Remind me, what's an executive order?

Executive orders are directives ordered by the president of the United States that direct government companies and authorities to take specific actions. While they are not laws, they have the force of law and impact how existing laws are carried out or implemented.

Executive orders impact the agencies of the executive branch and therefore do not require the approval of Congress. They must be within the president's constitutional authority and might be challenged in court if considered unconstitutional.

Executive orders might be rescinded, reversed by future presidents, or challenged in court, and enforcement top priorities can change during any administration.

The brand-new administration's actions have significant impacts beyond executive orders. For more on mitigating danger, international businesses can take brand-new chances by remaining nimble.

Implications of the executive orders for DEI efforts and work in private-sector companies

On Jan. 21, President Trump issued "Ending Illegal Discrimination and Restoring Merit-Based Opportunity," which reverses numerous previous executive orders and memoranda, consisting of Executive Order 11246 (EO 11246) signed in 1965 by President Lyndon B. Johnson.

EO 11246 needed every federal government contract to include a statement that the contractor will not victimize any employee or applicant for work based on race, creed, color, or nationwide origin.

Despite President Trump's new executive order, the underlying federal anti-discrimination law stays unchanged for private-sector workers.

However, the executive order signals that there may be changing enforcement top priorities in the brand-new administration. The order directs all federal firms to "combat unlawful private-sector DEI choices, requireds, policies, programs, and activities."

In December 2024, employment President-elect Trump tapped Harmeet K. Dhillon to lead the Justice Department's civil liberties office, indicating his record of "taking legal action against corporations who use 'woke' policies to discriminate versus their employees."

In addition to withdrawing EO 11246, the Jan. 21 executive order advises each firm of the federal government to determine "up to 9 potential civic compliance investigations" of economic sector entities within 120 days of the order - by May 21, 2025.

The personal sector entities based on these investigations consist of publicly traded corporations, large nonprofits - consisting of bar associations - big foundations, and universities whose endowments go beyond US$ 1 billion.

Organizations that may be targeted should ask:

- What is my company's threat tolerance?

- How will employees react to the company's actions?

- How will customers and stakeholders react?


What internal counsel ought to consider:

Assess any federal contracts and grants

- Determine if they contain any terms or conditions related to DEI that might contravene existing laws and regulations


Review your organization's existing DEI policies to understand your risk

- Prepare for increased scrutiny and possible civil compliance examinations


Document, file, document

- Hiring and recruitment procedures

- Performance assessments and promo choices

- Training materials and presence records

- Any changes to DEI policies


Implications for federal contractors

To name a few steps, the Jan. 21 Executive Order needs the heads of federal companies to consist of particular terms in every agreement or grant award:

- "A term requiring the legal counterparty or grant recipient to concur that its compliance in all aspects with all suitable Federal anti-discrimination laws is product to the government's payment decisions for functions of section 3729( b)( 4) of title 31, United States Code"; and

- "A term needing such counterparty or recipient to accredit that it does not run any programs promoting DEI that breach any suitable Federal anti-discrimination laws."


Section 3729 of title 31 of the United States Code is an arrangement of the US False Claims Act, a federal law that imposes civil charges on those who make false claims to the government in order to affect the payment or receipt of money or home.

The certification requirement brings a possible threat of litigation for federal specialists under the False Claims Act. In-house lawyers at federal professionals thus have a specific interest in ensuring their organization's policies, procedures, practices, interactions and content, are reviewed. Assess if changes are required to alleviate the danger of lawsuits.

Executive orders targeting prohibited immigration

President Trump's preliminary flurry of executive orders included many - such as the Jan. 20 executive order "Protecting the American People Against Invasion" - targeted at limiting prohibited immigration and deporting illegal immigrants. The orders call for enforcement actions by federal companies versus prohibited immigration.

In-house legal representatives need to think about reviewing their company's employment eligibility verification process. They might also want to consider whether the organization is prepared for reacting to an I-9 audit or a worksite enforcement action (or raid) by migration enforcement agencies.

Sectors that might be especially impacted include agriculture, hospitality, and other markets such as building. From 2020-2022, 42 percent of crop farmworkers held no work authorization, according to the US Department of Agriculture. The American Immigration Council approximates that more than one million undocumented immigrants work in hospitality, representing 7.1 percent of the labor force.

In-house counsel have a crucial function to play in establishing and guaranteeing constant application of the Form I-9 and E-Verify regulations the federal government utilizes to execute and enforce migration law, shares John W. Mazzeo, AGC, director of I-9 and E-Verify compliance for Vertical Screen, Inc., in a 2024 ACC Docket post.

Have a look at useful lists of considerations relevant for in-house legal representatives on the topic of I-9 audits and worksite enforcement actions.

If an employer does not cooperate with a civil administrative warrant provided by US Immigration and Customs Enforcement (ICE), there is a danger that the agency might start an I-9 audit if they felt a company was obstructing their requirement to detain a non-citizen employee, or employment in some cases acquire a criminal warrant from a judge if actions support it.

Steps in-house counsel should think about:

- Determine how lots of employees could possibly be impacted

- Review your organization's work eligibility verification procedure

- Ensure your company's process is recorded and defensible

- Implement and implement clear policies

- Monitor legal advancements, consisting of litigation and enforcement guidance


Mitigate risk, remain nimble, and seize new chances

The current executive orders will significantly impact international services. Legal departments and internal counsel will need to help their companies understand and adapt to changes, making sure compliance or litigating when appropriate.

Many of the brand-new administration's decisions will play out over the coming months, including new executive orders and legal challenges. The Docket will continue to monitor developments. Global in-house legal representatives should get ready for rapid developments associated with:

Trade and tariffs. On Feb. 1, President Trump ordered the imposition of a 25-percent tariff on imports from Canada and Mexico, and 10-percent extra tariffs on imports from China. The former 2 were both postponed by a month as the administration participates in negotiations. Meanwhile, China has actually started its own vindictive procedures on US goods. He had previously announced his intent to enforce 25-percent intensifying tariffs on Colombia (an action that was ultimately not taken).


Technology and copyright. Among the president's first actions was to rescind the previous administration's AI executive order. The brand-new administration likewise extended a grace duration for TikTok's upcoming restriction, sending out waves throughout the innovation sector, both in the United States and abroad.


Energy, climate, and health. The president also withdrew the United States from the Paris Climate Agreement and the World Health Organization, putting an early emphasis on American energy self-reliance and away from the previous administration's international sustainability efforts.


Steps internal counsel should consider:

- Assess the effect of possible tariff boosts on supply chain and company connection.

- Assess the company's dependence on social media platforms, such as for marketing purposes, and the prospective needs to backup social networks data and possessions in the event their preferred platform ceases to be available.

- Consider how developments in the new administration's method to ecological, sustainability and governance problems may affect the company's ESG strategy.


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