On Jan. 21, 2025, President Donald Trump issued an executive order (EO) titled Ending Illegal Discrimination and Restoring Merit-Based Opportunity. The EO aims to combat illegal diversity, equity and inclusion (DEI) programs in both the federal and private sectors.

Overview of the Trump EO

Agency Actions to Combat Illegal DEI

The Trump EO orders all federal agencies to combat illegal private-sector DEI preferences, mandates, policies, programs and activities. The EO does not define “illegal DEI” but indicates that illegal DEI programs are those that violate civil rights laws protecting individuals from discrimination based on federally protected traits (including race, color, religion, sex or national origin). However, the EO does not affect employment preferences for veterans.

Attorney General Report

The Trump EO further orders the U.S. attorney general to consult with the heads of all relevant federal agencies within 120 days (i.e., by May 21, 2025) and submit a report recommending measures to combat illegal private-sector DEI. The report must identify key areas of concern and a strategic enforcement plan, including potential litigation or regulatory action. The Trump administration will use this report to establish new policies against corporate DEI programs.

Notably, as part of the report, each federal agency must identify up to nine potential civil compliance investigations of publicly traded corporations, large nonprofit corporations, 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.

Federal Contractors and Subcontractors

The EO also revokes a number of EOs, including EO 11246, which imposes affirmative action obligations on federal contractors and subcontractors by requiring contractors to analyze workforce data and measure equal employment opportunities for women and minorities. The Trump EO requires the elimination of such affirmative action programs by April 21, 2025. It also bans the Office of Federal Contract Compliance Programs (OFCCP) from promoting diversity or encouraging contractors to engage in “workforce balancing” based on race, color, sex, sexual preference, religion or national origin.

The EO does not eliminate affirmative action requirements for veterans and individuals with disabilities.

Employer Takeaways

While the EO does not alter existing law (which has always banned consideration of an individual’s protected trait in employment decisions), it signals the new administration’s focus on combating illegal DEI programs. Employers should review existing DEI practices to ensure that such practices do not discriminate on the basis of a federally protected class. Employers should also watch for the attorney general’s report to be submitted in late May 2025 for additional guidance on how the government will combat illegal DEI. Further, employers who are federal contractors or subcontractors should ensure that they eliminate noncompliant affirmative action programs by April 21, 2025.

Finally, employers may also anticipate uncertainty, as future enforcement guidance is likely to face legal challenges. Employers should continue to monitor for updates as this issue evolves.

This Bulletin is not intended to be exhaustive nor should any discussion or opinions be construed as legal advice. Readers should contact legal counsel for legal advice. Design ©2025 Zywave, Inc. All rights reserved.