Redstone Government Consulting Blog | Sheri Buchanan and Jamie Brabston

On March 26, 2026, President Donald J. Trump signed an executive order (EO) titled, "Addressing DEI Discrimination by Federal Contractors." The order establishes new mandatory contract clause requirements for federal contractors and subcontractors at all tiers, creates reporting and monitoring obligations, and designates noncompliance as material under the False Claims Act (FCA). Federal agencies are required to incorporate the new clause into contracts and contract-like instruments by April 25, 2026. The EO applies to federal contracts, subcontracts, and contract-like instruments subject to the Federal Property and Administrative Services Act (40 U.S.C. § 101 et seq.).

EO 14173 revoked EO 11246 Equal Employment Opportunity, which required covered federal contractors to practice affirmative action, develop written Affirmative Action Plans (AAPs) and implement compliant programs directed towards equal opportunities for women and minorities. This major change left contractors with a choice: set aside all efforts previously made toward compliance with EO 11246, or continue with employment analytics under a framework acceptable under EO 14173. In this article, we explain why we encourage you to consider the continuation of these efforts.