Addressing DEI Discrimination by Federal Contractors

This EO directs executive departments and agencies, within 30 days, to include in federal contracts, subcontracts, and lower-tier subcontracts a clause prohibiting contractors from engaging in "racially discriminatory DEI activities", defined as disparate treatment based on race or ethnicity in recruitment, employment, contracting, program participation, or resource allocation. Noncompliance may result in contract cancellation, termination, suspension, or debarment, and compliance is deemed material to payment under the False Claims Act. The Director of the Office of Management and Budget must issue compliance guidance, the Attorney General must consider False Claims Act actions against violators, the Federal Acquisition Regulatory Council must amend the Federal Acquisition Regulation and issue interim guidance within 60 days, and each agency head must report on implementation to the Assistant to the President for Domestic Policy within 120 days.

Federal contractors and subcontractors to Refrain from engaging in racially discriminatory DEI activities as defined in section 2 of the order in connection with performance of work under covered federal contracts (unclear). Federal contractors and subcontractors to Furnish all information and reports, including access to books, records, and accounts, as required by the contracting agency to ascertain compliance with the clause (unclear). Federal contractors to Report any subcontractor's known or reasonably knowable conduct that may violate the clause to the contracting department or agency and take any remedial actions directed by that department or agency (unclear). Federal contractors to Inform the contracting department or agency if a subcontractor sues the contractor and the suit puts at issue the validity of the clause (unclear).

No known legal challenges.