New York State Legislature Passes Amendment to the New York Retail Worker Safety Act
Although later than anticipated, the New York State Legislature has just passed an amendment to the New York Retail Worker Safety Act (S8358C/A8947C, Chapter 308) that would extend the effective date of the act’s workplace violence prevention policy, training, and notice provisions from March 4, 2025, to June 2, 2025.
While this amendment (S740/A1678) still needs to be presented to Governor Kathy Hochul to be signed into law, employers that are preparing for compliance can take note of the changes.
Quick Hits
The New York State Legislature has passed an amendment to the New York Retail Worker Safety Act that extends the effective date for workplace violence prevention policies, training, and notice provisions from March 4, 2025, to June 2, 2025.
The amendment requires employers with 500 or more retail employees statewide toprovide “silent response buttons” (SRBs) for internal alerts, adjusts training requirements for smaller employers, and mandates state model templates in multiple languages. (The effective date of the SRB requirement is still January 1, 2027.)
The amendment also modifies the following other provisions of the act:
“Panic Buttons” that would alert law enforcement are now replaced with “silent response buttons” (SRBs) that alert internal staff (security officers, managers, or supervisors).
SRBs are now required for employers with 500 or more retail employees statewide rather than nationwide.
Employers with fewer than fifty retail employees now only need to provide workplace violence training to their retail employees upon hire, and then every other year, rather than annually.
New York State model templates will now be issued in English and the twelve most common non-English languages spoken in New York (as determined by data published by the United States Census Bureau).
With the previous effective date right around the corner, this amendment, along with the extension to the compliance date to June 2, 2025, can be a breath of fresh air for employers still working on their workplace violence policies and training programs. The amendment has not changed the effective date for the SRB requirement, which remains January 1, 2027.
Because Governor Hochul was actively involved in advancing the Retail Worker Safety Act and its amendment, it is anticipated that she will sign the amendment into law.
FY 2026 H-1B Cap Lottery Alert: Registration Period and Important Changes to USCIS Online System
U.S. Citizenship and Immigration Services (USCIS) has announced that the fiscal year (FY) 2026 H-1B cap registration period will open at noon ET on Friday, March 7, 2025, and will remain open until noon ET on Monday, March 24, 2025.
Quick Hits
The fiscal year 2026 H-1B cap registration period will open at noon ET on Friday, March 7, 2025, and will remain open until noon ET on Monday, March 24, 2025.
Prospective cap-subject H-1B petitioners and their representatives must use a USCIS organizational account online to register beneficiaries and pay required fees.
USCIS’s new H-1B registration fee of $215 per registration will be in effect for this year’s H-1B cap season.
USCIS announced enhancements to the organizational account system to improve functionality for paralegals, legal representatives, and those preparing Forms I-129 online.
Similar to last year’s registration process, prospective petitioners and their legal representatives must use a USCIS organizational account online to register beneficiaries and pay registration fees.
This year brings USCIS’s higher registration fee requirement of $215 per registration, originally announced by USCIS in January 2024. In light of H-1B cap registration volume and higher fees, the U.S. Department of the Treasury increased its daily credit card transaction limit from $24,999.99 to $99,999.99 per day.
USCIS will again use the beneficiary-centric selection process originally launched in FY 2025. Through this process, registrations will be randomly selected by unique beneficiary rather than by registration. USCIS intends to start releasing lottery results by March 31, 2025.
USCIS reminded stakeholders that petitioning employers must create an organizational account through their online system if they did not create an account during the FY 2025 H-1B cap registration process. Additionally, while legal representatives may add company clients to their accounts at any time, it will not be possible to create H-1B cap registrations until the registration period opens on March 7, 2025.
USCIS also announced enhancements to the organizational account system it launched last year, including the following:
The ability for a paralegal to work with more than one legal representative. This will allow a paralegal account to prepare H-1B registrations, H-1B petitions, and requests for premium processing for multiple attorneys (representatives) within the legal team organizational account.
