OFCCP’s Religious Exemption Rule Rescission to Take Effect March 31, 2023

OFCCP has completed the process of rescinding its Final Rule, Implementing Legal Requirements Regarding the Equal Opportunity Clause’s Religious Exemption” (the “Religious Exemption Rule”), which came into effect on January 8, 2021.

As we previously reported, the Religious Exemption Rule – adopted during the Trump Administration – expanded the existing exemption to religious entities’ compliance with the anti-discrimination provisions of Executive Order 11246 by adding new definitions to “clarify the scope” of EO 11246’s religious exemption. In November 2021, OFCCP proposed to rescind the Religious Exemption Rule, taking the position that the Religious Exemption Rule “departed from and questioned longstanding Title VII precedents,” and “could have the effects of diminishing the economy and efficiency of work performed on Federal contracts and weakening nondiscrimination protections for workers.”

As a result of the Religious Exemption Rule’s rescission, OFCCP states it plans to “return to the department’s prior policy and practice in place during the presidencies of George W. Bush and Barack Obama – of interpreting and applying the religious exemption in Executive Order 11246 consistent with Title VII principles and case law.”  OFCCP acknowledges there is a lack of uniformity in the approaches used by courts in religious exemption cases, but contends relevant Title VII factors are clearly identified and should be weighed on a case-by-case basis.

The rescission will take effect on March 31, 2023.