In late January, the president signed an executive order significantly changing workplace diversity and inclusion programs for federal contractors. The order eliminates requirements for some businesses to maintain affirmative action plans and diversity initiatives.
The order directs companies working with the federal government to focus solely on merit-based hiring and promotions. These changes affect how organizations approach workplace diversity, equity and inclusion (DEI) programs.
The order has created uncertainty for both employees and companies. Here is what you need to know about whether these changes might affect your workplace:
Which employers does the order affect?
The executive order targets federal contractors, and other companies doing business with the federal government. It requires these entities to eliminate DEI programs that focus on race, gender or other identity-based preferences.
Organizations must certify they are not running such programs and have shifted to merit-based hiring and promotion practices within 90 days.
Does the order give these employers the right to discriminate?
No, the executive order eliminates mandatory DEI programs and affirmative action requirements for federal contractors. However, all employers must still comply with long-standing anti-discrimination laws, including Title VII of the Civil Rights Act, and state and local anti-discrimination laws.
Discrimination based on race, color, religion, sex, national origin, age, disability, and other protected characteristics remains illegal.
Does the order change the rules for private companies?
No, the executive order does not change the rules for private companies that do not contract with the federal government. Private employers who do not receive federal contracts can voluntarily continue their existing DEI programs and initiatives, but may be subject to legal challenges by groups opposed to affirmative action programs.
They remain subject to the same anti-discrimination laws and regulations that were in place before the executive order. Companies must ensure their programs comply with both federal and state laws and regulations.
What does “merit-based hiring” mean under the order?
Merit-based hiring emphasizes qualifications and performance but does not permit discrimination. Employers must still ensure fair hiring and promotion practices while focusing on job-related criteria.
Ideally, the shift to merit-based systems should not result in discriminatory impacts on protected groups, but may result in reduced representation of protected groups in the hiring pool. Employees and job applicants should report any practices that appear discriminatory.
Do Maryland, Virginia and Washington, D.C. employment laws still protect workers from discriminatory practices?
Yes, our region’s robust state and local laws vigorously protect employees. The executive order does not diminish these protections, often providing stronger safeguards than federal law. Workers who experience discrimination should document all incidents, including dates, witnesses and details.
Follow your company’s internal complaint procedures. File timely complaints with the appropriate state agencies and/or the Equal Employment Opportunity Commission (EEOC). Consider consulting an employment lawyer to understand your options and protect your rights.
Lastly, what should you know about executive orders?
Executive orders are directives issued to federal agencies and government officials, not laws passed by Congress. They can be reversed by future presidents with a new executive order, making them less permanent than legislation. Executive orders must operate within existing law and the Constitution and cannot override federal statutes or constitutional provisions.
These orders primarily affect federal operations and federal contractors, not private businesses or state governments, unless tied to federal funding or contracts. Courts can review and strike down executive orders if they exceed presidential authority or conflict with existing laws. There is already at least one lawsuit filed in federal court in Maryland, challenging the DEI executive orders. As a result, these changes may be temporary and subject to modification by future administrations or legal challenges.
