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2025 United States Executive Orders, DEI, and Employment: how In-house Lawyers can help the Business

Remind me, what’s an executive order?

Executive orders are directives ordered by the president of the United States that direct government companies and authorities to take particular actions. While they are not laws, they have the force of law and effect how existing laws are implemented or imposed.

Executive orders affect the companies of the executive branch and therefore do not require the approval of Congress. They must be within the president’s constitutional authority and might be challenged in court if deemed unconstitutional.

Executive orders may be rescinded, overturned by future presidents, or challenged in court, and enforcement concerns can change throughout any administration.

The brand-new administration’s actions have far-reaching impacts beyond executive orders. For more on mitigating danger, international services can seize new opportunities by staying nimble.

Implications of the executive orders for DEI initiatives and employment in private-sector organizations

On Jan. 21, President Trump issued “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” which reverses different 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 professional will not discriminate versus any employee or candidate for work based upon race, creed, color, or national origin.

Despite President Trump’s brand-new executive order, the underlying federal anti-discrimination law remains unchanged for employment private-sector employees.

However, the executive order signals that there may be changing enforcement top priorities in the new administration. The order directs all federal companies to “combat prohibited 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, pointing to his record of “taking legal action against corporations who use ‘woke’ policies to victimize their workers.”

In addition to withdrawing EO 11246, the Jan. 21 executive order instructs each company of the federal government to recognize “as much as nine potential civic compliance examinations” of economic sector entities within 120 days of the order – by May 21, 2025.

The personal sector entities based on these examinations consist of publicly traded corporations, big nonprofits – including bar associations – big structures, and universities whose endowments surpass US$ 1 billion.

Organizations that may be targeted should ask:

– What is my company’s danger tolerance?

– How will employees react to the business’s actions?

– How will clients and stakeholders react?

What internal counsel ought to think about:

Assess any federal contracts and grants

– Determine if they contain any terms or conditions connected to DEI that might conflict with existing laws and employment regulations

Review your company’s existing DEI policies to understand your risk

– Prepare for increased analysis and possible civil compliance investigations

Document, file, document

– Hiring and recruitment processes

– Performance evaluations and promo decisions

– Training products and attendance records

– Any modifications to DEI policies

Implications for federal contractors

Among other procedures, the Jan. 21 Executive Order requires the heads of federal firms to consist of specific terms in every contract or grant award:

– “A term requiring the contractual 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 choices for purposes of area 3729( b)( 4) of title 31, United States Code”; and

– “A term needing such counterparty or recipient to certify that it does not run any programs promoting DEI that breach any relevant Federal anti-discrimination laws.”

Section 3729 of title 31 of the United States Code is a provision of the US False Claims Act, a federal law that enforces civil penalties on those who make incorrect claims to the government in order to influence the payment or invoice of money or home.

The certification requirement brings a potential risk of lawsuits for federal specialists under the False Claims Act. In-house attorneys at federal contractors therefore have a specific interest in guaranteeing their company’s policies, procedures, practices, interactions and content, are evaluated. Assess if changes are required to alleviate the risk of lawsuits.

Executive orders targeting unlawful immigration

President Trump’s preliminary flurry of executive orders included lots of – such as the Jan. 20 executive order “Protecting the American People Against Invasion” – aimed at restricting unlawful immigration and deporting unlawful immigrants. The orders call for enforcement actions by federal firms against prohibited migration.

In-house legal representatives should think about evaluating their organization’s employment eligibility verification procedure. They may also desire to consider whether the is prepared for reacting to an I-9 audit or a worksite enforcement action (or raid) by immigration enforcement agencies.

Sectors that might be particularly affected consist of farming, hospitality, and employment other markets such as building and construction. From 2020-2022, 42 percent of crop farmworkers held no work permission, according to the US Department of Agriculture. The American Immigration Council approximates that more than one million undocumented immigrants operate in hospitality, representing 7.1 percent of the workforce.

In-house counsel have a crucial function to play in developing and ensuring consistent application of the Form I-9 and E-Verify guidelines the federal government uses to carry out and impose migration law, shares John W. Mazzeo, AGC, director of I-9 and E-Verify compliance for Vertical Screen, Inc., in a 2024 ACC Docket article.

Check out informative checklists of factors to consider relevant for internal lawyers on the subject of I-9 audits and worksite enforcement actions.

If an employer does not comply with a civil administrative warrant presented by US Immigration and Customs Enforcement (ICE), there is a risk that the firm might start an I-9 audit if they felt a company was obstructing their requirement to jail a non-citizen staff member, or in some cases acquire a criminal warrant from a judge if actions support it.

Steps in-house counsel should think about:

– Determine the number of workers could potentially be affected

– Review your organization’s work eligibility confirmation procedure

– Ensure your organization’s procedure is documented and defensible

– Implement and impose clear policies

– Monitor legal advancements, consisting of lawsuits and enforcement assistance

Mitigate risk, stay active, and take new opportunities

The current executive orders will considerably impact international organizations. Legal departments and internal counsel will require to assist their companies understand and adjust to changes, guaranteeing compliance or litigating when proper.

A number of the new administration’s choices will play out over the coming months, including new executive orders and legal obstacles. The Docket will continue to keep track of developments. Global internal attorneys should prepare for rapid developments connected to:

Trade and tariffs. On Feb. 1, President Trump ordered the imposition of a 25-percent tariff on imports from Canada and Mexico, and 10-percent extra tariffs on imports from China. The former 2 were both delayed by a month as the administration participates in settlements. Meanwhile, China has started its own vindictive measures on US items. He had formerly revealed his intent to impose 25-percent escalating tariffs on Colombia (an action that was ultimately not taken).

Technology and intellectual residential or commercial property. One of the president’s very first actions was to rescind the previous administration’s AI executive order. The brand-new administration likewise extended a grace period for TikTok’s impending ban, employment sending waves throughout the technology sector, both in the United States and abroad.

Energy, climate, and health. The president also withdrew the United States from the Paris Climate Agreement and the World Health Organization, putting an early emphasis on American energy self-reliance and away from the previous administration’s international sustainability efforts.

Steps in-house counsel ought to consider:

– Assess the effect of possible tariff increases on supply chain and business connection.

– Assess the organization’s dependence on social media platforms, such as for marketing functions, and the prospective needs to backup social media information and assets in the event their preferred platform ceases to be available.

– Consider how advancements in the brand-new administration’s approach to environmental, sustainability and governance concerns may impact the company’s ESG strategy.

Disclaimer: The information in any resource in this website must not be interpreted as legal advice or as a legal viewpoint on specific realities, and need to not be considered representing the views of its authors, its sponsors, and/or ACC. These resources are not meant as a definitive statement on the subject resolved. Rather, they are meant to serve as a tool providing practical guidance and recommendations for the hectic in-house professional and other readers.