Details about Trump's executive orders around DEI are causing confusion

Associated Press

21-02-2025

WASHINGTON (AP) — HAYA PANJWANI, host: In front of a large crowd in Washington, Donald Trump, shortly after being sworn into office for his second presidential term, signed a slew of executive orders. Those orders were what he calls 'Ending Illegal Discrimination And Restoring Merit-Based Opportunity' and 'Ending Radical And Wasteful Government DEI Programs and Preferencing.'
That executive order prompted companies around the United States to roll back their own diversity, equity and inclusion initiatives. But the details of Trump's order and what it's actually implementing are still murky.
I'm Haya Panjwani. On this episode of The Story Behind the AP Story, we speak with deputy global business editor Pia Sarkar and reporter Alexandra Olson.
Firstly, Alexandra, what is DEI or diversity, equity and inclusion?
ALEXANDRA OLSON, reporter: It's not a specific policy. It is an idea that you want to make your workplace or your school or any number of institutions inclusive and diverse and welcoming to a diverse population. I think companies over time have evolved to become more deliberate in these efforts.
Some of the first waves of what people think of as modern-day DEI initiatives started in the wake of the civil rights movement. Part of the Civil Rights Act is ensuring that your workplace is an equal opportunity employer and does not discriminate. Some of the policies that companies had to institute involved compliance with those laws. And over time, you saw some prominent companies also institute an employment resource group for black employees or LGBTQ employees. Some of these companies started these groups in the '80s, even.
PANJWANI: The Trump administration's executive order moved to end affirmative action in federal contracting and directed that all federal diversity, equity and inclusion staff be put on paid leave and eventually laid off. Some businesses reacted.
OLSON: Businesses have been rolling back their DEI initiatives or at least evaluating their DEI practices for many months now in response to conservative-led lawsuits that target some of these policies that they claim are discriminatory. But this review has taken on more urgency in response to the election of President Trump, and even more recently, his executive orders aimed at ending DEI-related policies both in the federal and private sectors.
PIA SARKAR, editor: And businesses are also rolling back DEI initiatives.
PANJWANI: That's Pia Sarkar, deputy global business editor.
You saw a lot more of them starting to join the movement of sorts. First, it started off with a handful of companies like Tractor Supply and John Deere. They were kind of smaller companies, but still name brands. But then suddenly you started to see much bigger companies also jumping in, including Walmart and McDonald's. And those are much bigger employers. And their rollback of some of these policies are much more impactful and may influence even bar companies to do the same.
OLSON: Trump's executive orders were both very aggressive and at the same time not specific about what constitutes what the government is calling illegal or discriminatory. The orders did lay out the intention to harness the enforcement power of the federal government of the day against these policies. And that's what has gotten a lot of people's attention. For example, the executive order threatens to impose financial sanctions on federal contractors deemed to have illegal DEI programs under new contracts. Federal contractors have to have a clause stating that they do not engage in discriminatory DEI programs. If they are found to be in violation of that, they could be subject to massive damages under the 1863 False Claims Act.
PANJWANI: What's being rolled back at companies varies.
OLSON: Very few companies have gotten rid of everything that falls under their DEI buckets. What they're trying to do is figure out which DEI practices or programs or policies could eventually be deemed illegal by a court responding to a lawsuit or by the federal government under these new Trump executive orders.
One practice that has been prominently challenged is tying executive compensation to promoting diversity. What the argument is from the conservative side is that this kind of practice can pressure hiring managers to make decisions on who to hire and who to promote and who even to let go based on race. So it's important to note that it is illegal under Title VII of the civil rights law to take race into account in hiring or promotion decisions. And prominent companies that have long promoted their DEI efforts say they do not do that.
SARKAR: And some of the other DEI practices that are worth noting are a little bit more open-ended. If a company was sponsoring a pride event, for instance, some have pulled back on how much sponsorship they're going to give. Some of those events, I think, Walmart, for instance, said that it was not going to renew its equity racial center that it set up in 2020 after the killing of George Floyd. And that was a five-year commitment, and it is not renewing it.
PANJWANI: Consumers are reacting differently than they have in the past.
SARKAR: So some are reacting to the rollback of the initiative initiatives a little bit more, at least from what I could see, in a more muted way than some of the protests that you saw, like, after George Floyd there was a huge demand for these kind of programs in 2020 and afterwards, in terms of people boycotting these companies because they're rolling back the initiatives, you don't see as much of that. There was a boycott that had been planned against, I believe, Target. There was a lot of pressure on social media, specifically from conservative activist Robby Starbuck, going after companies that were promoting DEI. And so that had raised a lot of social media backlash and calls for boycotts. Those boycotts never seem to have taken place, but the companies reacted to the threat of a boycott, in some cases by rolling back their DEI initiatives. And those rollbacks of the DEI initiatives haven't really led to more boycotts.
It seems like because so many companies have gone in this direction, it almost is starting to feel like it's becoming more the norm than the exception. You're only hearing about the companies that are rolling back their DEI policies, right? We're not hearing from companies who are keeping them in place except for Apple and Costco and Microsoft. But there could be a lot more that just aren't saying anything at all.
PANJWANI: Now what exactly is the confusion?
OLSON: The confusion is what is illegal. What is illegal discrimination or preference? The trouble is that DEI can constitute such a wide range, a wide range of programs, that nobody is quite sure whether their policies and practices and programs that they've had in place in some cases for many years, in some cases maybe even decades. Whether these are in fact illegal or not. There's been a few hints of, of backlash or of people protesting that some of this anti-gay effort has gone too far.
So we saw that, for example, when some government institutions or museums decided to stop celebrating Black History Month or Holocaust Remembrance Day. There's some indication that the government is trying to clarify that that is not what they're after. That speaks to the confusion, because these executive orders are so wide-ranging that nobody knows exactly what they are trying to target and what they are not. But it also speaks to a certain sensitivity that the anti-drag campaign might also go too far.
I think there's also a danger for these companies. They want to make sure that they don't go so far as to dismantle policies that are geared towards ensuring that they comply with anti-discrimination laws.
SARKAR: And I think there is also some caution around letting this issue go up to the Supreme Court, considering that it's a conservative Supreme Court right now in terms of whether or not there will be the pendulum swing back.
It is worth noting that a lot of these companies that are rolling back their DEI programs are also making it a point to say, we still care about these issues. We're not pulling back completely. So it kind of feels like they want to keep one foot in the door still. And I don't know if that's because the pendulum might swing back. So kind of playing it both ways might be the best way to approach it right now, just in case it does go the other way.
But right now, it doesn't look like that's going to happen in the foreseeable future.