President Donald Trump signed a number of executive orders in his first week in office with broad implications for federal agencies, contractors and, potentially, private employers. Executive orders only apply to federal agencies and their employees and do not impose requirements on private employers. But private employers should be aware of these issues and prepare for potential impacts on their organizations.
Order on Gender Identity and Expression
Trump signed an executive order Jan. 20, titled “Defending Women From Gender Ideology Extremism and Restoring Biological Truth to the Federal Government” (Order 14168), declaring “[i]t is the policy of the United States to recognize two sexes, male and female.” This sweeping directive institutionalizes the recognition of biological distinctions between men and women in federal policies, documents and practices.
Order 14168 states that the “erasure of sex in language and policy has a corrosive impact not just on women but on the validity of the entire American system” and that the “administration will defend women’s rights and protect freedom of conscience by using clear and accurate language and policies that recognize women are biologically female, and men are biologically male.” It challenges what the administration describes as “gender ideology,” which it claims erodes the distinction between sexes, undermining laws and policies designed to protect women. The administration emphasizes that basing federal policy on “immutable biological reality” is vital to scientific integrity, public trust and the preservation of sex-based rights.
Under Order 14168, federal policies will adhere to definitions of “male” and “female” based on biological reproductive roles determined at conception and will reject the concept of “gender identity.” In addition to recognizing only two sexes, Order 14168 directs federal agencies and employees acting in an official federal capacity use the term “sex,” not “gender,” and take other actions to effectuate the Order 14168’s two-sex only policy.
The definitions in Order 14168 will be proposed to Congress, which if passed, could supersede state definitions that are more inclusive and could also mitigate the impact of Bostock v. Clayton County[1]. Order 14168 also addresses “privacy” in intimate spaces in prisons and shelters and directs that agencies take appropriate action to ensure that intimate spaces designated for women, girls or females (or for men, boys or males) are designated by sex and not identity.
Order 14168 further directs the attorney general to issue guidance to ensure the “freedom to express the binary nature of sex and the right to single-sex spaces in workplaces and federally funded entities covered by the Civil Rights Act of 1964” and directs the revocation of all previous Biden administration executive orders and agency guidance addressing gender identity, including EEOC guidance on harassment in the workplace.[2] The Supreme Court specifically declined to address bathroom and locker rooms in Bostock, so legal challenges on that issue seem almost certain. Order 14168 could also create a conflict with state laws that specifically protect sexual orientation, gender identity and gender expression, some of which specifically address individuals’ ability to use a bathroom or locker room that conforms to their gender identity.
While the order only applies to federal agencies and their employees, private employers should anticipate the possibility of a shift in federal employment law away from protection of gender identity and expression. Issues such as transitioning employees, restroom access, dress codes and use of preferred names and pronouns may become more complex in the future, and current employer policies that protect gender identity and expression seem likely to become targets.
Order on DEI and Affirmative Action Requirements
Trump also signed an executive order Jan. 21 revoking 60-year-old Executive Order 11246, which imposed affirmative action and non-discrimination obligations on federal contractors. Titled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” the order focuses on ending what it describes as “discriminatory and illegal preferences” in both the federal government and the private sector, specifically targeting Diversity, Equity and Inclusion (DEI) programs.
The order directs executive departments and agencies to terminate all “discriminatory and illegal preferences, mandates, policies, programs, activities, guidance, regulations, enforcement actions, consent orders, and requirements” and to enforce “longstanding civil-rights laws and to combat illegal private-sector DEI preferences, mandates, policies, programs, and activities.” Agency heads must submit by May 21 a strategic enforcement plan that identifies:
- Key sectors of concern within each agency’s jurisdiction;
- The “most egregious and discriminatory DEI practitioners” in each sector;
- Specific steps or measures to deter DEI initiatives (whether or not expressly denominated as DEI);
- Up to nine targets for potential civil compliance investigations focusing on
- Publicly traded corporations,
- Large nonprofit corporations or associations,
- State and local bar and medical associations,
- Foundations with assets of $500 million or more and
- Higher education institutions with endowments over $1 billion;
- Strategies to encourage the end of private sector DEI initiatives;
- Potential litigation; and
- Potential regulatory action and sub-regulatory guidance.
The order also directs the Office of Federal Contract Compliance Programs within the Department of Labor (OFCCP) to immediately cease:
- promoting diversity
- holding federal contractors responsible for taking “affirmative action” and
- allowing or encouraging federal contractors to engage in workforce balancing based on race, color, sex, sexual preference, religion or national origin.
As a result of these directives, federal contractors no longer must comply with affirmative action plan requirements regarding race and gender. Further, federal contractors and grant recipients will be required to certify that they do not operate any programs promoting DEI that the order considers violative of applicable federal anti-discrimination laws. Importantly, compliance with all applicable federal anti-discrimination laws will be determined to be material to the government’s payment decisions, leaving contractors open to False Claims Act liability for noncompliance.
The order also mandates guidance for educational institutions receiving federal funding, as well as those participating in federal student loan programs, to ensure compliance with the Supreme Court’s 2023 decision in Students for Fair Admissions, Inc. v. President and Fellows of Harvard College. Exemptions include preferences for veterans and the U.S. armed forces and blind individuals under the Randolph-Sheppard Act. The order also preserves First Amendment rights, including the right to discuss and teach about programs deemed unlawful under the order. Statutory affirmative action and non-discrimination obligations under the Rehabilitation Act and the Vietnam Era Veterans' Readjustment Assistance Act (VEVRAA) remain unaffected.
Practical Considerations
The full scope and impact of the orders is evolving, and challenges in court are possible. Still, employers and federal contractors can, among other things:
- Prepare to address employee concerns regarding issues surrounding gender identity and expression and DEI.
- Review policies and practices with respect to gender-identity or gender-expression harassment, misgendering, restroom and locker room access, gender transitions and religious accommodations requests to identify areas of risk.
- Stay aware of state and local anti-discrimination laws requirements related to gender identity and expression.
- Anticipate increased government investigations and oversight regarding DEI-related matters.
- Continue to prepare VEVRAA and Section 503 Affirmative Action plans (contractors only).
- Review contracts for new DEI and anti-discrimination related obligations (contractors only).
- Review and audit employment practices and DEI initiatives for compliance with federal nondiscrimination laws (and stay aware of potentially changing interpretations of what actions may violate federal nondiscrimination law);
- Review and audit admission criteria and selection guidelines/processes for compliance with Students for Fair Admissions (educational institutions receiving federal funding only);
Miles & Stockbridge’s labor and employment lawyers will continue to monitor the fallout from these executive orders and any future ones.
Opinions and conclusions in this post are solely those of the author unless otherwise indicated. The information contained in this blog is general in nature and is not offered and cannot be considered as legal advice for any particular situation. The author has provided the links referenced above for information purposes only and by doing so, does not adopt or incorporate the contents. Any federal tax advice provided in this communication is not intended or written by the author to be used, and cannot be used by the recipient, for the purpose of avoiding penalties which may be imposed on the recipient by the IRS. Please contact the author if you would like to receive written advice in a format which complies with IRS rules and may be relied upon to avoid penalties.
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