Key Executive Orders for US Government Contractors to Watch – An Evolving Landscape Introduction

Since taking office, the new Administration has issued hundreds of Executive Orders and other presidential actions aimed at reshaping various aspects of the federal government, including significant changes that will impact government contractors. The executive actions from the administration up through January 27, 2025, that are particularly relevant to US government contractors fall into several broad categories: (1) reversal of the prior administrations’ orders governing Diversity, Equity, & Inclusion (DEI) and anti-discrimination obligations; (2) national security; (3) government procurement and climate change; (4) labor and workforce protections and (5) COVID-related policies. While the details regarding how each of these Executive Orders will be implemented remain unclear, it is prudent for US government contractors to stay updated on if and how a particular Executive Order will impact existing and new business. As explained below, this is particularly important for any Executive Order like the Executive Order titled Ending Illegal Discrimination and Restoring Merit-Based Opportunity that was issued on January 21st that contains specific references to the False Claims Act and will require contractor certification of compliance.

Executive Orders in Context

Executive Orders are directives issued by the President of the United States to manage operations within the federal government. They derive their authority from the Constitution and statutes, enabling the President to enforce laws or direct the operation of government agencies. Executive Orders have the force of law, but they are subject to judicial review and, therefore, can be challenged in court if deemed to exceed the President's constitutional or statutory authority. These Executive Orders can significantly impact other branches of government by directing how laws should be implemented, potentially influencing legislative priorities or administrative procedures. Additionally, Executive Orders can affect private companies, especially if they pertain to regulations, federal contracts, or economic policies. Challenges to Executive Orders typically arise when there is a belief that the President has overstepped their authority, violated constitutional principles, or encroached upon the powers of Congress or the judiciary. Courts can invalidate Executive Orders that they find unlawful. Therefore, it is crucial for affected parties to stay informed about new Executive Orders and assess their potential implications promptly.

While the new Administration is issuing Executive Orders at an accelerated rate, beyond those even originally anticipated, it is important for government contractors to remember that Executive Orders are subject to judicial review, and, even if they survive such scrutiny, it could be in a modified state. Additionally, most of the new Executive Orders are broad in nature, meaning that there is significant ambiguity that will have to be addressed either by further executive action or clarification from impacted federal agencies. Accordingly, it is imperative for contractors to identify which Executive Orders impact their business because of their contractor status or because of a particular industry, and then track their implementation. Taking action too early or too late can create unnecessary confusion or disruption to business operations. As discussed in our prior Client Alert, Preparing for the Administration Change: A Toolkit for Government Contractors and Grant Recipients, having a comprehensive plan, including these presidential actions, will enable organizations to make any necessary changes in a coordinated manner.

Executive Orders Impacting Government Contracts

The pace and volume at which the new Administration is issuing and revoking Executive Orders can make it difficult for contractors to review and confirm which, if any, of the newly issued or revoked Executive Orders relate to or could otherwise impact business operations. Ultimately, whether an Executive Order applies to a particular contractor will depend on many variables, including the type of contractor it is, the volume of contract dollars the contractor has with the US government, and its industry.

On January 20th, President Trump revoked dozens of existing Executive Orders and related policy initiatives from prior administrations.¹ The revocation of these Executive Orders will have the greatest impact on government contractors involved in environmental sustainability, climate change, diversity and inclusion initiatives, energy infrastructure, public health, and immigration-related services. Contractors should remain aware of shifting priorities in federal procurement to anticipate potential changes in their obligations, opportunities, and compliance requirements. The most relevant of these include:

