Child limiting policies in the private sector?

As far as employment practices of private businesses go, I'm fairly libertarian in view. They want to exclude workers on the basis of race, creed, sexual orientation, etc. then let 'em have at it. It's their business and in the marketplace they'll be the first to suffer. That thinking is one reason I never got my panties in a knot when applying for a job only to find out one of the requirements was to be a fundamentalist Christian (no Catholics need apply).

But IMO this is over the top (found via Pewsitter at www.courthousenews.com);

HARRISBURG, Pa. (CN) - A married couple who worked as houseparents for a dorm at the Milton Hershey School say they were fired for violating the schools "two-child policy." They claim the only way they could have kept their jobs would have been an abortion, which they find "morally reprehensible."

Chocolate tycoon Milton Hershey founded the residential school in 1909, in the town that bears his name, to help poor children, according to the school's Web site.

Wendy and Andy Loraw had two children when the Hershey School hired them in 2002, they say in their federal complaint. They had a third child in January 2005. The Loraws claim the school enacted its "two-child policy" in January 2005, over the objections of their union, the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, Local 464.

The Loraws' third child was grandfathered in, under a contract clause that stated: "Houseparents having three or more children in the student home or who are pregnant prior to January 15, 2005 will be exempted from this policy at their current number of children."

The Loraws told the school in January 2006 that Wendy was pregnant again, and they were fired in June. They claim their firing violated an arbitrator's ruling that the school had to try to accommodate people in their position, or at least provide severance and benefits.

The Loraws seek punitive damages for housing, gender, pregnancy and employment discrimination. They are represented by Patrick McDonnell of King of Prussia, Pa.