On March 14, 2025, the U.S. Court of Appeals for the 4th Circuit stayed a nationwide preliminary injunction that temporarily blocked certain provisions of Executive Orders (EO) 14151 and 14173 issued by President Donald Trump on Jan. 20, 2025, and Jan. 21, 2025, respectively. The EOs aim to combat “illegal diversity, equity and inclusion (DEI) programs” in the federal and private sectors.
EOs 14151 and 14173 seek to terminate all illegal DEI mandates, policies, programs, preferences and activities in the federal and private sectors. The following orders are among those included in the EOs:
In National Association of Diversity Officers in Higher Education v. Trump, the plaintiffs argue that the above provisions are unconstitutional and should be vacated. In a Feb. 21, 2025, ruling, the U.S. District Court for the District of Maryland temporarily blocked the Termination and Certification Provisions and part of the Enforcement Threat Provision. In its ruling, the court reasoned that the provisions were likely unconstitutionally vague and restricted free speech.
On March 3, 2025, the Maryland District Court declined to stay the preliminary injunction, and on March 10, 2025, clarified that the injunction applied to all federal executive branch agencies, departments and commissions, not just those named in the complaint.
In its March 14, 2025, ruling, the 4th Circuit granted the government’s request to stay the nationwide preliminary injunction. Therefore, the Trump administration may continue to enforce the previously blocked provisions of the EOs while the court considers the merits of the case.
While the 4th Circuit ruling allows the Trump administration to continue its enforcement activity under the EOs, including the Termination and Certification Provisions for government contractors, employers should prepare for uncertainty, as the case is still pending, and such provisions may yet be blocked in a final ruling on the merits.
Moreover, neither the initial EOs nor the 4th Circuit ruling alter employers’ legal obligations, as employers are still prohibited from considering an individual’s protected trait (e.g., race, color, sex, religion, age or national origin) in employment decisions. Therefore, employers may consider reviewing existing DEI practices to ensure they do not discriminate on the basis of a federally protected trait.
The Fourth Circuit has expedited the briefing schedule for the appeal, with the government's opening brief due on April 8, 2025, and the plaintiffs' response due on May 8, 2025. A final decision from the appellate court is expected in the coming months.
On March 14, 2025, President Donald Trump issued an executive order (EO) rescinding Biden-era EO 14026. EO 14026 established the federal contractor minimum wage rate of $15 per hour in 2022 and provided for annual increases based on inflation. The new EO took effect immediately.
The U.S. Department of Labor (DOL) issued final rules in 2014 and 2021 to increase the minimum wage rate for certain federal contract workers. These rules implemented EO 13658 and EO 14026, which mandated increases to the minimum wage rate for federal contractors.
EO 13658, which has not been rescinded and remains in effect, generally applies to contracts with the federal government that were entered into, extended or renewed before Jan. 30, 2022. Contracts with the federal government that were entered into on or after Jan. 30, 2022 (or renewed or extended on or after that date), were subject to EO 14026.
The most recent minimum wage rate increase under EO 14026 occurred on Jan. 1, 2025, and set the rate for federal contractors working under covered contracts at $17.75 per hour. In recent years, EO 14026 has also been the subject of litigation that resulted in split rulings.
Although federal contractors covered by EO 13658 are still required to pay the minimum wage rate of $13.30 per hour ($9.30 per hour for tipped employees) when it is applicable, pursuant to the revocation of EO 14026 by the March 2025 EO, federal contractors are no longer required to pay the minimum wage rate of $17.75 per hour EO 14026 previously required in certain circumstances.
The March 2025 EO does not clarify whether federal contractors previously subject to EO 14026 will now be subject to EO 13658. However, to the extent they are not, federal contractors must still pay workers the higher out of federal minimum wage rate, applicable state minimum wage rate, or any other applicable law or regulation.
It is yet to be determined whether and to what extent the DOL will rescind the associated regulations that implemented EO 14026. However, with their underlying authority revoked, it is assumed that those regulations will not be enforced.
Federal contractors should closely monitor this area and consult with legal counsel on how ongoing developments affect their operations.
On March 19, 2025, the U.S. Equal Employment Opportunity Commission (EEOC) and the U.S. Department of Justice (DOJ) issued joint guidance on illegal and discriminatory diversity, equity and inclusion (DEI) practices. The EEOC also issued frequently asked questions (FAQs) regarding DEI-related discrimination. The guidance provides some clarity as to the agencies’ position on what may constitute illegal DEI and offers steps employees may take to report violations.
On Jan. 20, 2025, and Jan. 21, 2025, President Donald Trump issued executive orders (EOs) 14151 and 14173, respectively, which seek to terminate all illegal DEI mandates, policies, programs, preferences and activities. However, neither EO defines what practices or programs may constitute illegal DEI. The EEOC and DOJ guidance provides some clarity as to the agencies’ positions on illegal DEI.
Under Title VII of the Civil Rights Act (Title VII), employers with 15 or more employees may not discriminate on the basis of an individual’s protected trait (e.g., race, color, religion, sex or national origin). The EEOC FAQs and the EEOC and DOJ joint guidance state that DEI programs may be unlawful under Title VII if they are motivated, in whole or in part, by an employee’s protected trait. The guidance identifies specific instances of potential DEI-related discrimination in the workplace, including:
The guidance further clarifies that unlawful discrimination occurs even if a protected trait is just one factor among several rather than the sole factor. Additionally, employers may not justify taking an employment action on the basis of a protected trait because they have a business interest in diversity, including a client or customer preference. Finally, the guidance provides steps employees may take to file a claim of discrimination with the EEOC.
Although the EEOC and DOJ guidance does not alter existing law (which has always banned consideration of an individual’s protected trait in employment decisions), it provides insight into how such agencies will evaluate claims of DEI-related discrimination and how employers may prevent such claims. In light of the guidance, employers may consider reviewing existing DEI practices to ensure they do not discriminate on the basis of a federally protected trait. For example, employers may wish to review existing hiring and interview selection practices, employee resource and affinity group or training program membership guidelines, and workplace trainings to confirm they do not have a disparate impact on any protected class.
Nothing for this month...
4/30 – Form 941 Filing Deadline 4/30 – Remove OSHA Form 300A
Nothing so far…
6/2 – Prescription Drug Data Collection Reporting – group health plans and health insurers are required to submit data regarding drug costs to the Department of Treasury, Department of Labor (DOL) and Health and Human Services (HHS). Reporting is due annually on June 1st, or the first business day after, if June 1st falls on a weekend day or holiday.
Lighthouse HR Support (LHRS) provides practical human resource information and guidance based upon our knowledge and experience in the industry and with our clients. LHRS services are not intended to be a substitute for legal advice. LHRS services are designed to provide general information to human resources and/or business professionals regarding human resource concerns commonly encountered. Given the changing nature of federal, state and local legislation and the changing nature of court decisions, LHRS cannot and will not guarantee that the information is completely current or accurate. LHRS services do not include or constitute legal, business, international, regulatory, insurance, tax or financial advice. Use of our services, whether by phone, email or in person shall indicate your acceptance of this knowledge.
