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 purchased by the president of the United States that direct government companies and officials to take particular actions. While they are not laws, they have the force of law and effect how existing laws are implemented or implemented.
Executive orders affect the agencies of the executive branch and therefore do not need the approval of Congress. They must be within the president’s constitutional authority and may be challenged in court if considered unconstitutional.
Executive orders may be rescinded, reversed by future presidents, or challenged in court, and enforcement concerns can change throughout any administration.
The new administration’s actions have far-reaching impacts beyond executive orders. For more on mitigating risk, worldwide companies can take new opportunities by remaining nimble.
Implications of the executive orders for DEI initiatives and employment in private-sector companies
On Jan. 21, President Trump released “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” which reverses different prior executive orders and memoranda, consisting of Executive Order 11246 (EO 11246) checked in 1965 by President Lyndon B. Johnson.
EO 11246 needed every government agreement to include a declaration that the contractor will not victimize any staff member or candidate for employment based upon race, creed, color, or nationwide origin.
Despite President Trump’s brand-new executive order, the underlying federal anti-discrimination law remains unchanged for private-sector workers.
However, the executive order signals that there may be altering enforcement top priorities in the brand-new administration. The order directs all federal agencies to “fight unlawful private-sector DEI choices, requireds, policies, programs, and activities.”
In December 2024, President-elect Trump tapped Harmeet K. Dhillon to lead the Justice Department’s civil liberties workplace, pointing to his record of “taking legal action against corporations who use ‘woke’ policies to discriminate against their employees.”
In addition to withdrawing EO 11246, the Jan. 21 executive order instructs each company of the federal government to identify “as much as nine potential civic compliance investigations” of economic sector entities within 120 days of the order – by May 21, 2025.
The private sector entities subject to these examinations include openly traded corporations, big nonprofits – consisting of bar associations – big foundations, and universities whose endowments go beyond US$ 1 billion.
Organizations that may be targeted should ask:
– What is my company’s danger tolerance?
– How will employees respond to the business’s actions?
– How will clients and stakeholders react?
What internal counsel should think of:
Assess any federal contracts and grants
– Determine if they contain any terms or conditions related to DEI that might clash with present laws and regulations
Review your organization’s existing DEI policies to understand your risk
– Prepare for increased analysis and prospective civil compliance examinations
Document, file, document
– Hiring and recruitment processes
– Performance examinations and promo choices
– Training materials and participation records
– Any modifications to DEI policies
Implications for federal contractors
To name a few measures, the Jan. 21 Executive Order requires the heads of federal companies to include specific terms in every contract or grant award:
– “A term needing the contractual 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 decisions for purposes of area 3729( b)( 4) of title 31, United States Code”; and
– “A term requiring such counterparty or recipient to accredit that it does not run any programs promoting DEI that break any applicable Federal anti-discrimination laws.”
Section 3729 of title 31 of the United States Code is an arrangement of the US False Claims Act, a federal law that enforces civil charges on those who make incorrect claims to the federal government in order to influence the payment or receipt of money or home.
The accreditation requirement carries a possible danger of litigation for federal contractors under the False Claims Act. In-house attorneys at federal professionals therefore have a particular interest in guaranteeing their company’s policies, treatments, employment practices, interactions and material, are evaluated. Assess if modifications are needed to alleviate the risk of litigation.
Executive orders targeting illegal immigration
President Trump’s preliminary flurry of executive orders included numerous – such as the Jan. 20 executive order “Protecting the American People Against Invasion” – targeted at restricting unlawful migration and deporting unlawful immigrants. The orders require enforcement actions by federal firms versus unlawful immigration.
In-house legal representatives should think about evaluating their company’s employment eligibility verification procedure. They might also want to consider whether the company is gotten ready for reacting to an I-9 audit or a worksite enforcement action (or raid) by immigration enforcement agencies.
Sectors that may be particularly affected consist of agriculture, hospitality, and other industries such as construction. From 2020-2022, 42 percent of crop farmworkers held no work authorization, according to the US Department of Agriculture. The American Immigration Council estimates that more than one million undocumented immigrants operate in hospitality, representing 7.1 percent of the workforce.
In-house counsel have an important role to play in establishing and guaranteeing consistent application of the Form I-9 and E-Verify policies the federal government uses to implement 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.
Have a look at informative checklists of considerations relevant for in-house lawyers on the subject of I-9 audits and worksite enforcement actions.
If a company does not work together with a civil administrative warrant presented by US Immigration and Customs Enforcement (ICE), there is a threat that the firm might commence an I-9 audit if they felt an employer was blocking their requirement to arrest a non-citizen worker, or in some cases obtain a criminal warrant from a judge if actions support it.
Steps in-house counsel should consider:
– Determine how numerous workers could possibly be impacted
– Review your company’s employment eligibility verification process
– Ensure your company’s process is documented and defensible
– Implement and impose clear policies
– Monitor legal developments, consisting of lawsuits and enforcement guidance
Mitigate risk, stay active, and seize brand-new opportunities
The current executive orders will substantially affect worldwide companies. Legal departments and in-house counsel will need to help their organizations understand and adapt to modifications, guaranteeing compliance or litigating when suitable.
A number of the new administration’s decisions will play out over the coming months, employment consisting of new executive orders and legal obstacles. The Docket will continue to keep track of advancements. Global internal lawyers ought to get ready for rapid advancements related to:
Trade and tariffs. On Feb. 1, President Trump bought the imposition of a 25-percent tariff on imports from Canada and Mexico, and 10-percent additional tariffs on imports from China. The previous 2 were both postponed by a month as the administration participates in negotiations. Meanwhile, China has started its own retaliatory measures on US items. He had formerly revealed his intent to impose 25-percent escalating tariffs on Colombia (an action that was eventually not taken).
Technology and intellectual 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 duration for TikTok’s impending ban, sending waves throughout the innovation sector, both in the United States and abroad.
Energy, environment, and health. The president likewise withdrew the United States from the Paris Climate Agreement and the World Health Organization, putting an early focus on American energy independence and away from the previous administration’s worldwide sustainability efforts.
Steps internal counsel must think about:
– Assess the impact of possible tariff increases on supply chain and service continuity.
– Assess the organization’s dependency on social media platforms, employment such as for marketing functions, and the potential needs to networks data and assets in case their preferred platform stops to be offered.
– Consider how advancements in the brand-new administration’s approach to environmental, sustainability and governance problems might impact the company’s ESG method.
Disclaimer: The information in any resource in this website must not be construed as legal suggestions or as a legal viewpoint on specific facts, and ought to not be thought about representing the views of its authors, its sponsors, and/or ACC. These resources are not planned as a conclusive statement on the subject dealt with. Rather, they are intended to work as a tool supplying practical assistance and references for the hectic internal specialist and other readers.
