misinformed. This law is clearly designed to foster and encourage acts of private discrimination by businesses and employers on the basis of sexual orientation.
What is the evidence that Indiana S.B. 101 is intended to protect and encourage discrimination against gays and lesbians? First of all is its timing.
1. The Timing of Indiana S.B. 101 and Its Treatment of Local Non-Discrimination Ordinances
The federal RFRA and laws of many states were adopted more than 20 years ago before same-sex marriage or even gay rights in general was an issue in public life. Congress adopted the original RFRA in reaction to the decision of the United States Supreme Court in Employment Division v. Smith (1990). That case involved individuals who had been fired from government posts because they had ingested peyote as part of a sacrament of the Native American Church, The federal RFRA and the state laws modeled after it were intended to restore the right of individuals and religious organizations to make decisions about their own conduct, their family lives, and the internal governance of their own religious bodies.
The Indiana legislature adopted this law in 2015 because of legal action taken by two other authorities in the State of Indiana: municipalities and the federal courts. In recent years three Indiana counties and ten Indiana cities (including Indianapolis) adopted laws prohibiting discrimination on the basis of sexual orientation. For example, Indianapolis Ordinance 581-102 disqualifies businesses from being eligible for public contracts if they discriminate on the basis of race, sex, sexual orientation, gender identity, religion, color, national origin, ancestry, race, disability, and United States military service veteran status. Then on September 4, 2014, the Seventh Circuit Court of Appeals, in the case of Baskin v. Bogan, written by Judge Richard Posner, struck down Indiana's laws prohibiting same-sex marriage. As a result, private businesses and employers in Indiana faced legal liability if they refused to treat gay and lesbian couples equally. Indiana S.B. 101 was adopted to protect business owners from these local ordinances, which would have required them to serve gay and lesbian customers who were getting married and would have required them to extend equal employment benefits to gay and lesbian employees who were already married. As evidence that these local ordinances were on the mind of the framers of the legislation, Section 2 of Indiana S.B. 101 expressly provides that only the state legislature may "exempt" laws or ordinances from the operation of the state Religious Freedom Restoration Act.
2. The Law Expressly Protects the Religious Beliefs of Employers and Expressly Excludes the Religious Beliefs of Employees
Other evidence that Indiana S.B. 101 is an "anti-gay" employment discrimination law is the fact that it expressly protects employers but not employees! Section 7 of the law is very careful to state that it applies not only to individuals but also to:
a partnership, a limited liability company, a corporation, a company, a firm, a society, a joint-stock company, an unincorporated association, or another entity ... regardless of whether the entity is organized and operated for profit or non-profit purposes.
However, Section 11 of the law makes it equally clear that it does not apply in favor of employees against employers:
This Chapter is not intended to, and shall not be construed or interpreted to, create a claim or private cause of action against any private employer by any applicant, employee, or former employee.
How is one to understand this provision? This law expressly states that employers, including corporations, have rights to "religious freedom" that must be "restored," but that employees do not have equal rights to religious freedom. It is bad enough that this law seeks to permit people to discriminate against others in accordance with their religious beliefs. It is practically inconceivable that it elevates the religious beliefs of one economic class over those of another.
3. The Monetary Reward for Acts of Private Discrimination
Section 10(a) of Indiana S.B. 101 gives parties a "defense" against any law that unduly infringes on their religious beliefs. In this the Indiana Religious Freedom Restoration Act is the same as other RFRAs. However, Section 10(b) of the Indiana statute goes much further. It provides that employers or others whose "religious freedom" was infringed are entitled to "compensatory damages," "costs," and "attorney fees" in the event that they are successful in defending against a law that invaded their "religious freedom."
This type of provision is unusual in American law. First of all, while the losing side in an American lawsuit is normally assessed "costs," it is unusual for the winning side to be awarded "attorney fees." And it is unprecedented for the winning side to be entitled to "compensatory damages."
These provisions of S.B. 101 create a serious problem under the Equal Protection Clause of the Constitution. The Equal Protection Clause prohibits the states from discriminating against its citizens, but it does not require the states to punish acts of private discrimination. The Supreme Court has ruled many times that the states do not have to enact civil rights laws prohibiting private acts of discrimination on the basis or race, gender, religion, disability, sexual orientation, or any other characteristic. The states may, if they choose, stand on the sidelines and remain neutral with respect to the discriminatory actions of their private citizens towards each other.
However, the Supreme Court has also ruled on many occasions that the states are not permitted to enact laws that encourage acts of private discrimination. In my opinion the provisions of Indiana S.B. 101 cross the line from "neutrality" to "encouragement." It is one thing to let people discriminate against each other because their religious beliefs inform them that other people are inferior or not deserving of respect. It is quite another to reward them for acting in such a discriminatory manner.
Indiana S.B. 101 was clearly adopted in response to the fact that gay and lesbian couples in Indiana now have the right to marry, and it was designed to overrule county and municipal ordinances that would have prohibited private acts of discrimination against these couples. That is its obvious purpose and effect.
It is entirely accurate to describe the law as an "anti-gay" statute.