An easier process for legal representatives to add paralegals to different company clients.
The ability to upload a spreadsheet of H-1B beneficiary data into the system, allowing for that data to prepopulate into H-1B registrations.
Prepopulation of some data from an H-1B registration into fields within Form I-129 (if prepared online).
Key Takeaways
Launched in 2024, USCIS’s successful organizational account system and beneficiary-centric selection process are here to stay in the FY 2026 H-1B cap registration lottery, and USCIS has already announced online system improvements based on feedback last year from petitioners and legal representatives. Employers may want to mark their calendars with this year’s dates and check their USCIS online account access as they prepare for this year’s H-1B cap season.
H-1B Cap Update: USCIS Announces FY2026 H-1B Cap Registration Period and Massive Fee Hike
The H-1B cap season for Fiscal Year 2026 is quickly approaching. USCIS announced on Feb. 5, 2025, that the registration period for FY 2026 will open at noon (EST) on Friday, March 7, 2025, and close at noon (EST) on Monday, March 24, 2025, and that the registration fee will go up significantly. Employers should begin evaluating their hiring needs and decide if they plan to sponsor foreign workers for H-1B classification this year.
H-1B Cap Registration Process
During the H-1B cap registration period, prospective petitioners and their representatives must use a USCIS online account to electronically register each beneficiary for the selection process and pay the associated registration fee. This year, the FY 2026 H-1B cap registration fee will increase from $10 to $215 per registration.
The H-1B visa is intended for foreign workers in specialty occupations — jobs that require at least a bachelor’s degree (or equivalent) in a specific field. Examples of specialty occupations include careers in architecture, engineering, medicine and health, accounting, and law. Additionally, H-1B beneficiaries must possess the necessary educational credentials for the position.
Eligible H-1B beneficiaries may include recent foreign student graduates present in the United States in F-1 student status and any other foreign professional whether in the United States or abroad.
H-1B Visa Caps
The a statutory cap is 65,000 H-1B visas (regular cap), with an additional 20,000 visas for foreign professionals with an advanced degree from a U.S. academic institution (master’s cap). If USCIS receives more registrations than H-1B visa numbers available, it conducts a random lottery to select the registrants who may be the beneficiary of an H-1B petition. Those selected are notified and provided instructions on where and when to file the H-1B petition. The employer then may file an H-1B petition for each selected worker.
The earliest possible date to request H-1B status in the petition is Oct. 1, 2025, which is the start of federal FY 2026.
Continued Beneficiary-Centric Selection Process
This year, USCIS will continue its beneficiary-centric selection process introduced last year. This approach has helped reduce attempts to gain an unfair advantage in the system and minimized duplicate registrations on behalf of beneficiaries, improving the overall registration and selection process.
In FY 2023, USCIS received 483,927 H-1B registrations, including 165,180 registrations for beneficiaries with multiple entries.
In FY 2024, the number of registrations surged to 780,884, with 408,891 multiple registrations.
In FY 2025, USCIS received 479,953 H-1B registrations, with 47,314 instances of multiple registrations, significantly lower than the previous year.
Preparing for Filing Season
Employers should start preparing for the upcoming H-1B cap filing season by identifying potential candidates for H-1B classification, drafting job descriptions, and determining salary offerings. Taking these steps now will allow for a timely review of each candidate’s eligibility and ensure they are registered within the designated timeframe.
H-1B Modernization Rule
The H-1B Modernization Rule, implemented on Jan. 17, 2025, is still in effect. Introduced under the Biden Administration, the rule offers greater flexibility for employers and foreign workers by modernizing the criteria for specialty occupations, expanding the definition of nonprofit and government research organizations for H-1B cap exemption purposes, and extending the cap-gap period for F-1 visa holders. Even though one of President Donald Trump’s executive orders revoked 78 Biden executive orders, a reversal of this rule would require a formal rulemaking process because this rule was codified in the Code of Federal Regulations. A reversal of the H-1B Modernization Rule, if and when a formal rulemaking process is completed, would be expected to: (1) re-define specialty occupation; (2) increase wage requirements; (3) prioritize H-1B cap registration based on compensation levels; and (4) eliminate deference.
