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

Remind me, what’s an executive order?

Executive orders are directives ordered 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 impact how existing laws are implemented or enforced.

Executive orders impact the firms of the executive branch and employment for that reason do not need the approval of Congress. They should 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Executive orders may be rescinded, reversed by future presidents, or challenged in court, and enforcement priorities can alter during any administration.

The new administration’s actions have far-reaching impacts beyond executive orders. For more on mitigating threat, international businesses can seize new chances by staying nimble.

Implications of the executive orders for DEI efforts and employment in private-sector companies

On Jan. 21, President Trump issued “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 required every government agreement to include a statement that the contractor will not discriminate against any employee or candidate for employment based on race, creed, color, or national origin.

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

However, the executive order signals that there might be changing enforcement concerns in the new administration. The order directs all federal agencies to “combat illegal private-sector DEI choices, mandates, 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 “taking legal action against corporations who utilize ‘woke’ policies to victimize their employees.”

In addition to withdrawing EO 11246, the Jan. 21 executive order instructs each company of the federal government to determine “approximately 9 prospective civic compliance investigations” of economic sector entities within 120 days of the order – by May 21, 2025.

The private sector entities based on these investigations include publicly traded corporations, large 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 organization’s danger tolerance?

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

– How will clients and stakeholders respond?

What internal counsel ought to consider:

Assess any federal contracts and grants

– Determine if they include any terms or conditions related to DEI that may contravene existing laws and regulations

Review your organization’s existing DEI policies to understand your danger

– Prepare for increased analysis and possible civil compliance investigations

Document, document, file

– Hiring and recruitment processes

– Performance evaluations and promotion choices

– Training products and participation records

– Any changes to DEI policies

Implications for federal professionals

To name a few steps, the Jan. 21 Executive Order requires the heads of federal agencies to consist of specific terms in every contract or grant award:

– “A term needing the legal counterparty or grant recipient to concur that its compliance in all aspects with all relevant Federal anti-discrimination laws is material to the federal government’s payment choices for functions of section 3729( b)( 4) of title 31, United States Code”; and

– “A term needing such counterparty or recipient to certify that it does not operate any programs promoting DEI that violate any appropriate 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 imposes civil charges on those who make false claims to the federal government in order to influence the payment or receipt of money or property.

The certification requirement carries a potential danger of litigation for federal contractors under the False Claims Act. In-house lawyers at federal specialists hence have a particular interest in ensuring their organization’s policies, treatments, practices, employment interactions and material, are reviewed. Assess if changes are needed to reduce the risk of lawsuits.

Executive orders targeting prohibited immigration

President Trump’s preliminary flurry of executive orders consisted of many – such as the Jan. 20 executive order “Protecting the American People Against Invasion” – focused on limiting unlawful migration and deporting unlawful immigrants. The orders call for enforcement actions by federal firms against unlawful migration.

In-house lawyers should consider examining their organization’s work eligibility verification process. They may likewise wish to think about whether the organization is gotten ready for reacting to an I-9 audit or a worksite enforcement action (or raid) by immigration enforcement companies.

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

In-house counsel have an essential function to play in establishing and ensuring constant application of the Form I-9 and E-Verify regulations the federal government utilizes 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.

Have a look at helpful lists of considerations appropriate for internal lawyers on the topic of I-9 audits and worksite enforcement actions.

If an employer does not comply with a civil administrative warrant provided by US Immigration and Customs Enforcement (ICE), there is a danger that the agency could begin an I-9 audit if they felt an employer was obstructing their requirement to jail a non-citizen employee, employment or in many cases get a criminal warrant from a judge if actions support it.

Steps internal counsel should think about:

– Determine the number of workers could potentially be impacted

– Review your organization’s employment eligibility verification procedure

– Ensure your organization’s procedure is recorded and employment defensible

– Implement and enforce clear policies

– Monitor legal advancements, consisting of lawsuits and enforcement assistance

Mitigate threat, remain nimble, and seize new opportunities

The current executive orders will considerably impact worldwide organizations. Legal departments and internal counsel will need to help their organizations and adjust to modifications, guaranteeing compliance or litigating when proper.

Many of the new administration’s choices will play out over the coming months, consisting of new executive orders and legal difficulties. The Docket will continue to monitor employment developments. Global in-house legal representatives ought to prepare for rapid advancements 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 additional tariffs on imports from China. The previous 2 were both delayed by a month as the administration participates in settlements. Meanwhile, China has actually begun its own vindictive steps on US goods. He had actually previously revealed his intent to impose 25-percent escalating tariffs on Colombia (an action that was ultimately not taken).

Technology and copyright. One of the president’s first actions was to rescind the previous administration’s AI executive order. The new administration also extended a grace duration for TikTok’s impending ban, sending waves throughout the technology sector, both in the United States and abroad.

Energy, employment climate, 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 self-reliance and far from the previous administration’s international sustainability efforts.

Steps internal counsel must consider:

– Assess the effect of potential tariff increases on supply chain and business continuity.

– Assess the company’s reliance on social networks platforms, such as for marketing functions, and the potential requirements to backup social media information and properties in case their preferred platform stops to be offered.

– Consider how developments in the brand-new administration’s technique to ecological, sustainability and governance concerns might affect the company’s ESG strategy.

Disclaimer: The information in any resource in this site need to not be construed as legal advice or as a legal viewpoint on specific truths, and ought to not be thought about representing the views of its authors, its sponsors, and/or ACC. These resources are not intended as a conclusive statement on the subject resolved. Rather, they are intended to serve as a tool providing practical assistance and recommendations for the busy in-house practitioner and other readers.