Addressing DEI Discrimination by Federal Contractors

This Executive Order prohibits companies that do business with the federal government from engaging in "diversity, equity, and inclusion" (DEI) activities that the administration defines as racially discriminatory. It mandates that all federal contracts and subcontracts include a clause expressly forbidding disparate treatment based on race or ethnicity in areas like hiring, promotions, and program participation. This order alters how corporate hiring, mentorship, and promotion pipelines are structured, as companies will be prohibited from running leadership programs, clubs, or recruitment drives that limit access based on a candidate's race or ethnicity. Consequently, employment and resource allocation decisions at these entities must rely on merit-based criteria to maintain compliance and preserve their federal funding.