Remind me, what's an executive order?
Executive orders are instructions bought by the president of the United States that direct federal government agencies 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 firms of the executive branch and therefore do not require the approval of Congress. They need to be within the president's constitutional authority and might be challenged in court if deemed unconstitutional.
Executive orders may be rescinded, reversed by future presidents, or challenged in court, and enforcement concerns can alter throughout any administration.
The brand-new administration's actions have far-reaching effects beyond executive orders. For more on mitigating danger, global services can seize brand-new opportunities by remaining active.
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 prior executive orders and memoranda, including Executive Order 11246 (EO 11246) signed in 1965 by President Lyndon B. Johnson.
EO 11246 needed every government contract to include a declaration that the specialist will not discriminate versus any staff member or job candidate for work based upon race, creed, color, or nationwide origin.
Despite President Trump's new executive order, the underlying federal anti-discrimination law stays the same for private-sector employees.
However, the executive order signals that there may be changing enforcement top 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 liberties office, indicating his record of "taking legal action against corporations who use 'woke' policies to victimize their workers."
In addition to revoking EO 11246, the Jan. 21 executive order advises each company of the federal government to identify "as much as nine potential civic compliance examinations" of personal sector entities within 120 days of the order - by May 21, 2025.
The economic sector entities subject to these examinations consist of publicly traded corporations, big nonprofits - including bar associations - large foundations, and universities whose endowments surpass US$ 1 billion.
Organizations that may be targeted should ask:
- What is my company's danger tolerance?
- How will staff members react to the business's actions?
- How will customers and stakeholders react?
What internal counsel needs to consider:
Assess any federal agreements and grants
- Determine if they consist of any terms or to DEI that may clash with current laws and policies
Review your organization's existing DEI policies to comprehend your threat
- Get ready for increased analysis and possible civil compliance examinations
Document, file, file
- Hiring and recruitment procedures
- Performance assessments and promotion decisions
- Training products and attendance records
- Any changes to DEI policies
Implications for federal professionals
To name a few steps, the Jan. 21 Executive Order needs the heads of federal companies to consist of specific terms in every contract or grant award:
- "A term needing the legal counterparty or grant recipient to concur that its compliance in all aspects with all relevant Federal anti-discrimination laws is product to the government's payment decisions for purposes of section 3729( b)( 4) of title 31, United States Code"; and
- "A term requiring such counterparty or recipient to accredit that it does not operate any programs promoting DEI that break any appropriate 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 imposes civil charges on those who make incorrect claims to the federal government in order to affect the payment or invoice of cash or residential or commercial property.
The certification requirement carries a potential threat of litigation for federal professionals under the False Claims Act. In-house legal representatives at federal contractors therefore have a particular interest in guaranteeing their organization's policies, treatments, practices, interactions and material, are examined. Assess if changes are needed to mitigate the risk of litigation.
Executive orders targeting unlawful immigration
President Trump's initial flurry of executive orders included lots of - such as the Jan. 20 executive order "Protecting the American People Against Invasion" - targeted at restricting prohibited migration and deporting prohibited immigrants. The orders require enforcement actions by federal agencies against illegal immigration.
In-house attorneys should consider examining their company's work eligibility confirmation procedure. They may also desire to think about whether the organization is prepared for responding to an I-9 audit or job 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 and construction. From 2020-2022, 42 percent of crop farmworkers held no work permission, 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 an important role to play in developing and making sure constant application of the Form I-9 and E-Verify regulations the federal government uses to carry out and implement 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.
Check out helpful checklists of factors to consider pertinent for in-house legal representatives on the topic of I-9 audits and worksite enforcement actions.
If a company does not work together with a civil administrative warrant presented by US Immigration and Customs Enforcement (ICE), there is a threat that the company could start an I-9 audit if they felt a company was blocking their need to apprehend a non-citizen staff member, or in many cases get a criminal warrant from a judge if actions support it.
Steps in-house counsel should think about:
- Determine the number of staff members might possibly be affected
- Review your company's employment eligibility confirmation process
- Ensure your company's procedure is recorded and defensible
- Implement and impose clear policies
- Monitor legal developments, including lawsuits and enforcement assistance
Mitigate threat, remain nimble, and seize new opportunities
The recent executive orders will significantly affect international companies. Legal departments and in-house counsel will need to help their companies comprehend and adapt to modifications, guaranteeing compliance or litigating when suitable.
A lot of the brand-new administration's decisions will play out over the coming months, consisting of new executive orders and legal obstacles. The Docket will continue to keep track of developments. Global internal lawyers need to get ready for fast advancements related to:
Trade and job 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 two were both delayed by a month as the administration participates in negotiations. Meanwhile, China has begun its own retaliatory measures on US items. He had formerly revealed his intent to impose 25-percent escalating 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 new administration also extended a grace period for TikTok's upcoming restriction, sending 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 focus on American energy self-reliance and far from the previous administration's international sustainability efforts.
Steps in-house counsel must think about:
- Assess the impact of prospective tariff boosts on supply chain and company connection.
- Assess the organization's dependence on social networks platforms, such as for marketing purposes, and the potential needs to backup social networks data and possessions in the occasion their chosen platform stops to be readily available.
- Consider how developments in the new administration's method to ecological, sustainability and governance issues may impact the organization's ESG technique.
Disclaimer: The info in any resource in this site need to not be construed as legal recommendations or as a legal viewpoint on particular truths, and must not be considered representing the views of its authors, its sponsors, and/or ACC. These resources are not meant as a definitive statement on the subject attended to. Rather, they are meant to function as a tool offering useful assistance and recommendations for the hectic in-house practitioner and other readers.
