Plan to Nix Trump Religious Contractor Rule Nears Release (1)

Oct. 27, 2021, 11:57 AMUpdated: Oct. 27, 2021, 2:25 PM

A U.S. Department of Labor proposal to rescind a Trump-era rule on religious defenses that federal contractors can use to shield themselves from workplace discrimination claims cleared White House regulatory review, signaling it’s likely to be released soon.

The White House Office of Information and Regulatory Affairs concluded its review of the proposed rule, according to an online notice Wednesday. That’s usually the last step before an agency will publish a regulatory action in the Federal Register.

The Biden administration seeks to undo a rule that the DOL’s Office of Federal Contract Compliance Programs finalized in December, codifying existing exemptions that allow churches and other “religion-exercising organizations” to avoid liability for hiring, firing, or other employment decisions motivated by religious belief.

The rule also extended religious defenses to “closely held” corporations—meaning businesses owned and operated by a small number of people also can rely on the exemptions if they act in accordance with an owner’s religious beliefs.

In March, the OFCCP, which enforces U.S. anti-bias laws among federal contractors, told federal judges in New York and Oregon that it intended to propose rescinding the rule as part of separate lawsuits Democratic attorneys general and unions filed to challenge the regulation. They argued the Trump rule could lead to unequal treatment for LGBT workers, women, and minorities.

(Updated to include the White House regulatory office's notice, in paragraph 2.)

To contact the reporter on this story: Paige Smith in Washington at psmith@bloomberglaw.com

To contact the editors responsible for this story: Jay-Anne B. Casuga at jcasuga@bloomberglaw.com; John Lauinger at jlauinger@bloomberglaw.com

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