An Overview of the New DEI Executive Order: Scope and Limitations
Blank Rome – On March 26, 2026, President Trump signed Executive Order 14398 (“EO 14398”) titled “Addressing DEI Discrimination by Federal Contractors,” taking aim at the diversity, equity, and inclusion (“DEI”) practices of federal contractors. EO 14398 ventures into territory already covered by the President’s prior DEI-related executive orders, in particular EO 14173, which requires a contractor certification regarding “illegal DEI,” but goes further. It directs federal agencies to include a mandatory contract clause prohibiting “racially discriminatory DEI activities” in all covered contracts and subcontracts, requires prime contractors to police the DEI practices of subcontractors at every tier, imposes new reporting requirements, and threatens a panoply of consequences for noncompliance, including contract termination, False Claims Act (“FCA”) exposure, and suspension and debarment