Labor could be forced to vote against its own legislation to protect gay students from discrimination in religious schools, as support for government changes to the bill grows.
Time is running out for a compromise on changes to the Sex Discrimination Act ahead of a lunchtime Senate vote on Wednesday on Labor's plan, with parliament set to rise for the year on Thursday.
It is understood Centre Alliance's two crucial senators are poised to support a government amendment which has the capacity to sink a deal between the major parties.
The change would give an exemption to discrimination provided it is in good faith and accords with the doctrines, tenets, beliefs or teachings of a religion or creed.
Labor sources say lawyers have advised them the amendment explicitly widens the grounds for discrimination against students.
Attorney-General Christian Porter has warned Labor's plan is a radical overreach, as hopes of a deal wane.
Attorney-General Christian Porter says Labor's bill is a "radical overreach". Source: AAP
Australia's religious leaders are concerned the opposition's plan would extend to churches, synagogues, mosques and temples where religion is taught.
"It should send shock waves through religious Australia and it is sending shock waves through religious Australia," Mr Porter told Sky News.
"Labor's amendment would strip that protection away and that would make unlawful all practices of a teaching and instructive nature."
Labor have consistently argued Senate leader Penny Wong's private bill would not curtail faith-based schools' ability to enforce rules like making students attend chapel services.
"Nothing in this bill would compromise the ability of religious institutions to operate consistently with religious teaching, whether in the classroom or through the enforcement of school rules," Senator Wong told parliament last week.