• Executive Order 13985 (Advancing Racial Equity and Support for Underserved Communities Through the Federal Government): Contractors involved in federal contracts may see changes in diversity, equity, and inclusion (DEI) requirements. If DEI initiatives were embedded in federal procurement processes (e.g., for hiring, contracting, or reporting), their removal could alter expectations for contractors.
• Executive Order 13990 (Protecting Public Health and the Environment and Restoring Science to Tackle the Climate Crisis): Contractors in industries like construction, manufacturing, and energy may face regulatory shifts. The focus on climate change could have led to changes in the way contractors are required to meet environmental standards, and the revocation may reduce those requirements, which could be beneficial or challenging depending on the nature of the contract.
• Executive Order 14057 (Catalyzing Clean Energy Industries and Jobs Through Federal Sustainability): Contractors working in clean energy, sustainability, or federal energy efficiency programs may see a reduction in demand or support for green initiatives. Clean energy contractors might be affected by a potential rollback of mandates promoting sustainability and clean energy jobs in government contracts.
• Executive Order 14069 (Advancing Economy, Efficiency, and Effectiveness in Federal Contracting by Promoting Pay Equity and Transparency): If this order was driving pay equity initiatives and transparency requirements for contractors, its removal could lower the burden of these obligations for contractors working on federal contracts.
• Executive Order 14082 (Implementation of the Energy and Infrastructure Provisions of the Inflation Reduction Act of 2022): Contractors in infrastructure and energy sectors may experience a shift in policy related to funding or regulations tied to energy infrastructure and the Inflation Reduction Act. The revocation could reduce incentives or regulations aimed at green infrastructure projects.
• Executive Order 13986 (Ensuring a Lawful and Accurate Enumeration and Apportionment Pursuant to the Decennial Census): Contractors involved in census-related projects could see changes or cancellations of contracts connected to the census enumeration.
• Executive Orders Related to Immigration (e.g., EO 13993, 14010, and 14012): Contractors in industries related to immigration, border security, or public health may experience shifts in contracts as federal policies regarding immigration enforcement or refugee resettlement programs change.
• Executive Order 14000 (Supporting the Reopening and Continuing Operation of Schools and Early Childhood Education Providers): Contractors providing services related to the reopening of schools or educational programs may see funding cuts or changes to government contracts tied to educational programs.
• Executive Order 14027 (Establishment of the Climate Change Support Office): Contractors working with federal agencies on climate change mitigation and adaptation may see reduced government contracts or changes to the scope of work required for climate-related federal projects.

Contractor Certification and Executive Order Compliance: Revocation of EO 11246

The presidential action taken to date that most directly impacts a significant number of government contractors was the issuance of the Executive Order titled. “Ending Illegal Discrimination and Restoring Merit-Based Opportunity” This January 21st Order rescinded “illegal” federal diversity, equity, inclusion, and accessibility (DEI and DEIA) policies, including those advanced for the last sixty years through Executive Order 11246, the primary affirmative action and nondiscrimination obligation enforced by the US Department of Labor’s Office of Federal Contract Compliance Programs (OFCCP).

Executive Order 11246, which was first issued on September 24, 1965, prohibited companies that do business with the US government from “discriminat[ing] against any employee or applicant for employment because of race, color, religion, sex, sexual orientation, gender identity, or national origin,” and also required contractors to take “affirmative action” towards ensuring employment without regard to those same characteristics. With the revocation of EO 11246, contractors’ obligations related to developing and documenting affirmative actions to promote the hiring, retention, and promotion of workers in these protected categories have ended.

On January 23, 2025, OFCCP announced it was taking action consistent with the new Executive Order, and that it would “immediately” cease “promoting ‘diversity,’” “[h]olding Federal contractors and subcontractors responsible for taking ‘affirmative action,’” and allowing or encouraging contractors to engage in “workforce balancing based on race, color, sex, sexual preference, religion, or national origin.” While the OFCCP stated that additional guidance would be forthcoming “in the upcoming weeks,” in the interim, OFCCP advised contractors that they may continue to comply with the regulatory scheme in effect on January 20, 2025, for the next 90 days – tracking the exact language in the Order. This 90-day period allows covered contractors time to wind down their OFCCP compliance programs and revise any workplace policies and procedures affected by the new Order.

Importantly, the Ending Illegal Discrimination and Restoring Merit-Based Opportunity Executive Order did not – and cannot – change or modify other equal employment opportunity laws enforced by the OFCCP that are codified in federal statutes, such as Section 503 of the Rehabilitation Act of 1973 (which prevents discrimination based on disability) and the Vietnam Era Veterans' Readjustment Assistance Act, or VEVRAA (which prohibits discrimination on the basis of covered military service). Indeed, the OFCCP statement on January 23rd confirmed that the Office will continue to enforce both Section 504 and VEVRAA. Contractors and grantees should accordingly continue their practices for ensuring compliance with these laws and be prepared to follow the additional guidance the OFFCP has promised in the coming weeks.