Another Arbitration Agreement Bites the Dust!
The California Court of Appeal dealt another blow to arbitration, just months after we reported the last such decision here.
This time, the Court ruled that the federal Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021 (“EFAA”) overrides state law—even in cases in which the employee has signed an arbitration agreement that explicitly invokes state law favoring arbitration.
Kristin Casey, a former employee of D.R. Horton, Inc., sued the company and one of its employees, Kris Hansen, for sexual harassment, sex discrimination, retaliation, and failure to prevent discrimination and harassment in September 2023. D.R. Horton attempted to enforce an arbitration agreement in Casey’s employment contract, which included a choice-of-law provision applying California law. Casey opposed arbitration, arguing that the EFAA gave her the right to pursue her claims in court.
The EFAA, enacted in 2022, provides that a “person alleging conduct constituting a sexual harassment dispute” may elect that “no predispute arbitration agreement . . . shall be valid or enforceable with respect to the case filed under federal, tribal or state law and relates to the sexual harassment dispute.”
The trial court upheld the arbitration agreement, enforcing the terms to which Casey had agreed. But on a writ petition, the California Court of Appeal reversed, holding that the EFAA preempts state law so long as the employment relationship involves interstate commerce (a low hurdle). The court further determined that an employer cannot rely on a choice-of-law clause to avoid the effect of the EFAA.
You can read the full decision here.
Illinois Employers: Navigating New E-Verify and I-9 Compliance Requirements
Effective January 1, 2025, Illinois employers face updated regulations under Public Act 103-0879, altering the landscape of E-Verify and Form I-9 compliance. This law applies to companies located in Illinois and any employer with employees working in Illinois, regardless of where the company is headquartered. It does not extend to employees working outside of Illinois for an Illinois-based company. The Illinois Department of Labor has clarified that the law does not prohibit private employers from using E-Verify. However, it does reaffirm current federal E-Verify requirements and impose several additional obligations to protect workers and ensure fair practices.
Key Compliance Updates:
Expanded Employee Protections:
Employers must notify employees when their work eligibility or documentation is questioned.
Employers are required to inform the entire workforce in case of a federal I-9 audit.
Prohibited Practices:
E-Verify cannot be used to prescreen applicants.
Employers cannot act on tentative non-confirmations without following federal procedures.
Employers must follow specific state and federal guidelines if they receive tentative non-confirmation notifications to ensure fair treatment and due process for all their employees.
State Penalties for Non-Compliance:
Violations of the law may lead to penalties, emphasizing the importance of strict adherence.
Conclusion:
Contrary to some misconceptions, the law does not prevent private employers from using E-Verify. Rather, it regulates its use to uphold anti-discrimination policies, safeguard worker rights, and protect businesses. A number of the law’s provisions mirror those that have always been part of the E-Verify program, but employers (especially those in Illinois or with employees working in Illinois) should review their practices to ensure compliance with the state and federal requirements.
What to Know About the War Being Waged Against DEI
Can you still have DEI (diversity, equity, and inclusion) programs? How about affirmative action plans? The Supreme Court’s June 2023 decision in Students for Fair Admissions v. Harvard garnered national attention in holding that Harvard’s admissions program, which used race as a factor in admissions, violated the Equal Protection Clause of the 14th Amendment. Since then, major private corporations have made headlines with their decisions to scale back certain DEI initiatives. Other private companies, such as Costco and Apple, remain unwavering in their commitment to DEI. While not without legal risk, companies that have found DEI initiatives to be helpful to their business and culture can continue with their programs.
