Remind me, what's an executive order?
Executive orders are regulations ordered by the president of the United States that direct federal government firms and authorities to take specific actions. While they are not laws, they have the force of law and effect how existing laws are implemented or imposed.
Executive orders impact the agencies of the executive branch and therefore do not need the approval of Congress. They should be within the president's constitutional authority and might be challenged in court if deemed unconstitutional.
Executive orders might be rescinded, reversed by future presidents, or challenged in court, and enforcement concerns can change throughout any administration.
The brand-new administration's actions have far-reaching results beyond executive orders. For more on mitigating risk, worldwide services can take brand-new chances by staying nimble.
Implications of the executive orders for DEI efforts and employment in private-sector companies
On Jan. 21, President Trump issued "Ending Illegal Discrimination and Restoring Merit-Based Opportunity," which reverses numerous prior executive orders and memoranda, including Executive Order 11246 (EO 11246) checked in 1965 by President Lyndon B. Johnson.
EO 11246 needed every federal government contract to consist of a declaration that the professional will not discriminate against any staff member or applicant for employment based upon race, creed, color, or nationwide origin.
Despite President Trump's new executive order, the underlying federal anti-discrimination law remains the same for private-sector employees.
However, the executive order signals that there might be altering enforcement concerns in the new administration. The order directs all federal agencies to "combat unlawful private-sector DEI preferences, requireds, policies, programs, and activities."
In December 2024, President-elect Trump tapped Harmeet K. Dhillon to lead the Justice Department's civil liberties office, indicating his record of "taking legal action against corporations who use 'woke' policies to victimize their workers."
In addition to revoking EO 11246, the Jan. 21 executive order advises each firm of the federal government to identify "approximately 9 possible civic compliance investigations" of economic sector entities within 120 days of the order - by May 21, 2025.
The economic sector entities based on these investigations include publicly traded corporations, large nonprofits - including bar associations - large foundations, and universities whose endowments go beyond US$ 1 billion.
Organizations that may be targeted should ask:
- What is my organization's danger tolerance?
- How will staff members react to the company's actions?
- How will consumers and stakeholders react?
What internal counsel needs to consider:
Assess any federal contracts and grants
- Determine if they include any terms or conditions related to DEI that might contravene present laws and regulations
Review your organization's existing DEI policies to comprehend your danger
- Get ready for increased analysis and employment prospective civil compliance examinations
Document, document, file
- Hiring and recruitment processes
- Performance evaluations and promo choices
- Training products and attendance records
- Any changes to DEI policies
Implications for federal specialists
Among other steps, the Jan. 21 Executive Order needs the heads of federal companies to include particular terms in every contract or grant award:
- "A term needing the legal counterparty or grant recipient to concur that its compliance in all aspects with all applicable Federal anti-discrimination laws is material to the federal government's payment choices for purposes of area 3729( b)( 4) of title 31, United States Code"
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2025 United States Executive Orders, DEI, and Employment: how In house Lawyers can help Business
Abbie Cairns edited this page 1 month ago