On January 21, 2025, President Donald Trump made headlines once more by signing an executive order entitled, “Ending Illegal Discrimination and Restoring Merit-Based Opportunity.” With this move, the Trump administration initiated significant changes affecting diversity, equity, and inclusion (DEI) programs across federal agencies and mandatory requirements for federal contractors.
The executive order, which denounces the adoption of race- and sex-based preferences under the guise of DEI, requires all executive departments and agencies to terminate any discriminatory programs, mandates, or policies. Trump’s administration has long shown discontent with DEI frameworks, leading to this sweeping directive.
“Critical and influential institutions of American society… have adopted… dangerous, demeaning, and immoral race- and sex-based preferences under the guise of so-called ‘diversity, equity, and inclusion’,” Trump stated, highlighting the rationale behind his recent actions. The order instructs all federal agencies to enforce civil rights laws strictly and combat any illegal private-sector DEI preferences.
This executive action also resulted in the revocation of decades-old Executive Order 11246, which had previously outlined obligations for federal contractors to develop affirmative action plans aimed at increasing workplace diversity. Signed by President Lyndon B. Johnson nearly 60 years ago, EO 11246 required contractors to set measurable goals for hiring women and minorities and to take proactive steps to facilitate these objectives.
By rescinding this order, the Trump administration diminishes the authority and effectiveness of the Office of Federal Contractor Compliance Programs (OFCCP). This agency, which has worked diligently to enforce affirmative action and anti-discrimination mandates, now faces serious limitations. Prior to the rescission, the OFCCP was involved in analyzing contractor employment data and conducting audits to identify bias.
Under the Trump administration’s new directive, the DOL will cease its audits and investigations related to EO 11246, fundamentally altering the contractor oversight framework. This change raises numerous questions about the future of anti-discrimination practices within federal contracting. With approximately 2,000 contractors previously slated for OFCCP evaluations this fiscal year, they are granted temporary reprieve—at least until April 21, 2025, when contractors are required to wind down their affirmative action plans.
Further compliciting the situation is the ambiguity surrounding the long-term function of the OFCCP itself. Since Trump’s executive order gives it limited power, there is uncertainty whether the agency will continue to enforce obligations related to veterans and individuals with disabilities—requirements under the Rehabilitation Act and the Vietnam Era Veterans' Readjustment Assistance Act, respectively.
The ramifications of these changes extend beyond the contractor community. Trump's executive order encourages private companies to review and potentially dismantle their own DEI initiatives, framing them as illegal preferences. The order's accompanying memo directs agency heads to draft reports identifying civil compliance investigations targeting what the administration considers egregious DEI practitioners among large corporations and nonprofits.
Meanwhile, the OFCCP's recent successes and its history of securing over $260 million for 250,900 employees facing discrimination serve as stark reminders of the agency's previous role. The shift away from enforcement may embolden some contractors to neglect the remaining civil rights laws and internal audits, leading to an increased risk of discriminatory practices remaining unchecked.
Companies are encouraged to proactively maintain compliance with civil rights laws, even though the legal ramifications of their affirmative action initiatives now appear less certain. While Trump’s administration has opened the door for potentially increased scrutiny, contractors risk alienation from public sentiment—especially if they abandon DEI altogether.
The shifting priorities within the federal government reflect not only the political climate but also the significant changes expected to influence the working environments of many Americans. Workers and advocates who previously relied on the OFCCP for governmental support against discrimination are now faced with the challenge of advocating for their rights independently.
Contractors must act with urgency, reviewing their own policies to navigate the altered regulatory climate sensitively. Failing to adapt could result not only in legal repercussions but also detrimental impacts on workplace culture, employee morale, and recruitment efforts.
Trump's executive orders signal the start of a new era for federal contractor oversight. The complete ramifications of these actions remain to be fully understood, but they mark a historically significant pivot away from affirmative action and DEI initiatives and toward the reinstatement of merit-based evaluations, as delineated by the administration.