An executive order issued March 26 directs federal agencies to prohibit certain diversity, equity and inclusion practices in federal contracting.
The order requires agencies to include new contract clauses barring what it defines as “racially discriminatory DEI activities.”
The directive applies to contractors and subcontractors involved in federal work and mandates compliance within 30 days.
It requires contractors to provide records and report potential violations, with penalties including contract termination or suspension and possible ineligibility for future contracts.
The order also instructs agencies to review compliance, while the Office of Management and Budget and other officials will issue guidance and identify sectors at higher risk of violations.
It further calls on the attorney general to consider enforcement actions under the False Claims Act for noncompliance.
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