OFCCP issues new rule expanding religious exemption for federal contactors

The U.S. Department of Labor’s (DOL) Office of Federal Contract Compliance Programs (OFCCP) recently released a final rule titled “Implementing Legal Requirements Regarding the Equal Opportunity Clause’s Religious Exemption.” Although the rule may have a short life because of the impending change of presidential administrations, it has the potential for far-reaching implications for federal contractors. The new regulations are effective January 8, 2021.

Preference for ‘individuals of a particular religion’

The new rule relates to Executive Order (EO) 11246, which generally prohibits federal contractors from engaging in discrimination. It also mirrors a provision in Title VII of the Civil Rights Act of 1964, however, that allows religious organizations to show a preference for “individuals of a particular religion” in keeping with the entity’s religious identity.

Thus, the primary focus of the new rule is to clarify how employers with federal contracts might claim the exemption when defending their preference for employees of a particular religion or those who observe a particular religious tenet. It provides new definitions of key terms used in the OFCCP religious exemption: