Listen to the article
Trump Executive Order Targets DEI Programs in Federal Contracting
President Donald Trump has issued a sweeping executive order that aims to eliminate diversity, equity, and inclusion (DEI) programs across the federal government and among federal contractors. The order, titled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” was signed on January 21, 2025, and marks a significant shift in federal contracting requirements that date back nearly 60 years.
The executive order revokes Executive Order 11246, which since 1965 has required federal contractors and subcontractors to implement affirmative action programs to ensure equal employment opportunity. Federal contractors have been given a 90-day grace period—until April 21, 2025—to continue complying with the previous regulatory framework.
In a significant departure from decades of federal policy, the order declares that “race- and sex-based preferences under the guise of so-called ‘diversity, equity, and inclusion'” may violate civil rights laws. It further states 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.”
The Office of Federal Contract Compliance Programs, housed within the Labor Department, has been directed to “immediately cease” allowing or encouraging federal contractors to engage in “workforce balancing” based on characteristics such as race, color, sex, or national origin. The lack of a clear definition for “workforce balancing” may create uncertainty for contractors attempting to navigate compliance.
Perhaps most significantly, the order imposes new certification requirements that could dramatically increase legal exposure for federal contractors and grant recipients under the False Claims Act (FCA). Companies must now certify that their “compliance in all respects with all applicable Federal anti-discrimination laws is material to the government’s payment decisions” and that they do not “operate any programs promoting DEI that violate any applicable Federal anti-discrimination laws.”
The FCA, which allows for treble damages and substantial civil penalties for companies that knowingly submit false claims to the government, recovered over $2.9 billion in settlements and judgments in fiscal year 2024 alone. Current penalties range from $13,946 to $27,894 per false claim, creating potentially enormous liability for companies that regularly bill the government.
Legal experts note that the order appears designed to leverage the FCA’s powerful enforcement mechanisms as part of a broader effort to eliminate DEI programs within major corporations, financial institutions, healthcare organizations, commercial airlines, law enforcement agencies, and higher education institutions.
The certification requirements create particular challenges because they involve areas of law where interpretations are contested and evolving. Companies with DEI initiatives will need to carefully monitor forthcoming agency regulations and judicial decisions to determine what programs remain permissible under federal civil rights laws.
The order also increases the risk of whistleblower lawsuits filed by employees opposed to DEI initiatives. Under the FCA’s qui tam provisions, private whistleblowers can file actions on behalf of the government in exchange for 15-30% of any recovery. Of the $2.9 billion in FCA settlements and judgments in 2024, more than $2.4 billion came from such qui tam actions, with over $400 million going directly to the whistleblowers themselves.
The U.S. Attorney General has been directed to produce a report by May 21, 2025, regarding enforcement of federal civil rights laws, which may include specific recommendations for how the Department of Justice should enforce compliance with these requirements.
Companies doing business with the federal government now face the complex challenge of balancing their existing DEI commitments against potential legal exposure under the FCA. The broad venue provisions of the FCA, which allow cases to be filed in any judicial district where a defendant conducts business, may also expose nationwide companies to lawsuits in jurisdictions most favorable to the administration’s interpretation of civil rights laws.
As the legal landscape continues to shift, federal contractors and grant recipients will need to carefully review their DEI initiatives and compliance programs to navigate the heightened risks posed by this dramatic policy reversal.
Verify This Yourself
Use these professional tools to fact-check and investigate claims independently
Reverse Image Search
Check if this image has been used elsewhere or in different contexts
Ask Our AI About This Claim
Get instant answers with web-powered AI analysis
Related Fact-Checks
See what other fact-checkers have said about similar claims
Want More Verification Tools?
Access our full suite of professional disinformation monitoring and investigation tools
11 Comments
This executive order appears to be part of a broader effort to roll back diversity and inclusion programs. The impact on the mining, metals, and energy sectors remains to be seen.
This is a concerning development for federal contractors. DEI programs have become an important part of many companies’ operations. I wonder how this will impact hiring, training, and workplace culture going forward.
The administration seems to be taking a hardline stance against affirmative action. It will be interesting to see how the courts respond to this executive order.
The move to revoke Executive Order 11246 is a dramatic shift in federal contracting policy. DEI initiatives have become widely adopted, so this order could face significant legal challenges.
It’s unclear how this will play out. Federal contractors will need to closely monitor developments and adapt their practices accordingly.
This executive order represents a major change in the federal government’s approach to diversity and inclusion in contracting. It’s sure to be a topic of debate and litigation in the years ahead.
This is a controversial move that could face legal challenges. The impact on federal contractors, especially in the mining and energy industries, remains to be seen.
The Biden administration’s expansion of the False Claims Act to target DEI programs in federal contracting is a significant policy shift. It could have far-reaching implications for how companies approach these initiatives.
This is a complex issue with valid arguments on both sides. It will be crucial for federal contractors to stay informed and compliant as the situation evolves.
The potential liability under the False Claims Act is a significant concern for federal contractors. Companies will need to carefully review their DEI programs to ensure compliance with the new order.
This is a high-stakes issue that could have far-reaching consequences for the mining, metals, and energy sectors. Vigilance will be key for affected companies.