This past Friday, the U.S. Court of Appeals for the Fourth Circuit lifted the nationwide injunction on President Trump's Executive Orders targeting employers’ Diversity, Equity and Inclusion (DEI) programs. This ruling will allow the Administration, and federal agencies, to immediately move ahead with requiring federal contractors to certify compliance with all applicable non-discrimination laws. However, legal challenges continue.

The Fourth Circuit’s order appears to indicate that the three-judge appellate panel believes the Trump Administration is likely to prevail on the merits. While authoring three separate concurring opinions, the judges agreed that the Executive Orders, as written, are not unlawful.

Judge Pamela Harris wrote that:

“The challenged Executive Orders, on their face, are of distinctly limited scope. The Executive Orders do not purport to establish the illegality of all efforts to advance diversity, equity or inclusion, and they should not be so understood. Instead, the so-called “Certification” and “Enforcement Threat” provisions apply only to conduct that violates existing federal anti-discrimination law.”

With this ruling, we expect federal agencies to soon move forward requiring federal contractors and grant recipients to certify that they do not have any programs that violate applicable federal anti-discrimination laws. Below is an example of the certification language federal agencies have been sending to contractors:

Contractor certification regarding compliance with applicable Federal anti-discrimination laws must confirm:

1. The contractor is in compliance in all respects with all applicable Federal anti-discriminationlaws is material to the government’s payment decisions for purposes of section 31 USC3729(b)(4) (False Claims Act);
2. The contractor does not operate any programs promoting Diversity, Equity, and Inclusion thatviolate any applicable Federal anti-discrimination laws.

As referred to in “1.” above, employers’ responses to the certification may have significant legal and monetary consequences, including exposure to claims and findings under the False Claims Act. As a result, employers should carefully consider their response to the certification and ensure compliance with applicable anti-discrimination laws before certifying.

Given this development, employers also should conduct a legally privileged DEI risk assessment to ensure all aspects of DEI programs and communications are in compliance with applicable law.

If you have questions about this ruling or its implications for your DEI and EEO legal compliance, simply reply to this Alert or contact the Silberman Law legal professional with whom you work.