Compliance Stuff

Key Takeaways Executive Order 14398 narrows the administration’s focus to race- and ethnicity-based DEI practices but expands contractor risk through mandatory contract clauses, reporting obligations, and a more robust enforcement framework. Although EO 14398 does not expressly state that it applies retroactively, federal contractors should expect it to affect existing contracts quickly as agencies begin adding the required clause, and contractors begin flowing it down to subcontractors. The order creates significant uncertainty for contractors balancing federal requirements with state and local affirmative action obligations, making careful review of current programs and contracting practices essential. Federal contractors should act now to assess diversity, equity, and inclusion-related (DEI) policies, strengthen documentation and certification processes, and build oversight mechanisms for subcontractor compliance in light of potential False Claims Act (FCA) exposure. The recent...

In our March 24 2025, blog  post  we discussed the federal Equal Employment Opportunity Commission’s (EEOC) recent  guidance  regarding what constitutes unlawful “diversity, equity, and inclusion” (DEI) policies. Among other things, the guidance specifies that employees may claim a “hostile work environment’ (a form of unlawful “harassment”) by showing that an employer’s DEI training was discriminatory in content, application, or context. Under Title VII of the Civil Rights Act of 1964 (Title VII), harassment based on race, sex, or another protected characteristic is unlawful where (1) enduring the offensive conduct becomes a condition of continued employment, or (2) the conduct is sufficiently  severe  or  pervasive  to create a work environment that a reasonable person would consider  intimidating, hostile, or abusive . According to the  EEOC , “Petty slights, annoyances, and isolated incidents (unless extremely serious) will not rise...