Client Alert: New Executive Orders on DEI
What Nonprofits and Associations Need to Know and Consider
Date: January 27, 2025
Nonprofits and associations should take immediate steps to identify, review, and, if necessary, adjust their DEI programs in light of these executive orders. Organizations that receive Federal funding will likely need to take more immediate action.
EO entitled: Ending Illegal Discrimination and Restoring Merit-Based Opportunity
This executive order aims to end illegal discrimination and preferences based on race and sex in federal policies and practices and enforce civil rights laws across federal agencies and the private sector. Under Section 4 of this EO, all government agencies, with the assistance of the Attorney General, are directed to develop a plan within 120 days to deter DEI programs that constitute illegal discrimination or preferences. Specifically, each agency must identify potential compliance investigations of:
- Large non-profit corporations or associations, foundations with assets of $500 million or more
- State and local bar and medical associations
- Institutions of higher education with endowments over $1 billion.
In addition, nonprofits and associations with government contracts, including grant agreements, will be subject to Section 3(b) of this EO which concerns the Federal contracting process. Specifically, every government contract or grant award must include a term requiring the recipient to certify compliance with federal anti-discrimination laws and ensure that they do not operate any programs promoting DEI that violate Federal anti-discrimination laws. Organizations that are Federal contractors or receive federal grants and funding may receive communication from government agencies demanding such certification.
It should be noted that this EO includes specific exceptions and does not apply to preferences for veterans or persons protected by the Randolph-Sheppard Act[2]. Additionally, this EO does not prohibit persons teaching at a Federally funded institution of higher education from advocating for and promoting DEI “as part of a larger course of academic instruction.”
EO entitled: Defending Women From Gender Ideology Extremism and Restoring Biological Truth to the Federal Government
This executive order establishes the policy of the United States to recognize only two immutable biological sexes, male and female. It aims to remove gender ideology (as defined by this EO[3]) from government practices and thereby protect women's rights in single-sex spaces, specifically naming women’s domestic abuse shelters, women’s workplace showers, and women’s prisons and detention centers. Specifically, the EO explicitly requires that government-issued identification documents must reflect the holder’s sex as defined under this EO; government agency forms that require an individual’s sex shall list male or female, and shall not request gender identity.
This EO also applies to federal funds and grants under Section 3(g), and each agency is mandated to assess grant conditions to ensure grant funds do not promote gender ideology as defined under this EO. For associations and nonprofits receiving federal government grants relating to programs on gender identity, the terms and conditions of such grant agreements and scope may require adjustments.
Programs to Review
While the federal government agencies are expected to issue further guidelines and instructions to implement the Trump administration’s Executive Orders in the coming weeks, nonprofits and associations should review the following types of DEI programs and initiatives that may be viewed as discriminatory under the EOs:
- Programs that have eligibility requirements excluding participation based on race and sex.
- Programs that set targets and goals to achieve diversity based on race and sex.
- Programs that require or reserve seats, vacancies, or awards to be filled based on race and sex.
- Programs that prefer candidates and applicants based on race and sex.
- Programs that use race and sex as metrics to evaluate performance.
Disclaimer: Each organization’s DEI programs and initiatives would need to be reviewed on a case-by-case basis.
Given the potential risks of being deemed non-compliant, organizations should consider temporarily deactivating public-facing websites that feature DEI programs pending an internal legal review and further guidance from the government agencies and the Attorney General. However, organizations should exercise caution against making abrupt changes. The Executive Order on Ending Radical and Wasteful Government DEI Programs mandates the termination of all DEI, DEIA, and Environmental Justice offices and positions, including Chief Diversity Officer roles, within federal government entities. It is important to note that this provision applies only to federal government DEI offices and positions.
Private employers and workplaces should be aware that abrupt termination of employees could lead to discrimination claims. Therefore, it is crucial to carefully review and adjust DEI initiatives, to include an assessment of the extent to which any such activities are funded wholly or in part by government funding, rather than completely dismantling them without proper evaluation.
These executive orders underscore the new administration’s policy position against the use of federal funds to support DEI initiatives, as well as any race and sex-conscious DEI programs that may be deemed discriminatory. Nonprofits and associations are advised to immediately identify, review and, if necessary, adjust their DEI programs considering these executive orders. Further guidance from government agencies is anticipated, and we will continue to provide updates as more information becomes available.
This article aims to inform our nonprofit and association clients about the recent executive orders and their potential impact on DEI programs. We understand the concerns and challenges faced by organizations committed to DEI and will continue to provide support and updates as the situation evolves.
[1] These Executive Orders, available on the White House website: https://www.whitehouse.gov/presidential-actions include: Initial Rescissions Of Harmful Executive Orders and Actions, Reforming The Federal Hiring Process and Restoring Merit to Government Services, Ending Radical And Wasteful Government DEI Programs and Preferencing, Ending Illegal Discrimination and Restoring Merit-Based Opportunity, Defending Women From Gender Ideology Extremism and Restoring Biological Truth to the Federal Government, and Keeping American Safe In Aviation.
[2] The Randolph-Sheppard Act primarily protects and benefits blind persons.
[3] The term “Gender ideology” is defined in Section 2 (f) of the EO as: “Gender ideology” replaces the biological category of sex with an ever-shifting concept of self-assessed gender identity, permitting the false claim that males can identify as and thus become women and vice versa, and requiring all institutions of society to regard this false claim as true. Gender ideology includes the idea that there is a vast spectrum of genders that are disconnected from one’s sex. Gender ideology is internally inconsistent, in that it diminishes sex as an identifiable or useful category but nevertheless maintains that it is possible for a person to be born in the wrong sexed body.
The information contained here is not intended to provide legal advice or opinion and should not be acted upon without consulting an attorney. Counsel should not be selected based on advertising materials, and we recommend that you conduct further investigation when seeking legal representation.
The information contained here is not intended to provide legal advice or opinion and should not be acted upon without consulting an attorney. Counsel should not be selected based on advertising materials, and we recommend that you conduct further investigation when seeking legal representation.