State Attorneys General Weigh In
In a recent letter, 13 Democratic attorney generals (from California, Connecticut, Hawaii, Illinois, Maine, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, New York, Rhode Island, and Vermont) urged one retail giant to reconsider its scale back of DEI programs. The AGs’ letter reminded the retail giant that the Fair Admissions decision is a narrow ruling and does not prohibit private corporations from implementing DEI initiatives. The letter went on to remind the company that DEI initiatives are not only encouraged and beneficial but are in some cases necessary to comply with certain states’ anti-discrimination laws.
The New Administration Weighs In
President Trump’s recent executive order titled “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” has made the future of DEI even more perilous. The executive order rescinded Executive Order 11246, a 1965 order that imposed affirmative action requirements on federal contractors. Additionally, the federal government has placed DEI employees on paid leave and ordered the termination of DEI activities within federal agencies. The recent executive order goes on to demand that the attorney general submit “recommendations for enforcing Federal civil-rights laws and taking other appropriate measures to encourage the private sector to end illegal discrimination and preferences, including DEI.”
Avoiding Legal Risks in Continued DEI Efforts
If you want to continue DEI efforts, do so thoughtfully and recognize the risks. The recent executive orders emphasize the idea of restoring merit to employment decisions. Therefore, your DEI measures should ensure that programs continue to be merit-based and are designed to provide equal access to opportunities for all applicants and employees. The executive order does not define the specific DEI programs or activities it deems to be illegal, however policies such as quotas, hiring preferences, or hiring goals are likely more susceptible to claims of discrimination. You should review any of your existing company policies and initiatives to ensure they comply with state and federal anti-discrimination laws, as well as recent executive actions.
In the aftermath of the Fair Admissions decision, the EEOC stated “[i]t remains lawful for employers to implement diversity, equity, inclusion, and accessibility programs that seek to ensure workers of all backgrounds are afforded equal opportunity in the workplace.” Due to recent executive actions, we may get additional guidance from the EEOC on the topic of DEI.
Before you make a decision to change an existing workplace DEI initiative or to implement a new initiative, you should consult with your legal counsel to ensure compliance with state and federal anti-discrimination laws. Be on the lookout for developments in this space, as the president’s recent executive actions will likely face legal challenges so the landscape could change.
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Employer Reminder: Ontario Election 2025—Employees’ Right to Time Off to Vote Under the Election Act
On January 28, 2025, Ontario Premier Doug Ford requested that Lieutenant Governor Edith Dumont dissolve Ontario’s Legislative Assembly, triggering an election for Ontarians to elect Members of Provincial Parliament. That election is due to be held on February 27, 2025.
Quick Hits
Premier Doug Ford has called for an Ontario provincial election to be held on February 27, 2025, requiring employers to provide eligible employees with three consecutive hours of paid time off to vote if their work schedules do not already allow for it.
Employees must be Canadian citizens, eighteen years of age or older, and residents of Ontario to be eligible for voting time off. An employer can choose when the three hours are taken if an employee qualifies.
Employers must grant job-protected leave for employees volunteering as poll officials with proper notice, and failure to comply with these provisions can result in significant fines or imprisonment.
Employers must give eligible employees three consecutive hours of paid time off in order to vote while polls are open. This right is provided in Ontario’s Election Act, unlike most leaves of absence provided for employees in Ontario’s Employment Standards Act, 2000.
To be eligible for the three hours, an employee must be eligible to vote. This means the employee must be a Canadian citizen, eighteen years of age or older, and reside in the Province of Ontario.
An employee is not eligible to receive time off to vote if the employee already has three consecutive hours off outside of working hours. Polls will be open from 9:00 a.m. to 9:00 p.m. (EST), and 8:00 a.m. to 8:00 p.m. (CST) on election day. This means that if an employee works from 9:00 a.m. to 5:00 p.m. on election day, the employee will have three consecutive hours available after his or her working hours and will not be entitled to the time off. On the other hand, an employee working a ten-hour shift from 10:00 a.m. to 8:00 p.m. on election day would not have three consecutive hours available outside of working hours and would be eligible for three hours of paid time off.
