AG Grewal Files Lawsuit Challenging Outgoing Administration’s “Midnight Rule” Weakening Anti-Discrimination Protections for Employees of Federal Contractors

For Immediate Release: January 21, 2021

Office of The Attorney General
– Gurbir S. Grewal, Attorney General
Division of Law
– Michelle Miller, Director

Division on Civil Rights
– Rachel Wainer Apter, Director

For Further Information:

Media Inquiries-
Lee Moore
Citizen Inquiries-

View Complaint

TRENTON – Attorney General Gurbir S. Grewal announced today that New Jersey has joined a multi-state civil rights lawsuit challenging a U.S. Department of Labor (DOL) rule that weakens protections for employees of federal contractors by making it easier for federal contractors to discriminate against employees and prospective employees on the basis of basis of race, color, religion, sex, sexual orientation, gender identity, or national origin.

At issue is a “midnight rule” promulgated by DOL in December 2020 during the lame-duck period at the end of the Trump Administration. Among other things, the rule exempts certain contractors that operate as for-profit entities from anti-discrimination requirements that have been in place since an Executive Order issued by President Lyndon B. Johnson in 1965.

The rule also allows contractors to condition employment on an employee or prospective employee’s adherence to particular religious tenets. These new policies depart from longstanding rules—which the plaintiff States do not challenge—allowing non-profit religious organizations that contract with the federal government to express a “preference” for individuals of the same religion in employment decisions.

New Jersey and the other States participating in today’s lawsuit contend that the rule unlawfully makes it easier for federal contractors to engage in employment discrimination against LGBTQ workers, women, religious minorities and others.

“We stood up for the civil rights of New Jersey residents in court throughout the Trump Administration,” said Attorney General Grewal. “We’ve now entered a new era. But until last-minute rules rammed through in the final days of the last Administration are repealed or struck down in court, we will continue to take action to protect the well-being of our residents.”

“For-profit corporations should not be permitted to impose their owner’s religious beliefs on employees who do not share those beliefs, period,” said New Jersey Division on Civil Rights Director Rachel Wainer Apter. “This regulation will seriously undermine anti-discrimination protections set forth in the landmark Civil Rights Act of 1964. The purpose of that law was to protect civil rights and to ensure equal employment opportunity; this regulation does the opposite.”

Filed in U.S. District Court for the Southern District of New York, today’s lawsuit notes that approximately 20 percent of the entire U.S. workforce is employed by federal contractors, and that the DOL rule at issue will make those workers more vulnerable to discrimination if allowed to stand.

The increase in employment discrimination prompted by the new rule will likely force job changes, cause displacement, and result in unemployment, according to the complaint.

The complaint also alleges that, as a result of the rule, employees will lose opportunities for on-the-job learning and advancement, leading to “the abandonment of well-paying careers,” and a reduction in lifetime earnings.

The complaint asks the court to set aside the new rule because it is arbitrary and capricious and was issued in excess of DOL’s statutory authority.

Deputy Attorney General Elspeth Faiman Hans of the Special Litigation Section within the Division of Law’s Affirmative Civil Enforcement Practice Group is representing the State in the matter.


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