Matthew J. DeVries | Best Practices Construction Law
On January 21, 2025, President Trump signed an executive order titled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity.” This sweeping action revoked Executive Order 11246, a policy that had guided federal contractors on affirmative action and anti-discrimination measures since 1965. The new directive eliminates requirements for federal contractors to maintain affirmative action programs, reshaping the landscape for companies working with the federal government.
The changes bring both challenges and opportunities, requiring contractors to act swiftly to remain compliant. There are actionable steps for federal contractors to take now and over the next 90 days, which can easily be understood by looking at the change in policy.
What Has Changed?
Under Executive Order 11246, federal contractors were required to: (1) prohibit discrimination based on race, color, religion, sex, sexual orientation, gender identity, or national origin; (2) implement affirmative action plans to address underrepresentation and promote workplace diversity; and (3) comply with audits conducted by the Office of Federal Contract Compliance Programs (OFCCP).
President Trump’s order eliminates these obligations and prohibits federal contractors from maintaining diversity, equity, and inclusion (DEI) programs that may be seen as violating anti-discrimination laws. Moving forward, federal contractors must:
- Certify compliance with all federal anti-discrimination laws.
- Remove DEI-related programs from their contracts and operations.
- Cease any efforts to balance workforce representation based on protected characteristics.
The changes will officially take effect on April 21, 2025, providing contractors a 90-day window to adjust their policies and practices.
Immediate Steps for Federal Contractors
Federal contractors need to act now to ensure compliance with the new regulations. Here’s a roadmap for navigating this transitional period, which includes a comprehensive policy audit and evalution of workforce roles:
- Review Affirmative Action Plans: Assess current affirmative action and DEI programs to identify elements that may violate the new directive.
- Update Employment Policies: Ensure hiring, promotion, and pay practices align strictly with anti-discrimination laws without referencing affirmative action goals.
- Remove DEI References: Eliminate references to DEI initiatives from internal and external communications, including contracts, employee handbooks, and training materials.
- Reassess DEI Roles: If your organization employs diversity officers or teams, redefine their roles to focus on broader compliance rather than DEI-specific objectives.
- Train HR and Legal Teams: Ensure HR and legal teams understand the new requirements and are equipped to handle questions or challenges related to the changes.
Tasks to Complete Within 90 Days
As the April 21, 2025 compliance deadline approaches, contractors should focus on these critical tasks:
- Impelement Policy Changes: Finalize updates to workplace policies and procedures to eliminate affirmative action-related elements. Communicate changes clearly to employees, ensuring they understand the rationale and new expectations.
- Update Contract Documents: Review and revise contracts with federal agencies to certify compliance with the new executive order. Remove clauses related to affirmative action and DEI from active contracts and proposals.
- Audit Workforce Data: Conduct a review of workforce demographics and historical affirmative action datae. Ensure no policies inadvertently create the appearance of DEI-related preferences or quotas.
Preparing for the Future of Federal Contracting
The revocation of Executive Order 11246 is a significant policy shift, but it may not be the final word on affirmative action and DEI requirements. Contractors should remain vigilant for potential legal challenges or further policy changes under future administrations. Some states maintain their own affirmative action or DEI requirements. Contractors operating in multiple jurisdictions should monitor state-level policies to avoid conflicts or non-compliance.
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