Remind me, what's an executive order?

Executive orders are directives bought by the president of the United States that direct government companies and officials to take particular actions. While they are not laws, they have the force of law and impact how existing laws are implemented or enforced.

Executive orders impact the firms of the executive branch and for that reason do not require the approval of Congress. They should be within the president's constitutional authority and may be challenged in court if considered unconstitutional.

Executive orders may be rescinded, overturned by future presidents, or challenged in court, and enforcement top priorities can alter during any administration.

The new administration's actions have significant impacts beyond executive orders. For more on mitigating risk, worldwide companies can take new opportunities by staying active.

Implications of the executive orders for DEI initiatives and employment in private-sector organizations

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

EO 11246 required every federal government contract to consist of a statement that the professional will not discriminate against any worker or candidate for employment based upon 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 might be altering enforcement priorities in the new administration. The order directs all federal agencies to "fight unlawful private-sector DEI preferences, requireds, 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 discriminate against their employees."

In addition to withdrawing EO 11246, the Jan. 21 executive order advises each agency of the federal government to recognize "approximately 9 potential civic compliance examinations" of private sector entities within 120 days of the order - by May 21, 2025.

The economic sector entities subject to these investigations consist of openly traded corporations, large nonprofits - including bar associations - large 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 react to the business's actions?
- How will customers and stakeholders respond?
What internal counsel needs to think about:

Assess any federal agreements and grants

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

- Prepare for increased scrutiny and prospective civil compliance examinations
Document, file, document

- Hiring and recruitment procedures
- Performance assessments and promotion decisions
- Training products and participation records
- Any changes to DEI policies
Implications for federal specialists

To name a few steps, the Jan. 21 Executive Order needs the heads of federal firms to include specific terms in every contract or grant award:

- "A term requiring the contractual counterparty or grant recipient to agree that its compliance in all aspects with all relevant Federal anti-discrimination laws is material to the federal government's payment choices for purposes of area 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 violate any relevant 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 enforces civil penalties on those who make false claims to the federal government in order to influence the payment or receipt of cash or residential or commercial property.

The accreditation requirement carries a prospective risk of lawsuits for federal specialists under the False Claims Act. In-house lawyers at federal contractors hence have a specific interest in guaranteeing their company's policies, treatments, practices, communications and material, are evaluated. Assess if adjustments are needed to reduce the danger of lawsuits.

Executive orders targeting prohibited immigration

President Trump's preliminary flurry of executive orders consisted of lots of - such as the Jan. 20 executive order "Protecting the American People Against Invasion" - targeted at limiting illegal immigration and employment deporting unlawful immigrants. The orders call for enforcement actions by federal agencies against illegal migration.

In-house attorneys should consider reviewing their organization's work eligibility verification process. They might likewise wish to consider whether the organization is gotten ready for reacting to an I-9 audit or a worksite enforcement action (or raid) by migration enforcement agencies.

Sectors that might be particularly impacted consist of agriculture, hospitality, and other industries such as 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 workforce.

In-house counsel have a crucial role to play in establishing and guaranteeing constant application of the Form I-9 and E-Verify guidelines the federal government uses to carry out and employment impose immigration 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 informative lists of considerations pertinent for internal legal representatives on the subject of I-9 audits and worksite enforcement actions.

If a company does not comply with a civil administrative warrant provided by US Immigration and Customs Enforcement (ICE), there is a danger that the company could start an I-9 audit if they felt a company was blocking their requirement to detain a non-citizen employee, or sometimes get a criminal warrant from a judge if actions support it.

Steps internal counsel should think about:

- Determine the number of employees could possibly be affected
- Review your company's work eligibility verification process
- Ensure your organization's process is documented and defensible
- Implement and enforce clear policies
- Monitor legal developments, consisting of lawsuits and enforcement guidance
Mitigate risk, stay active, and take new chances

The recent executive orders will considerably affect worldwide organizations. Legal departments and in-house counsel will require to help their companies understand and adapt to changes, ensuring compliance or litigating when appropriate.

A lot of the new administration's decisions will play out over the coming months, consisting of brand-new executive orders and legal challenges. The Docket will continue to keep an eye on advancements. Global in-house attorneys should prepare for rapid developments associated with:

Trade and tariffs. On Feb. 1, President Trump purchased the imposition of a 25-percent tariff on imports from Canada and Mexico, and employment 10-percent additional tariffs on imports from China. The former 2 were both delayed by a month as the administration takes part in settlements. Meanwhile, China has actually begun its own vindictive measures on US products. He had actually formerly revealed his intent to enforce 25-percent intensifying tariffs on Colombia (an action that was eventually not taken).
Technology and intellectual residential or commercial property. Among the president's very first actions was to rescind the previous administration's AI executive order. The new administration also extended a grace duration for TikTok's upcoming restriction, sending 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 global sustainability efforts.
Steps in-house counsel ought to consider:

- Assess the impact of possible tariff increases on supply chain and company continuity.
- Assess the organization's dependency on social media platforms, such as for marketing purposes, and the possible needs to backup social media data and properties in case their chosen platform ceases to be available.
- Consider how advancements in the brand-new administration's method to ecological, sustainability and governance concerns may affect the organization's ESG method.
Disclaimer: The info in any resource in this website ought to not be construed as legal guidance or as a legal viewpoint on specific realities, and should not be thought about representing the views of its authors, its sponsors, and/or ACC. These resources are not meant as a definitive declaration on the subject addressed. Rather, they are planned to work as a tool offering practical guidance and recommendations for the busy internal specialist and other readers.