Where an employee is eligible for time off, the employer may choose when the three consecutive hours are taken.
When an employee volunteers as a poll official for Elections Ontario, and the employee requests a leave of absence with at least seven days’ notice to the employer, the employer must grant the employee job-protected leave to perform his or her poll official duties under the Election Act. An employer is prohibited from dismissing or disciplining an employee who elects to take this leave. While an employer is not required to compensate an employee for the time taken for a leave relating to poll official duties, such a leave must not be deducted from an employee’s vacation entitlement.
Where an employer denies an eligible employee the three consecutive hours of time off to vote or infringes an individual’s right to serve as a poll official, the employer may face a fine of up to $5,000 for contravening the Election Act. If a judge determines that this denial was done knowingly, a person may be liable for a fine up to $25,000, or imprisonment for up to two years less a day.
DHS Rescinds Recent Temporary Protected Status Extension for Venezuela
On Jan. 28, 2025, the Trump administration, acting through its Secretary of the Department of Homeland Security (DHS), revoked the extension of Temporary Protected Status (TPS) for Venezuelans residing in the United States. This decision reverses the 18-month extension granted Jan. 17, 2025, under the Biden administration. The revocation of TPS for Venezuelans means that the protections set to last until October 2026 will now revert to their prior expiration dates and TPS beneficiaries, who have already applied or intended to re-register, will no longer benefit from the extension. Instead, the 2023 Venezuela TPS designation remains valid for current beneficiaries through April 2, 2025, and the 2021 Venezuela TPS designation remains valid for current beneficiaries through Sept. 10, 2025.
DHS grants TPS to eligible individuals from countries experiencing ongoing armed conflict, environmental disasters, or other extraordinary conditions, which allows them to live and work in the United States without fear of deportation.
Employees with Venezuela TPS may have work authorization through either facially valid documents or automatic extensions. Employers should assess each employee’s work authorization on a case-by-case basis. The first Trump administration attempted to terminate several TPS designations, leading to court challenges, and this most recent revocation of TPS may similarly face legal challenges.
Does an Arbitration Agreement Require the Employer’s Signature? Read the Fine Print
The California Court of Appeal recently reminded employers in an unpublished (but nonetheless chastening) opinion of the importance of carefully drafting arbitration agreements. In Pich v. LaserAway, LLC et al, the court affirmed the trial court’s denial of the employer’s motion to compel a former employee’s representative wage-and-hour suit to arbitration because the arbitration agreement in question was signed only by the employee—not the employer.
While acknowledging that California courts have recognized that arbitration agreements bearing only the employee’s signature without a corresponding signature from the employer can still be valid, the Court found that, in this case, the plain text of the arbitration agreement required a signature from both parties to be effective.
For example, the arbitration agreement contained lines such as: “The Company and I understand and agree that, by signing this Agreement, we are expressly waiving any and all rights to a trial before a judge and/or a jury,” and “[t]he parties acknowledge and agree that each has read this agreement carefully and understand that by signing it, each is waiving all rights to a trial or hearing before a judge or jury of any and all disputes and claims subject to arbitration under this agreement.” (Italics added.)
Therefore, the Court found that the agreement by its own terms required a signature from the employer to be valid and, lacking one, never took effect and never became a valid agreement to arbitrate.
Although this decision is unpublished and therefore noncitable, it is still an important reminder to employers to think carefully when drafting arbitration agreements. As we have covered, California courts are often eager to find weak spots that can provide an excuse to deny arbitration.
