Government Contracts Proposed OFCCP Rule Clarifies Scope of Religious Exemption
Tuesday, September 10, 2019

Proposed OFCCP Rule Clarifies Scope of Religious Exemption

By Government Contracts Editorial Staff

The Department of Labor’s Office of Federal Contract Compliance Programs is proposing to clarify the scope and application of the religious exemption in section 204(c) of Executive Order 11246, as amended. Title VII of the Civil Rights Act of 1964 (PL 88-352) extends civil rights protections to employment opportunity and prohibits discrimination on the basis of race, color, religion, sex, or national origin. However, section 702(a) of the legislation allows religious employers to take religion into account for employees performing religious activities, and in 1972, Congress broadened the scope of this exemption to cover all activities of a religious organization, not just religious activities (PL 92-261). E.O. 11246, signed by President Lyndon B. Johnson in 1965, requires equal employment opportunity in federal government contracting. The order mandates that all government contracts include a provision stating that “[t]he contractor will not discriminate against any employee or applicant for employment because of race, creed, color, or national origin.” In 2002, President George W. Bush amended E.O. 11246 by expressly adding Title VII’s exemption for religious organizations (E.O. 13279), and DOL has implemented the exemption at 41 CFR 60-1.5(a)(5). According to OFCCP, some religious organizations are reluctant to participate as federal contractors because of uncertainty regarding the scope of the religious exemption in E.O. 11246 and DOL’s regulations.

Broad Construction. The proposed rule seeks to provide guidance on the scope and application of the religious exemption, consistent with recent Supreme Court decisions, in revisions to 41 CFR 60-1.3, Definitions, and in a new rule of construction at 41 CFR 60-1.5, Exemptions. The rule would clarify that the E.O. 11246 religious exemption covers churches as well as employers that are organized for a religious purpose, hold themselves out to the public as carrying out a religious purpose, and engage in exercise of religion consistent with, and in furtherance of, a religious purpose. The rule would also clarify that religious employers can condition employment on acceptance of or adherence to religious tenets without sanction from the federal government, as long as they do not discriminate based on other protected bases. Further, the rule states that it should be construed to provide the broadest protection of religious exercise permitted by the Constitution and other laws. Comments on the proposed rule are due September 16, 2019. For the text of the rule, see 84 FR 41677.

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