Remind me, what's an executive order?

Executive orders are directives bought by the president of the United States that direct government agencies and officials to take specific actions. While they are not laws, they have the force of law and effect how existing laws are carried out or imposed.

Executive orders affect the companies of the executive branch and for that reason do not require the approval of Congress. They need to be within the president's constitutional authority and may be challenged in court if deemed unconstitutional.

Executive orders may be rescinded, reversed by future presidents, or challenged in court, and enforcement priorities can change throughout any administration.

The brand-new administration's actions have significant effects beyond executive orders. For more on mitigating danger, global services can take brand-new opportunities by staying 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 different previous executive orders and memoranda, including Executive Order 11246 (EO 11246) checked in 1965 by President Lyndon B. Johnson.

EO 11246 required every federal government agreement to include a statement that the professional will not discriminate against any staff member or applicant for employment based upon race, creed, color, or national origin.

Despite President Trump's brand-new executive order, the underlying federal anti-discrimination law remains the same for private-sector staff members.

However, the executive order signals that there may be altering enforcement priorities in the new administration. The order directs all federal companies to "combat illegal private-sector DEI choices, mandates, policies, programs, and activities."

In December 2024, President-elect Trump tapped Harmeet K. Dhillon to lead the Justice Department's civil rights workplace, pointing to his record of "suing corporations who use 'woke' policies to discriminate against their employees."

In addition to revoking EO 11246, the Jan. 21 executive order instructs each firm of the federal government to identify "up to nine possible civic compliance investigations" of private sector entities within 120 days of the order - by May 21, 2025.

The private sector entities subject to these investigations include publicly traded corporations, large nonprofits - consisting of bar associations - big structures, and universities whose endowments exceed US$ 1 billion.

Organizations that may be targeted should ask:

- What is my organization's risk tolerance?
- How will staff members respond to the business's actions?
- How will customers and stakeholders respond?
What in-house counsel should consider:

Assess any federal contracts and grants

- Determine if they include any terms or associated with DEI that might contravene current laws and regulations
Review your company's existing DEI policies to understand your risk

- Get ready for increased examination and possible civil compliance investigations
Document, file, file

- Hiring and recruitment processes
- Performance assessments and promo choices
- Training materials and presence records
- Any changes to DEI policies
Implications for federal contractors

Among other steps, the Jan. 21 Executive Order requires the heads of federal firms to consist of particular terms in every contract or grant award:

- "A term needing the contractual counterparty or grant recipient to agree that its compliance in all respects with all appropriate Federal anti-discrimination laws is material to the government's payment choices for purposes of section 3729( b)( 4) of title 31, United States Code"; and
- "A term requiring such counterparty or recipient to certify that it does not run any programs promoting DEI that break any relevant Federal anti-discrimination laws."
Section 3729 of title 31 of the United States Code is a provision of the US False Claims Act, a federal law that enforces civil charges on those who make false claims to the government in order to affect the payment or invoice of cash or residential or commercial property.

The certification requirement brings a potential danger of lawsuits for federal contractors under the False Claims Act. In-house attorneys at federal specialists hence have a specific interest in guaranteeing their company's policies, treatments, practices, interactions and material, are evaluated. Assess if adjustments are needed to reduce the danger of litigation.

Executive orders targeting prohibited immigration

President Trump's initial flurry of executive orders included numerous - such as the Jan. 20 executive order "Protecting the American People Against Invasion" - targeted at limiting unlawful migration and deporting illegal immigrants. The orders require enforcement actions by federal firms against illegal migration.

In-house legal representatives must think about examining their organization's employment eligibility confirmation process. They may also desire to consider whether the organization is prepared for reacting to an I-9 audit or a worksite enforcement action (or raid) by immigration enforcement companies.

Sectors that might be particularly affected consist of farming, hospitality, and other markets such as building. From 2020-2022, 42 percent of crop farmworkers held no work permission, according to the US Department of Agriculture. The American Immigration Council estimates that more than one million undocumented immigrants operate in hospitality, representing 7.1 percent of the workforce.

In-house counsel have a crucial function to play in developing and making sure constant application of the Form I-9 and E-Verify policies the federal government utilizes to execute and impose migration law, shares John W. Mazzeo, AGC, director of I-9 and E-Verify compliance for Vertical Screen, Inc., in a 2024 ACC Docket short article.

Check out useful checklists of considerations pertinent for internal legal representatives on the subject of I-9 audits and worksite enforcement actions.

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

Steps in-house counsel ought to consider:

- Determine the number of workers might possibly be affected
- Review your company's work eligibility confirmation procedure
- Ensure your organization's process is documented and defensible
- Implement and impose clear policies
- Monitor legal advancements, including litigation and enforcement guidance
Mitigate threat, remain active, and seize new opportunities

The current executive orders will considerably impact worldwide companies. Legal departments and internal counsel will require to help their companies understand and adapt to modifications, guaranteeing compliance or litigating when proper.

Much of the new administration's choices will play out over the coming months, including new executive orders and legal challenges. The Docket will continue to keep track of advancements. Global in-house attorneys must get ready for quick advancements related to:

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 previous 2 were both postponed by a month as the administration participates in settlements. Meanwhile, China has actually started its own retaliatory steps on US products. He had actually formerly announced his intent to impose 25-percent intensifying tariffs on Colombia (an action that was eventually not taken).
Technology and intellectual home. Among the president's very 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, environment, and health. The president likewise withdrew the United States from the Paris Climate Agreement and the World Health Organization, putting an early emphasis on American energy self-reliance and far from the previous administration's worldwide sustainability efforts.
Steps internal counsel ought to think about:

- Assess the impact of possible tariff boosts on supply chain and company connection.
- Assess the organization's dependency on social networks platforms, such as for marketing purposes, and the prospective needs to backup social networks data and assets in case their preferred platform stops to be available.
- Consider how developments in the new administration's approach to ecological, sustainability and governance concerns may affect the organization's ESG strategy.
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