Breaking: NLRB Drops Opposition to SpaceX’s Constitutionality Arguments
On February 3, 2025, the National Labor Relations Board (“NLRB” or the “Board”) filed a letter with the U.S. Court of Appeals for the Fifth Circuit on Space Exploration Technologies Corp. v. NLRB, Consolidated Case No. 24-50627, et al., indicating that it would not address constitutionality arguments raised in SpaceX’s brief. As reported here, those arguments were as follows:
The NLRB’s structure is unconstitutional in that it limits the removal of NLRB Administrative Law Judges (“ALJs”) and Board Members, and permits Board Members to exercise executive, legislative, and judicial power in the same administrative proceeding; and
The Board’s new expanded remedies violate employers’ Seventh Amendment right to a trial-by-jury.
The Board’s position follows President Trump’s firing of Board Member Gwynne A. Wilcox, which set up a constitutional battle over the President’s removal power under Section 3(a) of the NLRA. As discussed here, that move left the Board without a quorum, which the Board indicated prevents it from “review[ing] ALJ recommended findings and orders” in the underlying unfair labor practice proceeding at issue in the SpaceX case.
While neither constitutional argument raised by SpaceX is directly implicated by Member Wilcox’s firing, the Board indicated in its letter that “[i]n light of these executive actions, Board counsel is not in a position to address the Board-member-removability arguments raised in the government’s briefs.” However, Board counsel will still argue that the injunctions—halting the merits of the SpaceX case until the constitutionality arguments are resolved—should be reversed. It remains to be seen whether interested parties will take up the defense against these constitutionality arguments in the Board’s stead.
The Department of Labor (DOL) Adopts Self-Correction for Common Retirement Plan Fiduciary Breaches
For the first time since the DOL adopted its Voluntary Fiduciary Correction Program (VFC Program) in 2002, retirement plan sponsors will be able to utilize self–correction as an efficient means to correct their most frequent compliance failures – late transmittals of participant retirement plan contributions and retirement plan loan repayments.
The DOL finalized an update to its VFC Program adding the Self-Correction Component (SCC) for these fiduciary failures and, additionally, finalized an amendment to an existing prohibited transaction exemption (PTE) that provides excise tax relief for transactions that have been self-corrected.
The SCC feature and excise tax relief become effective on March 17, 2025.
The VFC Program –Section 409 of the Employee Retirement Income Security Act of 1974, as amended (ERISA), provides that retirement plan fiduciaries who breach the responsibilities, obligations or duties imposed on them may be personally liable for any plan losses resulting from such breach, and may be required to restore any profits to the plan that may have been made through the use of the plan’s assets.
The VFC Program aims to encourage plan sponsors to voluntarily correct breaches of certain fiduciary obligations under ERISA in return for relief from civil enforcement actions and, in some cases, penalties for breaches. To participate, plan sponsors must fully correct errors in accordance with procedures specified in the VFC Program and file an application with the DOL. The application submission requires a description of the breach and the corrective action taken, documentary proof of the corrective action and other specified information.
The VFC Program application process can be quite onerous and, in some cases, is akin to a DOL audit. As a result, some plan sponsors have been reluctant to use it and, instead, have corrected fiduciary breaches on their own.
Self-Correction Component –The new SCC option permits plan sponsors to correct eligible transactions without filing a VFC Program application. Moreover, when a plan sponsor utilizes the SCC, the updated VFC Program waives the existing requirement that plan sponsors notify plan participants and other interested persons of prohibited transactions, as well as the steps taken to correct them.
The SCC option, however, does require the self-corrector to electronically submit a SCC Notice using the new online DOL VFC Program web tool that includes the following information:
Self-corrector’s name and address;
Plan name;
Plan sponsor’s Employment Identification Number;
Principal amount;
Amount of lost earnings and the date paid to the plan;
Loss date; and
Number of participants affected by the correction.
After filing this notice, the plan sponsor will receive an email acknowledgment from DOL, but will not receive the “no action” letter that typically is received upon DOL’s approval of VFC Program application. The plan administrator is required to retain a “penalties of perjury” certification, and other documentation related to the correction. The “penalty of perjury” certificate must state that the plan is not under investigation and acknowledge receipt and review of the SCC notice. A plan fiduciary is required to sign and date the “penalties of perjury” certificate.
