President Obama signed an amendment to Executive Order 11246 which was issued by President Lyndon B. Johnson prohibiting federal contractors from discriminating on the basis of sexual orientation or gender identity.  The amendment adds sexual orientation and gender identity to the list of protected categories in the existing Executive Order covering federal contractors.

Executive Order 11246 prohibits federal contractors and federally-assisted construction contractors and subcontractors, who do over $10,000 in government business in one year. The Executive Order also requires covered government contractors to take affirmative action to ensure that equal opportunity is provided in all aspects of their employment.  The Executive Order does not affect the administration of federal grants.  The Order is administered and enforced by the Department of Labor's Office of Federal Contract Compliance Programs.

The amendments to Executive Order 11246 only apply to federal contractors and subcontractors who have covered federal contracts entered into on or after the effective date of the rules promulgated by the Secretary of Labor implementing the Executive Order. Those rules have not yet been issued. Currently, federal law does not prohibit discrimination by private employers based on sexual orientation or gender identity, although a number of state laws prohibit such discrimination.