In his first two days in office, President Donald Trump executed two executive orders that directly impact both public-sector and private-sector employers. The Executive Order titled “Defending Women From Gender Ideology Extremism and Restoring Biological Truth to the Federal Government” marks a significant change in federal policy regarding sex-based classifications. The Executive Order titled “Ending Illegal Discrimination And Restoring Merit-Based Opportunity” represents a significant shift in federal policy regarding diversity, equity, and inclusion (DEI) programs across both public and private sectors.
Some of the key takeaways of “Ending Illegal Discrimination And Restoring Merit-Based Opportunity” include:
Revocation of Executive Order 11246
Federal Contractors and Subcontractors should be aware that this Executive Order immediately revokes Executive Order 11246, which previously established equal employment opportunity requirements for federal contractors. The Order requires that the Office of Federal Contract Compliance Programs cease enforcing “affirmative action” requirements and that all existing affirmative action or “workforce balancing” programs based on legally-protected characteristics be ended within the next 90 days. The Order further notes that all future contracts will include mandatory certifications that companies do not operate DEI programs that violate federal anti-discrimination laws. Notably, the Order preserves Veteran preferences in employment.
Private Sector Enforcement
The Order directs the Department of Justice to develop a strategic enforcement plan within 120 days targeting “egregious and discriminatory DEI practitioners,” primarily
– Publicly traded corporations
– Large non-profits
– Foundations with assets over $500 million
– State/local bar and medical associations
– Higher education institutions with endowments over $1 billion
The Order does not require private corporations and non-profit organizations to end existing DEI programs—it solely seeks to “deter DEI programs or principles (whether specifically denominated “DEI” or otherwise) that constitute illegal discrimination or preferences.” Existing affinity groups and other informal organizations within corporations or organizations may continue, as long as they do not result in employment decisions (including selection for training opportunities) based on legally-protected characteristics.
The “Defending Women From Gender Ideology Extremism and Restoring Biological Truth to the Federal Government” Executive Order immediately rescinds the 2024 Equal Employment Opportunity Commission’s Workplace Harassment Guidance. The Order also requires that all facility-access policies must align with biological sex classifications. The Executive Order directs the Equal Employment Opportunities Commission to shift away from gender-identity protections, while establishing new protections for employees expressing personal views about the “binary nature of sex.” While federal contractors will see new contractual compliance requirements regarding sex-based policies, private-sector employers will likely see increased audits and potential EEOC enforcement activities in alignment with these directives. The Order further directs Health and Human Services Department to issue detailed guidance regarding sex-based definitions in the next 30 days.
Immediate Risk Management Recommendations:
- Begin winding down existing EO 11246 affirmative-action programs.
- Review all existing DEI programs for compliance with applicable federal civil rights laws.
- Consider pausing or modifying DEI initiatives that take into consideration an individual’s legally-protected characteristics in the decision-making process until further guidance is issued.
- Audit internal hiring and promotion practices to ensure they are based on merit-based criteria.
- Revise employee handbooks/training materials referencing gender identity to comply with new sex-based definitions and ensure that facility-access policies align with biological sex classifications.
- Evaluate any federal contracts or grants to ensure compliance with current contracts and prepare for new certification requirements.
- Continue documenting employment decision-making processes to demonstrate compliance with civil rights laws.
Based on these Executive Orders, businesses, schools and non-profit organizations should anticipate increased federal scrutiny of DEI programs and employment policies and procedures and prepare for potential compliance audits. We anticipate litigation challenging the revocation of EO 11246, as well as additional implementation guidance to be developed over the next three months. We recommend maintaining close contact with legal counsel as implementation guidance is developed, particularly regarding gender-based facility-access policies and federal funding requirements.
Please contact a Phillips Murrah labor and employment attorney for assistance in evaluating the impact of changing federal and state rules on your business. We will continue to post updates on new guidance and rules from the DOL and other federal agencies on our website and social media channels.
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