New Executive Order Bans Certain Diversity Training Topics for Federal Contractors, Grant Recipients and Uniformed Services

The new Executive Order on Combating Race and Sex Stereotyping could have broad-reaching effects for executive departments and agencies, uniformed services, federal contractors and grant recipients, as well as institutions regulated by Title VII of the Civil Rights Act of 1964.

What does the order do?

• It prohibits workplace training “that inculcates in its employees any form of race or sex stereotyping or any form of race or sex scapegoating.”
• It outlines concepts covered organizations may not include in employee training, specifically barring the use of “materials teaching that men and members of certain races, as well as our most venerable institutions, are inherently sexist and racist,” which, according to the order, “are appearing in workplace diversity trainings across the country, even in components of the Federal Government and among Federal contractors.”

• It requires that government agencies include provisions in new government contracts barring contractors from using:

[A]ny workplace training that inculcates in its employees any form of race or sex stereotyping or any form of race or sex scapegoating, including the concepts that (a) one race or sex is inherently superior to another race or sex; (b) an individual, by virtue of his or her race or sex, is inherently racist, sexist, or oppressive, whether consciously or unconsciously; (c) an individual should be discriminated against or receive adverse treatment solely or partly because of his or her race or sex; (d) members of one race or sex cannot and should not attempt to treat others without respect to race or sex; (e) an individual’s moral character is necessarily determined by his or her race or sex; (f) an individual, by virtue of his or her race or sex, bears responsibility for actions committed in the past by other members of the same race or sex; (g) any individual should feel discomfort, guilt, anguish, or any other form of psychological distress on account of his or her race or sex; or (h) meritocracy or traits such as a hard work ethic are racist or sexist, or were created by a particular race to oppress another race.

• It requires government contractors to impose the same prohibitions on their subcontractors and suppliers. Contractors must also provide notices to labor unions of the employer’s obligations under the order. These new contract clauses must be in all contracts entered into 60 days after the order was issued.

What does this mean for employers?

The order’s broad language makes uncertain the types of diversity trainings that will be permitted moving forward and effectively limits the equal employment opportunity training contractors and government grant recipients may lawfully provide their employees.

It also remains unclear if and to what extent the order applies to current contracts. Despite this uncertainty, the order makes clear that violators can be subject to contract suspension or termination and, more severely, that the contractor could be subject to suspension or debarment.

Federal agency heads must review their grant programs and prepare a report for the Director of the Office of Management and Budget within 60 days. They will have to identify programs the agency concludes must now certify that it will not use federal funds to “promote the concepts” prohibited by the order.

With respect to Title VII, the order instructs the attorney general to assess the extent to which workplace training that teaches “divisive concepts” might create a hostile work environment, which could give rise to liability under the act.

If fully implemented, which remains to be seen, the order could force major changes to trainings on race and sex. Those covered by the order will also have to evaluate whether it conflicts with other federal or state rules that affirmatively require diversity and inclusion training. Covered entities should read the order closely and consult legal counsel before implementing any such programming.

Some commentators have suggested that the order may be subject to legal challenge under certain federal statutes and the First Amendment. We will monitor developments and provide updates as appropriate. Please contact Stephanie Poucher or any other member of Phelps’ Labor and Employment team if you have questions or need compliance advice and guidance.