The Court of Appeals of Indiana held that a pastor could not sue the church that formerly employed him for wages and vacation pay, concluding that the lawsuit would require the court to inquire into intrachurch matters, which the court reasoned is forbidden by the First Amendment. In Steven Matthies v. The First Presbyterian Church of Greensburg Indiana, Inc., No. 16A01-1409-PL-380 (Ind. Ct. App. Apr. 8, 2015), Pastor Steven Matthies sought to enforce part of a three-year contract that he argued entitled him to salary and vacation pay after his employment ended.

When First Presbyterian, a member congregation of the Presbyterian Church (USA) in Greensburg, Indiana, called Pastor Matthies, the contract included salary, housing, and five weeks’ vacation. That contract was to cover a three-year period, but the relationship between congregation and pastor deteriorated. The congregation alleged the pastor “neglected his pastoral responsibilities” and “abandoned” his pastoral duties without informing congregation leaders or obtaining consent for vacation time. The friction escalated to the point that the Presbytery of Whitewater Valley’s (PCUSA’s area adjudicatory) Committee on Ministry intervened. The committee eventually ended the pastor’s call to First Presbyterian, offering to negotiate a fair and equitable severance package, which Pastor Matthies declined.

Instead, Matthies filed a complaint alleging violations of Indiana Wage Claims Statute (Ind. Code §§ 22-2-9-.1 to -8) and Indiana common law. First Presbyterian responded with a breach-of-contract defense, arguing it was no longer obligated to pay Matthies. It followed up with a motion for summary judgment that included an argument invoking the First Amendment’s preclusion against courts’ interpreting and applying “religious doctrine or ecclesiastical law.” The trial court rule in the congregation’s favor and certified its decision as final and appealable.

The Court of Appeals noted that the First Amendment does not categorically close the courtroom doors to religious organizations. Namely, where applying neutral principles of law to a church defendant’s actions that “could not have been religiously motivated.” Matthies appealed to this principle and asserted that the court could decide his claims by applying neutral principles of contract law.

The court rejected this argument because the core issue was whether First Presbyterian was justified in terminating Pastor Matthies, a determination that “necessarily would have required inquiry into the reason for termination.” To address the competing claims that Matthies abandoned his duties and that First Presbyterian failed to pay him “would require a court to inquire into the religious doctrine of the Presbyterian Church and its polity.” That inquiry would include examining pastoral duties and determining whether Matthies fulfilled them.

The opinion does not discuss any potential application of the Indiana Constitution apart from the First Amendment.

Judge Terry A. Crone wrote separately to dissent from the majority opinion, written by soon-retiring Judge Ezra H. Friedlander and joined by Judge James S. Kirsch, only as it prevented Matthies’s claim for unpaid vacation wages under the Wage Claim Statute. Crone believed “that claim could be viable regardless of the basis for his termination” because it only required a court to decide whether any vacation time had accrued at the time of the termination. Crone also pointed out that First Presbyterian argued that the Indiana Minimum Wage Law’s ministerial exception (Ind. Code § 22-2-2-3(f)) should be read into the Wage Claims Statute and that the congregation was not Matthies’s employer under the latter. He rejected both without a detailed explanation, and the majority’s conclusions did not require it to address these.

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