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How could a new executive order affect workplace diversity?

On Behalf of | Jan 31, 2025 | Employment Law

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An executive order signed by the president on Jan. 21 introduces significant changes to how some workplaces handle diversity and inclusion, particularly for companies working with the federal government. The move aims to shift the focus from diversity initiatives to merit-based hiring.

The new order modifies several existing rules under the federal Equal Employment Opportunity Act, a cornerstone of workplace fairness since 1965. It removes requirements for federal contractors to actively promote diversity through affirmative action, potentially altering the landscape of workplace equality.

What are the order’s main provisions?

The Equal Employment Opportunity Act protects employees from discrimination based on race, gender, religion and other identities. Over time, it expanded to include protections for LGBTQ individuals.

The new executive order, however, rolls back affirmative action requirements. It eliminates the obligation for companies working with the federal government to create hiring plans for underrepresented groups and prohibits diversity, equity and inclusion (DEI) programs focused on identity-based preferences.

Instead, the order emphasizes qualifications and performance as the primary criteria for hiring and promotions, which may reduce the emphasis on addressing systemic inequalities in the workplace.

Opponents voice sharp criticism

The executive order primarily affects federal contractors, requiring them to certify that they are not running diversity programs deemed unlawful under the new guidelines. Affected companies must review their current diversity programs and adjust them accordingly within the 90-day grace period the order provides.

Critics argue that the changes could significantly undermine efforts to promote workplace equality. Civil rights advocates, such as the Congressional Black Caucus, view the rollback as a step backward for economic opportunities for Black and minority communities.

They warn that removing DEI programs could hinder economic growth for working families and undo decades of progress toward workplace equality.

Impacted employers should approach this transition carefully, as the order’s implications are still unfolding, and future legal challenges could arise. Executive orders do not require congressional approval and can be reversed by subsequent administrations, adding a layer of uncertainty to their permanence.

Potential effects on worker protections against discrimination

The executive order does not protect employers who discriminate. Discrimination based on race, gender, religion and other protected characteristics remains illegal under existing federal and state laws. The order does not provide a legal basis for employers to engage in discriminatory practices, and companies must still comply with all applicable anti-discrimination laws.

However, the changes could significantly impact employees, particularly those working for federal contractors, by altering the focus of diversity and inclusion programs. With the reduction of targeted diversity initiatives, employees from underrepresented groups might find fewer opportunities for advancement and professional development.