The federal government's religious discrimination bill will undo the hard-won progress which states and territories have made in combating intolerance, a peak equality group has warned.
Equality Australia chief executive Anna Brown slammed the "really, really regressive" step as another Liberal MP broke ranks to publicly raise concerns about the legislation.
But the bill could yet receive bi-partisan support in the Federal Parliament after Labor leader Anthony Albanese endorsed protections for people to practice their faith, provided they didn't open the door to the discrimination of others.
Prime Minister Scott Morrison is set to personally introduce legislation to shield people of faith from discrimination.
The bill, which was published on Tuesday after weeks of speculation, removed some contentious provisions from previous drafts, including a so-called Folau clause which would have made it harder for an employer to sack an individual for expressing their religious belief.
But other contentious elements have survived, including a key provision which would override state laws to protect people who make statements aligned with their religious beliefs.
The protection would only apply to statements which were made "in good faith", and which weren't malicious or which a "reasonable person would consider would threaten, intimidate, harass, or vilify a person or a group of persons".
The new protection has sparked concern among moderate Liberal MPs including Tasmanian Bridget Archer, who fear it could lead to "unintended" consequences.
Ms Brown was "disappointed" and "disturbed" by the Morrison government's plan to use federal legislation to override protections for groups including LGBTIQ+ people, women, and people with disabilities, which are enshrined in state and territory laws.
"The states and territories are progressing reforms to strengthen protections for LGBTI people and other groups," she told The Canberra Times.
"Instead, we're seeing the federal government overriding that progress and clawing back that progress with a bill that would override those protections.
"It is really, really regressive."
Attorney-General Michaelia Cash on Wednesday reiterated that the protection would only apply to statements made in "good faith".
"They can express their personal belief in good faith, and that will not constitute discrimination," she told Perth's 6PR radio.
"If, however, that statement is malicious, or if it's designed to intimidate, or harass or vilify someone, then clearly that is different."
The new bill would also allow religious organisations, such as schools, to give preference to people of the same religion in hiring decisions.
Liberal backbencher Trent Zimmerman had no issue with the concept of religious schools giving preference to people of the same faith.
"But what I'm concerned to ensure [is] in giving preference to staff of the same religion, we are also not opening the door to allowing schools to actually discriminate against someone because of other characteristics, like their sexuality," the North Sydney MP told ABC's RN Breakfast.