Remind me, what's an executive order?
Executive orders are regulations bought by the president of the United States that direct federal government agencies and officials to take particular actions. While they are not laws, they have the force of law and impact how existing laws are implemented or imposed.
Executive orders affect the firms of the executive branch and for that reason do not need the approval of Congress. They must be within the president's constitutional authority and may be challenged in court if deemed unconstitutional.
Executive orders may be rescinded, overturned by future presidents, or challenged in court, and enforcement priorities can alter during any administration.
The new administration's actions have far-reaching impacts beyond executive orders. For more on mitigating risk, global businesses can seize brand-new chances by staying active.
Implications of the orders for DEI efforts and work 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) signed in 1965 by President Lyndon B. Johnson.
EO 11246 required every government contract to include a statement that the contractor will not victimize any staff member or applicant for employment based on race, creed, color, or nationwide origin.
Despite President Trump's brand-new executive order, the underlying federal anti-discrimination law stays unchanged for private-sector employees.
However, the executive order signals that there may be changing enforcement top priorities in the brand-new administration. The order directs all federal agencies to "fight illegal private-sector DEI choices, mandates, policies, programs, and activities."
In December 2024, President-elect Trump tapped Harmeet K. Dhillon to lead the Justice Department's civil rights office, pointing to his record of "taking legal action against corporations who use 'woke' policies to discriminate against their workers."
In addition to withdrawing EO 11246, the Jan. 21 executive order advises each firm of the federal government to determine "as much as 9 potential civic compliance examinations" of private sector entities within 120 days of the order - by May 21, 2025.
The personal sector entities based on these examinations consist of openly traded corporations, large nonprofits - including bar associations - big foundations, and universities whose endowments exceed US$ 1 billion.
Organizations that may be targeted should ask:
- What is my organization's threat tolerance?
- How will workers react to the business's actions?
- How will consumers and stakeholders respond?
What internal counsel should think of:
Assess any federal agreements and grants
- Determine if they include any terms or conditions connected to DEI that might conflict with present laws and policies
Review your organization's existing DEI policies to comprehend your risk
- Get ready for increased examination and possible civil compliance examinations
Document, document, file
- Hiring and recruitment procedures
- Performance assessments and promo choices
- Training products and attendance records
- Any modifications to DEI policies
Implications for federal contractors
Among other measures, the Jan. 21 Executive Order requires the heads of federal firms to consist of specific 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 suitable Federal anti-discrimination laws is product to the government's payment decisions for purposes of area 3729( b)( 4) of title 31, United States Code"
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2025 uS Executive Orders, DEI, and Employment: how In house Lawyers can help the Business
Adalberto Goodwin edited this page 2 months ago