President Obama flexed his executive authority on Monday by signing an order that bans workplace discrimination against lesbian, gay, bisexual and transgender employees of federal contractors and the U.S. government.

The first part of the order prohibits government contractors that receive federal funding from firing or harassing their employees based on their sexual orientation or gender identity. The second part explicitly bans discrimination against transgender employees of the federal government.

"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," the president at the White House said, CBS News reports. "America's federal contracts should not subsidize discrimination against the American people."

The order affects about 24,000 companies and covers around 28 million workers who make up one-fifth of the country's workforce.

"America's federal contracts should not subsidize discrimination against the American people," Obama said, according to the Huffington Post. "I'm going to do what I can with the authority I have to act."

Senior administration officials said the provision affecting federal employees will take effect immediately, while the part that protects employees of federal contractors will be enforced starting early next year.

Despite pressure from the faith community, the order does not include an exemption for religious organizations.

On July 1, a group of religious leaders petitioned Obama to exempt groups whose religious beliefs oppose homosexuality from an executive order that would ban federal contractors from discriminating against gays and lesbians, reported the The New York Times. In essence, this would allow them to consider sexual orientation when making decisions about hiring and firing.

The letter was signed by many of Obama biggest supporters in the religious community, including Michael Wear, the former director of the Obama's faith outreach campaign in 2012, and mega Pastor Rick Warren, who delivered the invocation at Obama's 2008 inauguration.