The Leftist Wisconsin Supreme Court just handed Catholic Charities a massive win and dealt a blow to Wisconsin Attorney General Josh Kaul and his reelection campaign in the process.
In 2016, Catholic Charities applied for an exemption to Wisconsin's state unemployment insurance tax (UIT). That tax is collected by employers in the state and deposited into a fund that workers can draw from if they lose a qualifying job. Wisconsin law exempts religious organizations from this tax, which means their employees would not qualify for state unemployment benefits if they were fired or laid off. The Wisconsin Department of Workforce Development (DWD) denied Catholic Charities' request, stating that the organization wasn't "operated primarily for religious purposes." Catholic Charities sued, and the Wisconsin Supreme Court sided with the DWD, adding that Catholic Charities doesn't "proselytize and serve everyone."
The Becket Fund filed an appeal on behalf of Catholic Charities, and the U.S. Supreme Court ruled 9-0 in its favor.
But rather than allow Catholic Charities to receive the exemption as well, AG Kaul returned to the state Supreme Court and asked it to remove the UIT exemption for all religious organizations.
Yesterday, the Wisconsin Supreme Court ruled in favor of Catholic Charities.
BREAKING: Wisconsin just lost to Catholic Charities—again. After its 9–0 defeat at the U.S. Supreme Court this summer, the Wisconsin high court today blocked Attorney General Josh Kaul’s (@WisDOJ) shocking attempt to circumvent that unanimous ruling.
— Eric Rassbach (@ericrassbach) December 15, 2025
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In a press release, the Becket Fund applauded this ruling, writing:
The Wisconsin Supreme Court today blocked the state’s rece
nt effort to defy the U.S. Supreme Court’s unanimous ruling in Catholic Charities Bureau v. Wisconsin Labor & Industry Review Commission. In June, all nine Justices rejected Wisconsin Attorney General Josh Kaul’s argument that Catholic Charities’ care for the poor and needy wasn’t religious enough to qualify for a religious exemption from the state’s unemployment tax law. (Watch this video to learn more). But instead of complying with that decision, state officials asked the state’s high court to eliminate the exempti on entirely. In its ruling today, the Wisconsin Supreme Court denied this request and ruled that Catholic Charities is entitled to the exemption. In the Supreme Court’s 9-0 ruling this past summer, Justice Sonia Sotomayor explai
ned that Wisconsin had violated federal law by “impos[ing] a denominational preference by differentiating between religions based on theological lines.” The Court further recognized that “whether to express and inculcate religious doctrine through worship, proselytization, or religious education when performing charitable work are, again, fundamentally theological choices driven by the content of different religious doctrines.” “You’d think Wisconsin would take a 9-0 Supreme Court loss as a hint to stop digging,” said Eric Rassbach, vice president and senior counsel at Becket. “But apparently Att
orney General Kaul and his staff are gluttons for punishment. Thankfully, the Wisconsin Supreme Court put an end to the state’s tomfoolery and confirmed that Catholic Charities is entitled to the exemption it already won.”
In its order, the Wisconsin Supreme Court said that Catholic Charities is "eligible for the religious purposes exemption."
In its order, the Wisconsin Supreme Court finally held that Catholic Charities “is eligible for the religious purposes exemption.” https://t.co/VU1rkthD3W pic.twitter.com/vSSFVcW70S
— Eric Rassbach (@ericrassbach) December 15, 2025
This is not just a win for Catholic Charities, but for all religious organizations in Wisconsin.
The Wisconsin Supreme Court’s ruling protects not only Catholic Charities, but every faith-based organization that relies on this exemption to serve the public. It turns out that penalizing charities is not a winning legal strategy.
— Eric Rassbach (@ericrassbach) December 15, 2025
Remember, Kaul sought to remove the exemption for all religious organizations, which would have significant financial implications.
State and federal unemployment insurance taxes would cost a religious organization roughly $440 to $490 per employee, per year. Depending on the organization's size and number of employees, this can mean a few thousand dollars more annually or tens of thousands more. When organizations rely on thin budgets and donations to survive, it can lead to financial strain and even closure.
You'd think Josh Kaul would've gotten the hint. But nope, the Wisconsin supreme court had to smack him down after the 9-0 beatdown he received from SCOTUS proved insufficiently educative. https://t.co/CGbH6jXfg5
— Varad Mehta (@varadmehta) December 15, 2025
And Kaul is running for reelection. Keep that in mind.
This is wild.
— Paul Taske (@Paul_Taske) December 16, 2025
SCOTUS properly recognized that WI cannot favor certain religions over others.
WI doubled down and said “fine, if we can’t disadvantage the religious groups we want we’ll go after all of them”
That’s a pretty clear indication that its intent is to go after… https://t.co/SkplGLyoNg
"That's a pretty clear indication that its intent is to go after religion. Again, people, we have a First Amendment," Taske wrote.
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