The normally conservative-leaning Iowa Association of Business and Industry will consider a major policy shift at its March 20 quarterly meeting that could be a harbinger of a new era of civil rights protection in the state.

ABI has historically opposed expansion of the Iowa Civil Rights Act to include protections on the basis of sexual orientation and gender identity, arguing that increasing the number of protected classes increases the likelihood of litigation against its member businesses. “Everything is so litigious, and businesses have been concerned about expanding their liability,” said ABI President Michael Ralston. “They don’t want to discriminate, but they don’t want to be sued, either.”

The push to take a second look at the long-standing policy position is coming from member businesses, many of which already have policies in place to protect the individuals targeted in the proposed amendment to the Civil Rights Act.

“The ‘new ABI’ is totally membership-focused,” Ralston said, “and members will carry the day on this. They have worked hard to make their places of employment places of inclusivity, fairness and ethical behavior and they see this position as totally in line with what they are doing.”

The upcoming policy discussion is important as the Iowa Civil Rights Commission reaches out to business leaders to encourage lawmakers to pass an amendment to the Civil Rights Act. Senate File 224, which would add sexual orientation and gender identity to protected classes, was passed by the Senate State Government Committee last week, just in time to survive the March 9   “funnel” deadline.

Positioning Iowa as an inclusive state that values all people regardless of their differences is a key to filling a projected worker shortage, said Alicia Claypool, chairwoman of the Iowa Civil Rights Commission. By 2012, Iowa could have up to 200,000 more jobs than workers to fill them.

“It makes sense to us as civil rights commissioners to look to the minority population to fill a portion of that gap, and women, minorities, the disabled, GLBT (gay, lesbian, bisexual and transgendered) individuals are all prospects,” she said. “There’s also been so much talk for decades about the ‘brain drain,’ and adding sexual orientation to the civil rights code sends an important message that Iowa is a welcoming and inclusive state.

“Our future is tied to this,” she said.

Passage of the proposed legislation is likely in the Senate, but the bill’s fate is uncertain in the House of Representatives, Claypool said. She is asking business leaders to contact legislators and House leaders to urge them to move the bill forward. “Not everybody is protected by our Constitution, by the Bill of Rights, by the founding principles that all men are created equal,” she said. “In America in 2007, that is totally unacceptable. We need to make our democracy real for all people, and that includes   GLBT people.”

The Greater Des Moines Partnership hasn’t taken a position for or against expansion of the Civil Rights Act, but may take the matter up when Jay Byers, the group’s senior vice president for public policy, returns from a scheduled vacation, said Partnership spokeswoman Susan Ramsey.”They prepare the policy agenda in advance [of the legislative session] and this was not on the table for discussion,” she said. “We have no position on this piece of legislation, but that’s not to say we might not  create one.”

She said the group’s Government Policy Council “is responsive when things develop in the session that are important, and we’re doing our best to take their temperature.

For many Iowa companies, expansion of the Civil Rights Act to protect GLBT individuals would amount to the law catching up with policies they have had in place for some time. “In many ways, the business community is ahead of some other sectors on this issue,” Claypool said. “The business community is not known for being flaming liberals. They’re helping to lead the way, and those of us in the civil rights world appreciate that.”

For example, at Principal Financial Group Inc., which employs 16,000 people worldwide, 7,600 of them in Greater Des Moines, policies protecting employees from harassment and discrimination based on their sexual orientation date back 16 years. Earlier this year, the Des Moines-based insurer added gender identity to its non-discrimination policies.

Jim DeVries, Principal’s senior vice president of human resources, said gender identity wasn’t added at the request of an employee or because an issue had been raised, but because the company likes to be progressive and proactive. Creating an inclusive atmosphere is “good for employees, good for customers and good for shareholders,” he said. “It’s smart from a business standpoint, but historically, we do this because we think it’s the right thing to do.”

The potential for increased legal exposure was never a serious concern for senior executives when the Des Moines-based insurer’s non-discrimination and anti-harassment policies were expanded, according to DeVries.Concerns about increased litigation should be balanced against the need to create an environment where anyone can work without fear of harassment, he said.

“Any time you expand the law, you do have the potential for increased litigation,” he said. “If there is harassment or discrimination, it’s not going to be tolerated here. That litigation piece wasn’t one that fell into   the mix.”

To survive the Iowa Legislature’s next funnel deadline on March 30, the proposed legislation must gain approval from both the Senate and the House Human Resources  Committee.