US companies working with the government are no longer allowed to discriminate on the grounds of sexuality or gender identity following the signing of a new executive order by President Barack Obama.

While former President Bill Clinton banned workplace discrimination against gay people within the Federal Government, the new order goes further by extending protection to trans* people and contractors working with Washington departments.

It is estimated companies which hold federal contracts employ one in five US workers.

“It doesn’t make much sense, but today in America, millions of our fellow citizens wake up and go to work with the awareness that they could lose their job, not because of anything they do or fail to do, but because of who they are  lesbian, gay, bisexual, transgender,” Obama said.

“And that’s wrong. We’re here to do what we can to make it right – to bend that arc of justice just a little bit in a better direction.”

The order does not provide exemption for religious groups, ignoring pleas from faith leaders.

Obama told a crowd of a several hundred gay rights activists and lawmakers at the signing that their “passionate advocacy and the irrefutable rightness of your cause” led to move.

The move puts further pressure on Congress which has so far failed to pass the Employment Non-Discrimination Act which would extend discrimination laws to LGBTI people in all workplaces countrywide.

The act is stuck in America’s lower house despite it being passed by the Senate and a Public Religion Research Institute poll in May which showed one in seven supported protecting the rights of LGBTI people at work.

According to PinkNews, Andre Banks from US equality group All Out said: “In a single, bold action, President Obama has thrown open the doors of opportunity for millions of lesbian, gay, bi and trans employees.

“The executive orders set a powerful statement for similar policies at home and abroad.

“Today, the President has stood up for the powerful and proven idea that employment protections are good business and good policy — without loopholes and compromises that create opportunities to discriminate against a person because of who they are or whom they love.”


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