California Supreme Court to Determine Whether ‘Ministerial Exception’ Bars Wage-and-Hour Claims by Religious Workers

On November 21, 2025, the California Court of Appeal, First Appellate District, Division Five, issued a published decision in Lorenzo v. San Francisco Zen Center addressing the scope of the ministerial exception under the First Amendment in the context of wage-and-hour claims brought by a former staff member against the San Francisco Zen Center, a Zen Buddhist training center. The court reversed summary judgment in favor of the defendants, holding that the ministerial exception does not categorically bar wage claims absent evidence that such claims implicate ecclesiastical concerns. The decision also clarified statutory requirements for posting undertakings in appeals from Labor Commissioner orders. On February 12, 2025, the Supreme Court of California agreed to hear Lorenzo and examine the ministerial exception in the context of the case.

On March 2, 2026, the California Court of Appeal, First Appellate District, Division Two, issued a published opinion, Ehrenkranz v. San Francisco Zen Center (A171652), involving the identical issues and the same employer.

The Ehrenkranz court came to the same conclusion as the Lorenzo court regarding the application of the ministerial exception, but, notably, reached a different result from Lorenzo on the issue of whether the individual defendants were required to post an undertaking to appeal the Labor Commissioner’s award. The Ehrenkranz court concluded, following a lengthy analysis, that the statute requiring the undertaking did not apply to the individual defendants. That holding itself was significant.

It is expected that the Ehrenkranz defendants will also seek review by the Supreme Court of California—a petition that will be granted based upon the review previously granted in Lorenzo. This article focuses on Lorenzo.

Quick Hits

• On February 12, 2026, the Supreme Court of California agreed to hear a wage-and-hour case involving the ministerial exception under the First Amendment.
• In November 2025, the California Court of Appeal held that the ministerial exception does not bar wage-and-hour claims against religious institutions unless adjudication of those claims would require judicial inquiry into matters of faith, doctrine, or internal church governance.
• The court reversed summary judgment for the defendants, finding no evidence that the plaintiff’s wage claims raised ecclesiastical concerns.
• The court further held that individual defendants found liable as “employers” under Labor Code section 558.1 must each post an undertaking to perfect their appeals from California Labor Commissioner orders; failure to do so deprives the court of jurisdiction over their appeals.

Background on Lorenzo v. San Francisco Zen Center

Annette Lorenzo, a former participant and staff member in a residential Zen Buddhist training program, alleged wage-and-hour violations against the San Francisco Zen Center and two of its former leaders. The organization operated multiple training centers and generated income through commercial activities, including guest accommodations and event rentals. Lorenzo’s duties included cleaning, guest services, kitchen work, and other tasks supporting both religious practice and commercial operations.

After the Labor Commissioner found all defendants liable for unpaid wages, overtime, and related penalties, the defendants appealed. The organization posted an undertaking for the full award amount, but the individual defendants did not. The trial court denied Lorenzo’s motion to dismiss the individual appeals and subsequently granted summary judgment for all defendants, finding the ministerial exception barred the claims.

Key Holdings of the Court of Appeal in Lorenzo v. San Francisco Zen Center

Ministerial Exception Limited to Ecclesiastical Concerns. The appellate court clarified that the ministerial exception, as recognized by the Supreme Court of the United States in Hosanna-Tabor Evangelical Lutheran Church and Our Lady of Guadalupe School v. Morrissey-Berru, is grounded in the church autonomy doctrine and protects religious organizations from judicial interference in decisions regarding the selection, supervision, and removal of ministers. The exception, however, does not extend to all employment claims by ministers. Wage-and-hour claims that do not require courts to resolve religious controversies or intrude upon matters of faith and doctrine are not barred by the exception.

The court distinguished wage claims from employment discrimination and wrongful termination claims, noting that minimum wage and overtime disputes do not inherently implicate ecclesiastical concerns. The court rejected the broad interpretation of the ministerial exception adopted by certain federal appellate decisions, emphasizing that religious organizations are not generally immune from secular laws absent a showing that compliance would burden religious exercise or entangle courts in religious matters.

Church Autonomy Doctrine. The court further explained that the church autonomy doctrine may bar claims only where the alleged misconduct is rooted in religious belief. In this case, neither party argued that the wage claims required resolution of religious doctrine or practice, and the record contained no evidence that compensation decisions implicated ecclesiastical concerns.

Statutory Requirements for Appeals From Labor Commissioner Orders. The court held that individuals found liable as “employers” under California Labor Code section 558.1 must each post an undertaking to appeal a Labor Commissioner order. The undertaking posted by the organization did not cover the individual defendants, and no joint and several bond was provided. As a result, the trial court lacked jurisdiction over the individual appeals, and the judgments in their favor were reversed on this independent ground.

Key Takeaways

• The ministerial exception does not categorically bar wage-and-hour claims against religious institutions; it applies only where adjudication would intrude upon matters of faith, doctrine, or internal governance.
• Religious organizations must demonstrate that application of wage-and-hour laws would violate the First Amendment’s Free Exercise or Establishment Clauses to invoke constitutional protection.
• Individuals found liable as “employers” under Labor Code section 558.1 must independently satisfy statutory undertaking requirements to perfect appeals from Labor Commissioner orders.
• The decision underscores the importance of distinguishing between employment claims that implicate ecclesiastical concerns and those that do not and clarifies procedural requirements for appeals in wage-and-hour disputes involving religious entities.

Employers and individuals involved in religious organizations may want to carefully assess whether employment claims implicate protected religious autonomy and ensure compliance with statutory requirements when appealing California Labor Commissioner decisions.

Ogletree Deakins’ California offices and Wage and Hour Practice Group will continue to monitor developments and will provide updates on the California and Wage and Hour blogs as additional information becomes available.

Follow and Subscribe
LinkedIn | Instagram | Webinars | Podcasts