A senior Iraqi official has said plans have been drawn up to allow former members of Saddam Hussein's Baath Party to return to government jobs.
The plan is partly a response to fears of Sunni arrest
Supreme National Council for De-Baathification head Ali al-Lamy said the plans could mean the reinstatement of more than a million ex-activists.
The activists were sacked immediately after the US-led invasion in 2003.
Most of them were from Iraq's Sunni minority and the Americans hope the move will contribute to reconciliation.
The most senior former Baath officials, who were close to Saddam Hussein, will remain excluded.
Mr Lamy said a draft law had been prepared which would allow all but the top 1,500 party cadres to return to work or get pensions.
"The law will allow Baathists to return to their offices but not allow them the ideology of the banned Baath party," he said, quoted by AFP news agency.
"We consider those who insist on remaining in the Baath Party to be terrorist elements."
Nuseer al-Ani, a spokesman for Iraqi President Jalal Talabani, said anyone without blood on their hands would be considered.
"Reconciliation is open to all Iraqi parties, even those who carry arms, but whose hands are not stained with Iraqi blood," he said.
Correspondents say the government has been under pressure to revise de-baathification laws to encourage Sunni parties to take a greater part in the reconciliation process.
There are also fears of increased unrest from Sunnis following Sunday's verdict against Saddam Hussein.
The former Iraqi president was sentenced to death by hanging over the killing of 148 people in the mainly Shia town of Dujail following an assassination attempt on him in 1982.