But the proposal has met with opposition.
Some argue the ordinance would eliminate gender differences in public restrooms.
"Employers and restaurant and anybody that's covered by the ordinance can properly designate restroom and locker room usage by gender," said Danielle Weatherby, assistant professor of law at the University of Arkansas.
Many churches say the ordinance will affect their hiring practices. The ordinance does not affect how churches hire pastors and religious teachers, where the applicant's beliefs are essential to the job. But for positions, like a receptionist, the anti-discrimination ordinance would apply to both religious organizations and businesses in Fayetteville.
"If a church wanted to hire an individual to serve in a non-secular position and made the hiring decision based on the person's religion, that would not be prohibited by this ordinance," Weatherby said. "My opinion is that is does not violate religious liberties. Individuals and employers are still entitled to hold and practice within the privacy of their own homes their religious beliefs."
If this ordinance goes into effect, Fayetteville would be the first city in the state of Arkansas to adopt such an ordinance.
"At least 200 cities like Fayetteville have passed similar ordinances. It hasn't increased litigation and it hasn't caused uproar in the religious communities of those cities," Weatherby said.