Hobby Lobby’s Labor Costs

IUD separation anxiety. 2006.

You’ve probably heard the news: the U.S. Supreme Court has found in favor of Oklahoma-based retailer Hobby Lobby’s objection to providing its employees with birth control under Obamacare. The case’s breadth has been completely misinterpreted, though. Contrary to the mainstream opinion, it is not about “religious freedom.” It is true that Hobby Lobby’s managers and executives probably do have some private opposition to contraception (like a lot of people.) However, if we present this debate as being solely a question of religious freedom, then we lose track of what is really going on. Hobby Lobby, in alliance with the National Right to Work Legal Foundation, has invented a new way for employers to lower their labor costs. They are shielding it in a debate about religious freedom that is actually a paper tiger.

Companies like Hobby Lobby have an obvious interest in keeping labor costs low. They extract a profit from the products they sell after paying off the cost of bringing them to market. First though, they have to deduct the price of labor: people’s wages. If their employees’ total labor costs are low, then Hobby Lobby makes more of a profit. It’s simple. The easiest way to do this is to find creative ways to lower them, rather than garnishing pay outright, which would cause a backlash. After Obamacare, one of the labor costs that companies like Hobby Lobby had to take into account was health care.

Following a failed Supreme Court initiative to throw out the Affordable Care Act altogether last December, conservatives changed their approach. Instead, they sought to restrict specific parts of Obamacare in order to minimize the new labor cost of health care as much as possible. Every dollar saved here is another dollar of profit. Contraception was one of those costs. The National Right to Work Legal Foundation phrased their argument carefully, to be about freedom of religion, because it knows that the Supreme Court currently has a slim majority of originalists, textualists, and strict constructionists. It also knows that the Supreme Court is institutionally limited from discussing the marketplace trends really at play, especially since conservatives have induced a fear of “activist courts.” The result was a ruling, and debate, that dealt with the religious values of a corporate body, rather than its antagonistic relationship with its workers.

The fact is that Obamacare’s stipulations about women’s health ate into Hobby Lobby’s profit margins, as well as those of large businesses throughout the United States. Contrary to popular belief, small businesses usually overlook costs like this, because managers are more likely to know their employees personally. Hobby Lobby, on the other hand? It saw women’s health as one set of numbers, and profits as another set of numbers, and pursued the latter at the expense of the former. This is the type of thinking that the National Right to Work Legal Foundation actually represents, while claiming to stand for “Christian values.” It’s not about religious liberty. It’s about using religion as a half-baked excuse to avoid giving people money. The result has been a Supreme Court ruling that forces employees to be at the whim of whether or not their employers will decide that public health is an expensive violation of their religion. Beyond money, that also extends domination and control. Problems like this are going to continue until health care is taken outside of the marketplace entirely.


Lead photograph courtesy of Liz Henry. Published under a Creative Commons License.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.