In the context of the American legal system, the Bill of Rights serves as a fundamental safeguard for individual liberties. The incorporation of these rights through the Fourteenth Amendment has been a critical development in U.S. constitutional law. One specific aspect of this incorporation revolves around the provision regarding the free exercise of religion.
Consider the precedent set by the case Employment Division v. Smith (1990). This case involved two Native American employees who were fired for using peyote during a religious ceremony and subsequently denied unemployment benefits. The Supreme Court ruled against the employees, emphasizing certain key principles regarding religious practices and state law. Which of the following interpretations accurately reflects the outcome and implications of the Smith decision regarding the free exercise clause?