President Trump issued a multitude of executive orders since taking office in January. Executive orders (EO) can, and often do, have significant impacts on employers since they establish or modify policies and regulations that affect business operations. It’s important for employers to be proactive in understanding any EO that may affect their business, even if the scope of the potential impact is unknown.
Overview of Executive Orders that May Affect Employers
Executive Order 14168 – Defending Women from Gender Ideology Extremism and Restoring the Biological Truth to the Government
This EO identifies only two sexes, male and female, as being recognized by the federal government. It’s stated purpose is to “defend women’s rights” with policies that recognize gender as binary.
Executive Order 14173 – Ending Illegal Discrimination and Restoring Merit-Based Opportunity
The main focus of this EO is to reverse discriminatory employment practices and policies in an effort to restore merit-based opportunities for all individuals regardless of their race, color, religion, sex, or national origin.
Federal Agencies Impacted by Executive Orders
EOs 14168 and 14173 apply to federal agencies and their employees, in particular the U.S Equal Employment Opportunity Commission and the Office of Federal Contract Compliance Programs. Both of these federal agencies play important roles in preventing discrimination in the workplace.
U.S. Equal Employment Opportunity Commission (EEOC)
The EEOC is responsible for enforcing federal laws that make it illegal to discriminate against a job applicant or an employee in a protected class.
In 1965, President Lyndon Johnson’s Executive Order 11246 “Equal Employment Opportunity” prohibited employment discrimination by federal contractors and instituted affirmative action to ensure equal employment opportunity. President Trump’s new EO revokes this and bans federal contractors and subcontractors from considering race, color, sex, sexual preference, religion, or national origin in their employment, procurement or contracting practices.
Informing employees of prohibited employment discrimination of a protected class is accomplished via the EEOC’s “Know Your Rights: Workplace Discrimination is Illegal” poster. Sex, including pregnancy and related conditions, sexual orientation, or transgender status, is currently listed as a protected class.
Office of Federal Contract Compliance Programs (OFCCP)
The OFCCP is responsible for ensuring employers doing business with the federal government comply with nondiscrimination laws and regulations. Two equal employment opportunity laws, the Rehabilitation Act of 1973 and the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, are enforced by the OFCCP. Under these laws, it is illegal for federal contractors and subcontractors to discriminate in employment practices based on a disability or status as a protected veteran. According to the OFCCP, both laws are “statutory and remain in effect” despite the revocation of EO 11246.
Also, under the purview of the OCCP, the “Pay Transparency Non-Discrimination Notice” informs workers that federal contractors and subcontractors are prohibited from terminating or discriminating against an employee because that employee discussed, disclosed, or inquired about his/her own compensation or a co-worker’s compensation. This protection extends to job applicants who make compensation-related inquiries, discussions and/or disclosures.
The full impact on either of these federal agencies and subsequently federal contractors under the new EOs are still being evaluated.
Affected Workplace Compliance Posters
- “Know Your Rights: Workplace Discrimination is Illegal” Poster: The EEOC confirms this poster is currently under revision. Though no official details have been released regarding changes to the poster, verbiage related to gender identity and expression is expected be removed in accordance with EO 14168.
- “Pay Transparency Non-Discrimination” Poster: This poster has been removed from the OFCCP website indicating it’s no longer required.
Employers must keep in mind the possibility of more labor law posters being revised after full consideration of these new EOs.
Employer Compliance Timeline
- There is currently a 90-day transition period, expected between January 20, 2025, to April 19, 2025, for federal contractors to comply with EO 14168. During this period, employers may continue and complete any ongoing DEI (Diversity, Equity, and Inclusion) investigations, policies, and schemes.
- Federal contractor affirmative action plan obligations regarding race and gender, previously required by EO 11246, and enforcement activity by the OFCCP has been eliminated.
- According to the OFCCP Help Desk, details about the impact of these EOs are still unclear. They are restricted from providing specific information at this time, but this was assessed in the discussion:
- The OFCCP will “no longer accept complaints or initiate new investigations” after April 19, 2025.
- The Pay Transparency Notice would be officially rescinded, and businesses will have to remove the poster.
- Employers are not required to remove existing posters at this time.
Anticipated Changes to Workplace Compliance Posters
Although no official announcements have been made, it’s suspected that affected labor law posters will remove gender identity and gender expression as protected classes, and potentially eliminate other protections all together. The full scope of the changes is unknown; so, it’s critical to stay informed of updates.
What Can Employers Do Now?
Federal contractors should review any new government contracts for relevant EEO or DEI terminology. All employers should be aware that these EOs do not change federal laws relating to employment discrimination. Rather, they indicate heightened investigation and enforcement activities relating to programs that use discriminatory preferences. In fact, EO 14173 contains language encouraging “the private sector to end illegal discrimination and preferences, including DEI.”
Employers should consider taking the following steps:
- Review existing DEI initiatives to ensure compliance with federal anti-discrimination laws and assess potential legal risks;
- Consider how DEI efforts are described on company websites and in employment practices;
- Examine hiring, promotion, and compensation practices to assess compliance with the new orders and focus on merit-based employment actions;
- Since merit-based practices do not necessarily guarantee anti-discrimination, consider analytics to monitor policies/practices to prevent potential discrimination;
- Federal contractors must be able to certify compliance with anti-discrimination laws; and
- Stay tuned for more information.
These new executive orders signal a significant shift in federal policy. All employers must remain diligent in ensuring compliance with federal laws while navigating the impacts of the new orders. Additional guidance and modifications to employment policies and procedures as well as mandated workplace posters is expected in the coming weeks. LaborLawCenter is monitoring developments and will provide ongoing updates and recommendations.
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