2025 uS Executive Orders, DEI, and Employment: how In-house Lawyers can help Business
Remind me, what’s an executive order?
Executive orders are regulations purchased by the president of the United States that direct government firms and officials to take specific actions. While they are not laws, they have the force of law and effect how existing laws are executed or enforced.
Executive orders impact the agencies of the executive branch and for that reason do not need the approval of Congress. They need to be within the president’s constitutional authority and may be challenged in court if deemed unconstitutional.
Executive orders might be rescinded, overturned by future presidents, or challenged in court, and enforcement priorities can alter throughout any administration.
The new administration’s actions have far-reaching results beyond executive orders. For more on mitigating danger, global organizations can take new opportunities by remaining active.
Implications of the executive orders for DEI efforts and employment in private-sector companies
On Jan. 21, President Trump provided “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” which reverses numerous prior executive orders and memoranda, consisting of Executive Order 11246 (EO 11246) checked in 1965 by President Lyndon B. Johnson.
EO 11246 required every government contract to consist of a declaration that the specialist will not victimize any employee or candidate 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 altering enforcement top priorities in the brand-new administration. The order directs all federal companies to “combat 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 rights office, indicating his record of “suing corporations who use ‘woke’ policies to victimize their employees.”
In addition to withdrawing EO 11246, the Jan. 21 executive order instructs each agency of the federal government to recognize “up to nine possible civic compliance investigations” of private sector entities within 120 days of the order – by May 21, 2025.
The economic sector entities based on these investigations consist of publicly traded corporations, large nonprofits – including 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 staff members respond to the business’s actions?
– How will clients and stakeholders respond?
What internal counsel must think of:
Assess any federal agreements and grants
– Determine if they consist of any terms or conditions connected to DEI that might contravene existing laws and guidelines
Review your organization’s existing DEI policies to comprehend your risk
– Prepare for increased scrutiny and potential civil compliance examinations
Document, file, document
– Hiring and recruitment procedures
– Performance evaluations and promotion 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 particular terms in every agreement or job grant award:
– “A term requiring the contractual counterparty or grant recipient to concur that its compliance in all respects with all suitable Federal anti-discrimination laws is material to the government’s payment decisions 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 suitable 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 imposes civil charges on those who make incorrect claims to the federal government in order to influence the payment or receipt of money or residential or commercial property.
The accreditation requirement brings a possible risk of litigation for federal contractors under the False Claims Act. In-house legal representatives at federal professionals hence have a particular interest in ensuring their organization’s policies, procedures, practices, communications and content, are reviewed. Assess if changes are needed to mitigate the threat of lawsuits.
Executive orders targeting illegal migration
President Trump’s initial flurry of executive orders consisted of many – such as the Jan. 20 executive order “Protecting the American People Against Invasion” – focused on limiting unlawful immigration and deporting illegal immigrants. The orders require enforcement actions by federal firms against prohibited immigration.
In-house legal representatives need to consider evaluating their company’s employment eligibility confirmation procedure. They might also wish to think about whether the organization is prepared for reacting to an I-9 audit or a worksite enforcement action (or raid) by migration enforcement agencies.
Sectors that might be especially impacted include farming, hospitality, and other markets such as building and 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 a crucial role to play in establishing and guaranteeing consistent application of the Form I-9 and job E-Verify guidelines the federal government utilizes to carry out and impose immigration law, shares John W. Mazzeo, AGC, director of I-9 and E-Verify compliance for Vertical Screen, Inc., in a 2024 ACC Docket post.
Take a look at useful lists of factors to consider appropriate for in-house legal representatives on the topic 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 company could start an I-9 audit if they felt an employer was obstructing their need to detain a non-citizen employee, or in many cases get a criminal warrant from a judge if actions support it.
Steps internal counsel ought to think about:
– Determine how lots of employees might potentially be affected
– Review your organization’s work eligibility confirmation procedure
– Ensure your company’s procedure is and defensible
– Implement and impose clear policies
– Monitor legal developments, consisting of lawsuits and enforcement assistance
Mitigate threat, stay active, and seize brand-new opportunities
The recent executive orders will considerably affect worldwide organizations. Legal departments and internal counsel will need to assist their organizations comprehend and adapt to modifications, guaranteeing compliance or job litigating when proper.
A number of the brand-new administration’s choices will play out over the coming months, including brand-new executive orders and legal difficulties. The Docket will continue to keep track of developments. Global in-house lawyers ought to get ready for rapid advancements associated with:
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 additional tariffs on imports from China. The previous 2 were both delayed by a month as the administration engages in settlements. Meanwhile, China has started its own retaliatory measures on US products. He had formerly revealed his intent to impose 25-percent escalating tariffs on Colombia (an action that was eventually not taken).
Technology and intellectual home. Among the president’s very first actions was to rescind the previous administration’s AI executive order. The new administration also extended a grace duration for TikTok’s approaching ban, sending waves throughout the technology sector, both in the United States and abroad.
Energy, environment, and job health. The president likewise withdrew the United States from the Paris Climate Agreement and the World Health Organization, putting an early emphasis on American energy self-reliance and far from the previous administration’s worldwide sustainability efforts.
Steps in-house counsel ought to consider:
– Assess the effect of potential tariff boosts on supply chain and organization continuity.
– Assess the organization’s reliance on social networks platforms, such as for marketing purposes, and the prospective requirements to backup social networks information and assets in the event their preferred platform ceases to be available.
– Consider how developments in the brand-new administration’s approach to environmental, sustainability and governance concerns may impact the company’s ESG strategy.
Disclaimer: The info in any resource in this website need to not be interpreted as legal suggestions or as a legal opinion on particular truths, and ought to not be considered representing the views of its authors, its sponsors, and/or ACC. These resources are not intended as a definitive declaration on the subject addressed. Rather, they are meant to act as a tool offering useful guidance and referrals for the hectic in-house practitioner and other readers.