Many employers have recently looked to their internal workplace training for opportunities to implement or enhance existing employee education on diversity, equity and inclusion. A new Executive Order issued by President Trump on September 22, 2020 seeks to regulate the content of diversity training for federal contractors and federal grant recipients.

The Executive Order on Combating Race and Sex Stereotyping states that “training to create an inclusive workplace is appropriate and beneficial,” but forbids federal contractors from conducting workplace training that “inculcates in its employees any form of race or sex stereotyping or any form of race or sex scapegoating.” It follows a letter issued on September 4, 2020, instructing federal departments and agencies to cease and desist any training on “critical race theory,” “white privilege,” or any other “un-American propaganda” suggesting that the United States or any race or ethnicity “is inherently racist or evil.”

The order’s requirements
Beginning November 21, 2020, the order requires that every new federal contract and subcontract prohibit workplace training that includes any of the following “divisive concepts”:

1. One race or sex is inherently superior to another race or sex;
2. The United States is fundamentally racist or sexist
3. An individual, by virtue of his or her race or sex, is inherently racist, sexist, or oppressive, whether consciously or unconsciously;
4. An individual should be discriminated against or receive adverse treatment solely or partly because of his or her race or sex;
5. Members of one race or sex cannot and should not attempt to treat others without respect to race or sex;
6. An individual’s moral character is necessarily determined by his or her race or sex;
7. 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;
8. Any individual should feel discomfort, guilt, anguish, or any other form of psychological distress on account of his or her race or sex; or
9. Meritocracy or traits such as a hard work ethic are racist or sexist, or were created by a particular race to oppress another race.

The order also includes a notice and posting obligation for contractors, and it directs the Office of Federal Contract Compliance Programs (OFCCP) to develop a “hotline” to receive and investigate complaints that a federal contractor is violating the order and to publish a request for information from federal contractors, subcontractors and their employees regarding training, workshops or similar programming provided to employees.

With regard to federal grant recipients, the order instructs the heads of all agencies to review grant programs to identify those for which the agency may require grant recipients to certify they will not use federal funds to promote any of the concepts listed above. 

Violators of the order’s requirements may be subject to contract suspension or termination and the contractor may be suspended or debarred. 

Practical implications for employers
Racism, sexism, diversity and inclusion are complex subjects to address in the workplace, and there are various different approaches to doing so. Research continues to show that companies who embrace diversity and inclusion in all aspects of their business statistically outperform their peers over time. Accordingly, employers should continue to invest resources and create expectations and accountability around cultural competency and inclusion on an ongoing basis. This type of investment can also help reduce risk of exposure to employment discrimination claims.

The lines between what is and is not permissible under President Trump’s executive order are not entirely clear. The order may face legal challenges, and it will likely be rescinded if Vice President Biden is elected President. In the meantime, employers subject to the order should review their diversity, equity and inclusion initiatives and consult with counsel to understand any related risks. 

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