January 29, 2025 – On January 21, 2025, President Trump issued an executive order entitled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity” (“the Order”).

The Order, consisting of eight sections, reflects a race- and sex-blind interpretation of Federal civil rights laws. It takes the position that “diversity, equity, and inclusion” (DEI) and “diversity, equity, inclusion, and accessibility” (DEIA) are “dangerous, demeaning, and immoral race- and sex-based preferences.” It appears intended to curtail or end federal affirmative action.

Section 2 of the Order instructs all executive departments and agencies to terminate “all discriminatory and illegal preferences, mandates, policies, programs, activities, guidance, regulations, enforcement actions, consent orders, and requirements.” It also instructs all agencies to combat “illegal private-sector DEI preferences, mandates, policies, programs, and activities.”

The Order Revokes Several Existing Executive Orders

In Section 3, the Order revokes four executive orders and a presidential memorandum:

• Executive Order 11246 of September 24, 1965 (Equal Employment Opportunity);
• Executive Order 12898 of February 11, 1994 (Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations);
• Executive Order 13583 of August 18, 2011 (Establishing a Coordinated Government-wide Initiative to Promote Diversity and Inclusion in the Federal Workforce);
• Executive Order 13672 of July 21, 2014 (Further Amendments to Executive Order 11478, Equal Employment Opportunity in the Federal Government, and Executive Order 11246, Equal Employment Opportunity); and
• The Presidential Memorandum of October 5, 2016 (Promoting Diversity and Inclusion in the National Security Workforce).

Executive Order 11246, signed by Lyndon Johnson, prohibited federal contractors from discriminating against employees because of race, color, religion, sex, or national origin and required them to take affirmative action to ensure that applicants and employees were treated without regard to these characteristics. Executive Order 11246 also mandated that federal contractors who met certain requirements develop and maintain written affirmative action programs and conduct annual reviews of their hiring, promotion, termination and compensation practices and activities. Employers may still elect to comply with Executive Order 11246 until 90 days after January 21, 2025.

Section 3 of the Order also orders the Office of Federal Contract Compliance Programs (“OFCCP”) to immediately cease promoting diversity, holding federal contractors responsible for taking affirmative action, and allowing or encouraging federal contractors and subcontractors to engage in workforce balancing based on race, color, sex, sexual preference, religion, or national origin. Moreover, the “employment, procurement, and contracting practices” of federal contractors and subcontractors shall not consider any of those characteristics “in ways that violate the Nation’s civil rights laws.” Into every contract or grant award, the head of a federal agency is now required to include a term requiring the contractor or grant recipient to agree that compliance with federal anti-discrimination laws is material to the government’s payment decisions and a term requiring federal contractors and subcontractors to certify that they do not operate any programs promoting DEI.

Finally, Section 3 directs the Director of the Office of Management and Budget and the Attorney General to revise government processes to comply with the new requirements and remove references to diversity, equity, and inclusion principles from federal grants, contracts, programs, and mandates.

Scope of the Order

Section 7 of the Order outlines its scope. It does not apply to federal or private sector employment preferences for veterans in the U.S. armed forces or to blind employees protected by the Randolph-Sheppard Act. The Order also states that it does not prevent State or local governments, Federal contractors, or Federally-funded State and local educational agencies or institutions of higher education from engaging in First Amendment-protected speech. Nor does the Order prohibit individuals teaching at a Federally funded institution of higher education as a part of a larger course of academic instruction from advocating for, endorsing, or promoting the employment or contracting practices prohibited by this order.

Provisions Applicable to Private Employers that are Not Federal Contractors

Although the Order does not apply directly to private employers who are not federal contractors or subcontractors, its scope reaches beyond federal contractors and internal federal programs. Section 4 is entitled “Encouraging the Private Sector to End Illegal DEI Discrimination and Preferences.” It instructs the heads of federal agencies to advance the policies of “individual initiative, excellence, and hard work” in the private sector and directs the Attorney General, in consultation with federal agency heads and the Director of OMB, to submit, within 120 days of this order a report containing recommendations for enforcing Federal civil-rights laws and taking measures to encourage the private sector to end “illegal discrimination and preferences, including DEI.”

Key Takeaways

The Order instructs OFCCP to immediately cease:

(A) Promoting “diversity”;

(B) Holding Federal contractors and subcontractors responsible for taking “affirmative action”; and

(C) Allowing or encouraging Federal contractors and subcontractors to engage in workforce balancing based on race, color, sex, sexual preference, religion, or national origin.

Based on these instructions to OFCCP, it seems that any previous OFCCP requirements that an employer was in the process of attempting to comply with, other than those related to veterans or disabled employees, are now declared void. The Order also seems to halt any enforcement action of the OFCCP related to affirmative action plans. Although the OFCCP still exists, its scope of enforcement initiatives appears to be more limited than before. We expect further developments and clarifications as the effects of this action ripple out.

The Order makes no mention of other contracting obligations that federal contractors or subcontractors are required to follow under federal law, such as the Davis Bacon Act, the McNamara O’Hara Service Contract Act, the Walsh-Healey Public Contracts Act, and the National Labor Relations Act, among others.

Lastly, all private employers, including federal contractors or subcontractors, are still required to follow various local, state, and federal anti-discrimination laws that protect employees on the basis of race, color, national origin, religion, sex, sexual orientation, gender identity, disability, and more.

Next Steps

• Federal subcontractors should review their contracts with customers to determine whether they are obligated to continue creating and maintaining affirmative action programs as part of the performance of a contractual duty to such customers. Any obligations will likely depend on how the applicable contract clause is written. If an agreement simply states that the employer will comply with the terms of Executive Order 11246 and its implementing regulations, including the creation of affirmative action plans, one could argue that the employer has no more contractual obligation to the customer to create affirmative action plans now that Executive Order 11246 no longer is in force. On the other hand, if a contract simply states that the employer agrees to maintain affirmative action plans for women and minorities, then the employer may still be contractually obligated to maintain those affirmative action plans.
• Employers should also be aware that some states (such as Minnesota, Wisconsin, Oregon, and Kentucky) and local municipalities have their own affirmative action plan requirements which are not changed by the Order.
• On January 23, 2025, the OFCCP made its first official agency communication since the Order. The communication confirmed that requirements under Section 503 of the Rehabilitation Act, 29 U.S.C. 793, and the Vietnam Era Veterans’ Readjustment Assistance Act (VEVRAA), 38 U.S.C. 4212, which are statutory, will remain in effect and are enforced by OFCCP. As such, employers who are also federal contractors must continue to comply with their obligations under those statutes, including the development of AAPs for protected veterans and the disabled.
• The OFCCP’s communication also stated that “additional information regarding OFCCP’s current activities will be forthcoming in the upcoming weeks.”

This is a rapidly changing area of the law and Kullman will continue to monitor these developments and update you as they occur. For more information on how these changes may affect your workplace policies or compliance obligations, please contact any Kullman attorney you regularly work with.