“The Commission has advocated for more than 20 years for a Bill to protect against religious discrimination,” Commission President Rosalind Croucher said in its submission.
“However, it is important that our laws do not give preference to one human right over others.”
The consultation period for public submissions to be made over the draft laws ends this Wednesday.
Attorney-General Christian Porter is using the month-long window to consult with religious and community groups over the legislation.
In a statement to SBS News, a spokesperson for the Attorney General said the draft laws were "currently the subject of extensive consultation" including inviting public submissions.
"The Government will respond substantively after all submissions have been received and considered as it works towards presenting a final Bill to the Parliament for consideration," the spokesperson said.
Mr Porter has previously vowed the legislation will act as a “shield” to protect against discrimination rather than a “sword” for others to discriminate.
"The laws will protect people from being discriminated against, but will not give them a licence to discriminate against other people," he said following a Cabinet Meeting in August.
But the Human Rights Commission is warning without significant reform the legislation risks doing just that.
“Our law should not permit discriminatory religious statements to override all other Australian anti-discrimination laws,” Human Rights Commissioner Edward Santow said in its submission.
“Human rights are for everyone. They are indivisible and universal.”
Their submission states that: "the Commission is concerned that … the Bill would provide protection to religious belief or activity at the expense of other rights.”
“The scope of the Bill is overly broad in defining who may be a victim of religious discrimination and, arguably, too narrow in defining who may be found to have engaged in religious discrimination.”
It asserts that a series of aspects within the draft legislation are inherently flawed.
“The Bill ... includes a number of unique provisions that have no counterpart in other anti-discrimination laws and appear to be designed to address high-profile individual cases,” the submission reads.
“The Commission considers that this may lead to unintended and undesirable consequences.”
LGBTIQ+ advocates have noted concern over the draft laws invoking protections that would stop employers from sacking workers for expressing religious views.
Under the proposed legislation companies with revenue of at least $50 million a year would be required to prove that taking this action was necessary for them to avoid “unjustifiable financial hardship to the business”.
It’s been dubbed the “Folau clause” and would have made Rugby Australia’s sacking of former star player Israel Folau for expressing anti-gay views on social media unlikely.
But in its submission the Human Rights Commission demands such provisions be clarified or taken out of the draft laws.
"This is inconsistent with the acceptance by the Government that discrimination law should reflect the equal status in international law of all human rights," the submission reads.
“No satisfactory explanation has been put forward for treating private sector businesses with an annual revenue of more than $50 million differently from other employers."
The Commission also takes aim at draft clauses dealing with the “separate treatment" of rules over conscientious objections by health practitioners - calling for them to be removed.
“The Commission is concerned that this appears to countenance a wide range of possible adverse health impacts in the name of protecting the freedom of religion of health practitioners,” the submission reads.
It cites the laws could pose possible risks to health services such as abortion, euthanasia, contraception and sterilisation.
“The risk involved in this approach is that patients may lose the ability to obtain ‘information, prescriptions, or referrals',” the submission reads.
“Where, in all the circumstances, it would be reasonable to require health practitioners to provide those services or to make referrals to another health practitioner who is willing to do so.”
Other fears raised by the Commission include the potential for “statements of belief” that would otherwise contravene Commonwealth, State or Territory anti-discrimination laws to be exempt from those protections.
“The Commission considers that this overriding of all other Australian discrimination laws is not warranted [and] sets a concerning precedent,” the submission reads.
It also warns against the potential for corporations such as religious institutions, schools, charities and businesses to make claims based on being discriminated against because of religious views.
“It would be inconsistent with international law to allow corporations to sue people for religious discrimination,” Commissioner Santow said.
"Human rights protect innately human characteristics, and so our human rights law has only ever protected humans."
It warns the legislation could make these bodies exempt from engaging in such discriminatory conduct.
“The Bill provides that ‘religious bodies’ … are entirely exempt from engaging in religious discrimination if the discrimination is in good faith,” its submission reads.
“This is a wide exemption that undercuts protections ... particularly in the areas of employment and the provision of goods and services."
With reforms made to what the Commission calls “problematic provisions” in the draft laws - it supports the principle of the legislation.
“Removing the few highly problematic provisions of the Bill would make it consistent with other Commonwealth discrimination law, while giving strong protection against religious discrimination,” Commissioner Santow said.