President Obama has turned down a plea from religious groups that they be exempt from an executive order he plans to sign Monday prohibiting federal contractors from discriminating against gay or transgender workers, officials said Friday.
The policy — which will add sexual orientation and gender identity to a long-standing list of protected groups — continues the exemption for religious employers provided by former President George W. Bush, said a senior administration official, who asked not to be named in advance of the formal announcement.
That 2002 exemption allows religious employers to restrict hiring to only members of their own faith, but it doesn't permit the refusal to hire gays on the basis of a religious objection to homosexuality. Ministers will continue to be exempted.
"We need all of our workers to make the most of our talent and ingenuity rather than losing their job based on discrimination," the senior administration official said.
Obama will also sign a second executive order extending for the first time protections against discrimination to federal employees who are transgender.
Obama's strong stand won applause from gay rights groups Friday.
Fred Sainz, a vice president of the Human Rights Campaign in Washington, called the steps "historic and important."
"President Obama deserves a great deal of credit for signing both of these executive orders," said Ian Thompson, legislative representative in the ACLU Washington office. "We were particularly pleased that he rejected calls from some to embrace taxpayer-funded discrimination against LGBT people."
Some faith-based groups had asked Obama for a broader exemption to the new rules.
"We are deeply disappointed," said Jeremy Tedesco, senior legal counsel for Alliance Defending Freedom, a conservative group in Arizona. "An order like this will mandate that religious organizations abandon their religious freedom in order to contract with the federal government."
But Obama's action Monday may not settle the question entirely. In June the Supreme Court ruled that for-profit corporations may not be forced to provide contraception coverage to their employees if they have sincere religious objections. There already are lawsuits pending raising the same question about sexual orientation.
Senior administration officials estimate that the new rules will affect 24,000 companies and 8 million employees.
Although it was long a priority for gay rights groups, Obama had put off the contracting order, saying that he'd rather see Congress pass legislation expanding workforce protections to gays and lesbians.
But there was little hope that such legislation would pass through the Republican-led House of Representatives. As he vowed to make 2014 a "year of action" and increasingly touted his executive power, Obama came under intense pressure to sign the order.
Marianne LeVine in the Washington bureau contributed to this article.