In the first two days of his second term in office, President Trump issued dozens of executive orders—including several that seek to eliminate diversity, equity, and inclusion (“DEI”) programs and policies across the federal government and in federal contracting, and to encourage the private sector to end such initiatives. This alert summarizes five DEI-related orders¹ issued thus far, including those orders’ potential implications for federal contractors and other private employers.

To the extent an executive order instructs agencies to consider issuing new regulations or rescinding existing regulations, a separate agency process to implement that instruction is typically required.² Changes to existing government contracts would also typically require additional process and legal approvals and may invite litigation. Additionally, legal challenges—like the challenge to President Trump’s executive order attempting to revoke constitutionally protected birthright citizenship³ —could delay the implementation of an order. Even with the likelihood of additional challenges and delays, these orders signal that federal contractors and other private employers should expect increased scrutiny, including government investigations, of DEI initiatives and programs.

Ending Illegal Discrimination and Restoring Merit-Based Opportunity (January 21, 2025)

This Order seeks to ensure that the federal government “enforc[es] our civil rights laws” by “ending illegal preferences and discrimination.”⁴ Among the DEI-related orders issued by President Trump thus far, this Order relates most directly to the private sector: It revokes Executive Order 11246, which applies to federal government contractors; specifies changes to the federal contracting process with potentially significant implications under the False Claims Act; and directs each agency to identify a “strategic enforcement plan” that includes identifying up to nine potential civil compliance investigations of public companies, large nonprofits and foundations, and higher education institutions with endowments over $1 billion, among other entities.

Potential Relevance to the Private Sector:

• Revocation of Executive Order 11246. The Order revokes Executive Order 11246 of September 24, 1965—the longstanding order that prohibits discrimination in federal contracting and requires federal contractors to develop affirmative action plans and ensure equal opportunity.⁵ Contractors “may continue to comply” with Executive Order 11246 and its existing regulatory framework for 90 days from January 20, 2025.⁶
• Federal Contractor Compliance with Civil Rights Laws.
  • The Order directs that the federal contracting process “shall be streamlined to enhance speed and efficiency, reduce costs, and require Federal contractors and subcontractors to comply with our civil-rights laws."⁷ This includes directing the Office of Federal Contract Compliance Programs to “immediately cease . . . [h]olding Federal contractors and subcontractors responsible for taking ‘affirmative action’” and “[a]llowing or encouraging Federal contractors and subcontractors to engage in workforce balancing based on race, color, sex, sexual preference, religion, or national origin.”⁸
  • The Order further directs that all federal contracts and grants shall include a “term requiring the contractual counterparty or grant recipient to agree that its compliance in all respects with all applicable Federal anti-discrimination laws is material,” for purposes of the False Claims Act, to the government’s payment decisions, as well as a “term requiring such counterparty or recipient to certify that it does not operate any programs promoting DEI that violate any applicable Federal anti-discrimination laws.”⁹
• “Encouraging the Private Sector to End Illegal DEI Discrimination and Preferences.” Section 4 of the Order directs the Attorney General to submit a report, within 120 days of the Order, with “recommendations for enforcing Federal civil-rights laws and taking other appropriate measures to encourage the private sector to end illegal discrimination and preferences, including DEI.”¹⁰ The report must contain a “strategic enforcement plan” identifying, among other things:
  • “(ii) The most egregious and discriminatory DEI practitioners in each sector of concern;
  • (iii) A plan of specific steps or measures to deter DEI programs or principles (whether specifically denominated ‘DEI’ or otherwise) that constitute illegal discrimination or preferences. As a part of this plan, each agency shall identify up to nine potential civil compliance investigations of publicly traded corporations, large non-profit corporations or associations, foundations with assets of 500 million dollars or more, State and local bar and medical associations, and institutions of higher education with endowments over 1 billion dollars;
  • (iv) Other strategies to encourage the private sector”¹¹ to end “DEI discrimination and preferences and comply with all Federal civil-rights laws;
  • (v) Litigation that would be potentially appropriate for Federal lawsuits, intervention, or statements of interest; and
  • (vi) Potential regulatory action and sub-regulatory guidance.”¹²
• Limitations on Scope. The Order states that it “does not apply to lawful Federal or private-sector employment and contracting preferences for veterans of the U.S. armed forces or persons protected by the Randolph-Sheppard Act.”¹³ The Order further 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.”¹⁴