Reps, Certifications, & Possible False Claims Risk

The Ending Illegal Discrimination and Restoring Merit-Based Opportunity Executive Order had two key additional requirements that other presidential actions executed have not included:

1. A requirement that contractors “agree that its compliance in all respects with all applicable Federal anti-discrimination laws is material to the government’s payment decisions for purposes of section 3729(b)(4) of title 31, United States Code;” and
2. A requirement that contractors certify that that they are not “operat[ing] any programs promoting DEI that violate any applicable Federal anti-discrimination laws.”

These two requirements explicitly and implicitly reference the False Claims Act, the federal law that allows the government and private whistleblowers to sue companies or individuals who have defrauded the government. While False Claims Act liability is not a new risk facing government contractors, the inclusion of these two requirements, which track the FCA legal principles of materiality and express certifications, increase the likelihood that either the government or contract employees will use non-compliance with this new Executive Order as a basis for a False Claims Act lawsuit. While it is not clear how courts will analyze whether an Executive Order can convert a presidential policy into a contractual obligation that is material to the government’s payment, the framework for such an argument has been set.² Based on these requirements, contractors who were previously subject to EO 11426 should promptly review existing policies, procedures, and practices and ensure that they align with remaining federal equal-employment and anti-discrimination requirements, whether under the Section 504, VEVRAA or other statutes such as Title VII of the Civil Rights Act, the Americans with Disabilities Act, or other federal nondiscrimination laws. As a practical matter, these changes will most directly impact human resources and recruiting teams, with other employee populations likely not noticing a significant change. As a result, organizations may choose to communicate with employees and other key stakeholders to minimize confusion regarding what EEO and anti-discrimination mandates still exist after the enactment of the Ending Illegal Discrimination and Restoring Merit-Based Opportunity Executive Order.

Takeaways for Federal Government Contractors and Grantees

The evolving landscape of Executive Orders underscores the importance of vigilance and adaptability for government contractors and grantees. While many of these orders are broad in scope, their implementation will depend on agency interpretations, judicial review, and further regulatory developments. As such, contractors should be strategic and not reactive when updating and revising existing policies, procedures, and operational practices, as it is likely that the final orders and rules will be modified from their initial version.

The revocation of prior Executive Orders, particularly those related to DEI programs and climate policies, may significantly alter compliance obligations and operational strategies. Moreover, the new certification requirements under the Ending Illegal Discrimination and Restoring Merit-Based Opportunity Executive Order introduce potential False Claims Act risks, necessitating a proactive approach to compliance. Contractors should take steps to assess their obligations, update internal policies, and ensure alignment with the new regulatory framework. While it remains to be seen whether the government will devote significant resources to the enforcement of the Executive Orders through the False Claims Act, an uptick in False Claims Act whistleblower activity and subsequent government investigations typically follow executive branch statements of enforcement priorities.

To navigate these changes effectively, contractors and grantees should:

• Evaluate the Impact of Revoked and New Executive Orders: Assess whether recent presidential actions affect your contractual obligations, regulatory compliance, or business opportunities.
• Communicate with Federal Customers. Open lines of communication with contracting officers on what impact, if any, the recent presidential actions have on contracts and grants.
• Review and Update Compliance Programs: Ensure that internal policies reflect the latest legal requirements, particularly regarding DEI, environmental standards, and labor protections.
• Enhance Oversight of Certification and Reporting Obligations: Given the heightened False Claims Act risks, implement internal review processes before making any required certifications to the government.
• Monitor Agency Guidance and Judicial Challenges: Stay informed about forthcoming regulatory interpretations and potential legal challenges that may modify enforcement or compliance expectations.
• Communicate Changes Internally and Externally: Provide clear guidance to HR, legal, and compliance teams, as well as external stakeholders, to mitigate confusion and ensure a smooth transition to the new regulatory landscape.

By taking these steps, contractors and grantees can mitigate risk, maintain compliance, and position themselves effectively in an evolving federal procurement environment while also minimizing operational disruptions that may otherwise occur given the volume of presidential actions that are occurring.

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