As a buisness owner your responsibility to your employee begins and ends with his performance in direct relation to duties as an employee, and your reponsibility to pay him accordingly. You have no right to dictate his morality. You have no right to even discuss his morality at work. Unless his job is harmed or affected by his secual orientation... you have no right to discriminate.
You are correct. If I refused to hire someone because I thought they were gay, and the discrimination could be proved, I'd be in big trouble.
About every other year I am required to attend seminars on business ethics, and you would be very surprised on finding exactly what the laws dictate.
However, it is another matter entirely to prove discrimination, and the burden is really on the accuser. If it weren't for that, there would be an incredible amount of lawsuits.
But these marginal service organizations, like charities, the boy scouts, etc.. fall into special categories because of their non profit nature, and religious affiliations. They can get away with things that others in the corporate world cannot, however, by receiving Federal funds, there actions violate federal anti-discrimination laws, and thus they lose their eligibility for federal funding. As it should be.
The salvation army doesn't want to lose its big funding from the government, but they are in violation of federal anti-discrimination laws. Bush should not bend the rules for them, but he will probably try.
Discrimination of any kind should not be encouraged.