Initial Rescissions of Harmful Executive Orders and Actions (January 20, 2025)

This Order revokes 78 Biden-era executive orders, including a number of orders focused on advancing equity and combatting discrimination.  The rescissions include, among others,  Executive Order 13985, President Biden’s “Day One” order on advancing racial equity and support for underserved communities through federal government; Executive Order 14091, which directed federal agencies to undertake additional efforts to effectuate Executive Order 13985; and Executive Order 13988, relating to preventing and combating discrimination on the basis of gender identity or sexual orientation.¹⁵

The Order additionally directs the leaders of each federal agency to “take immediate steps to end Federal implementation of unlawful and radical DEI ideology.”¹⁶

Ending Radical and Wasteful Government DEI Programs and Preferencing (January 20, 2025)

This Order calls for the termination of “all discriminatory programs, including illegal DEI and ‘diversity, equity, inclusion, and accessibility’ (DEIA)” policies and programs across the federal government, including relevant training policies or programs.¹⁷ Among other instructions, the Order directs the White House Office of Management and Budget (OMB), assisted by the Attorney General and the Office of Personnel Management (OPM), to coordinate with agencies to terminate federal programs they deem discriminatory. As announced in a January 21, 2025 memorandum from the Acting Director of OPM, all federal employees in DEI roles will be placed on paid leave by the evening of January 22, 2025.¹⁸

Potential Relevance to the Private Sector:

• The Order directs all agencies and departments to terminate all “equity-related’ grants or contracts as well as “all DEI or DEIA performance requirements for employees, contractors, or grantees.”¹⁹
• The Order further directs the Assistant to the President for Domestic Policy to convene a monthly meeting of the Director of OMB, the Director of OPM, and each deputy agency or department head to “hear reports on the prevalence and the economic and social costs of DEI, DEIA, and ‘environmental justice’ in agency or department programs, activities, policies, regulations, guidance, employment practices, enforcement activities, contracts (including set-asides), grants, consent orders, and litigating positions” and to “monitor and track agency and department progress and identify potential areas for additional Presidential or legislative action to advance the policy of equal dignity and respect.”²⁰

Defending Women from Gender Ideology Extremism and Restoring Biological Truth to the Federal Government (January 20, 2025)

This Order defines the term “sex” as an individual’s “immutable biological classification.” The Order seeks to exclude transgender, nonbinary, and intersex people from receiving certain protections, stating that it is now “the policy of the United States to recognize two sexes, male and female,” and that the “Executive Branch will enforce all sex-protective laws” only in ways that promote that view.²¹

Among other actions, the Order threatens the federal funding of programs that “promote gender ideology,” directs agencies to update relevant guidance documents (including regarding the application of Title IX), and directs the Attorney General to issue guidance on how the Supreme Court’s decision in Bostock v. Clayton County (which held that Title VII protects employees against discrimination due to sexuality or gender identity) applies to federal anti-discrimination laws.²²

Potential Relevance to the Private Sector:

• The Order states that the Attorney General “shall issue guidance to ensure the freedom to express the binary nature of sex and the right to single-sex spaces in workplaces and federally funded entities covered by the Civil Rights Act of 1964.” The Order further instructs the Attorney General, Secretary of Labor, General Counsel and Chair of the Equal Employment Opportunity Commission, and agency heads with enforcement responsibilities under the Civil Rights Act to “prioritize investigations and litigation to enforce the rights and freedoms identified.”²³
• The Order further instructs each agency head, within 120 days of the Order, to submit an update on implementation to the President, including to address “agency-imposed requirements on federally funded entities, including contractors, to achieve the policy of this order.”²⁴

Reforming the Federal Hiring Process and Restoring Merit to Government Service (January 20, 2025)

As part of several changes to the federal hiring process, this Order seeks to eliminate consideration of DEI in federal hiring broadly and to “prevent the hiring of individuals who are unwilling to defend the Constitution or to faithfully serve the Executive Branch.”²⁵

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WilmerHale’s Anti-Discrimination Practice and Labor and Employment Practice are closely monitoring the Trump Administration’s Executive Orders and are available to provide guidance as the landscape continues to evolve.