In order to be eligible for self-correction:
The lost earnings resulting from the delinquent contributions cannot exceed US$1,000;
Delinquent payments, including lost earnings, must be remitted to the plan within 180 days of the date payments are withheld from participants’ paychecks or received by the employer;
Neither the plan nor the self-corrector may be under investigation; and
Penalties, late fees and other charges related to the delinquent contributions must be paid.
Excise tax relief –In conjunction with the VFC Program update, the DOL amended PTE 2002-51 to expand excise tax relief to prohibited transactions eligible for self-correction under the updated VFC Program. The amendment provides relief from the 15 percent excise tax that DOL otherwise imposed when participant contributions and loan repayments are not timely remitted to a 401(k) plan. Relief is available if the plan receives an acknowledgment of self-correction from DOL and complies with other requirements of the VFC Program. Instead of paying the excise tax, the plan sponsor must contribute the amount equal to the excise tax to the self-corrected plan.
Excise tax relief will be available regardless of whether the plan has utilized the VFC Program or PTE 2002-51 in the past. Prior to this amendment, PTE 2002-51 generally was not available to plans that had utilized the VFC Program or the PTE for a similar type of transaction within the previous three years.
Additional Items to Note
The VFC Program update clarifies the existing transactions eligible for correction, expands the scope of certain transactions currently eligible for correction and simplifies certain administrative and procedural requirements for VFC Program participation and corrections. Notably, correction through the VFC Program does not relieve plans from reporting late participant contributions on Form 5500 or 5500-SF. Neither the update to the VFC Program nor the PTE amendment changes this reporting requirement.
The DEI Whirlwind Continues – New Lawsuit Challenges Constitutionality of Anti-DEI Orders
On Monday, February 3, a group of organizations, including representatives of university diversity officers, sued President Trump and his administration, seeking to halt and declare unconstitutional two executive orders aimed at ending diversity, equity, and inclusion (DEI) programs. The lawsuit, filed in the U.S. District Court of the District of Maryland, challenges Trump’s orders as exceeding his constitutional authority and violating principals of equality.
These executive orders from the first week of Trump’s presidency target DEI programs within the federal government and institutions that receive federal funding. One challenged order aims to eliminate DEI offices and positions in the federal government. The other order seeks to deter publicly traded corporations, universities, and other large entities from supporting diversity initiatives.
The plaintiffs are the National Association of Diversity Officers in Higher Education, the American Association of University Professors, the Restaurant Opportunities Center United, and Baltimore’s mayor and city council. They argue that the executive orders undermine efforts to correct historical discrimination against women, racial minorities, and LGBTQ individuals.
In their complaint, the plaintiffs allege that these executive orders:
Exceed President Trump’s constitutional authority, infringing on the spending power, which the Constitution grants exclusively to Congress, by threatening economic sanctions for those who advocate equality and inclusion;
Violate the separation of powers enshrined in the Constitution;
Are unconstitutionally vague, meaning they fail to provide a person with fair notice of what is prohibited in violation of the Fifth Amendment; and
Violate the First Amendment Free Speech Clause by creating a chilling effect on expression or participation in anything that might be related to DEI.
The plaintiffs seek both preliminary and permanent injunctions to block the orders, as well as a declaration that both executive orders are unlawful and unconstitutional.
This lawsuit evidences ongoing debates over the role of DEI programs in addressing inequality. Those challenging the orders argue that DEI programs are necessary to correct long-standing disparities. Those in favor of eliminating DEI programs contend that such programs unfairly disadvantage other applicants. As this challenge to President Trump’s anti-DEI orders unfolds, it will have significant implications for the future of diversity efforts in both the public and private sectors.
Employers and universities alike should work with outside counsel to ensure they are compliant with applicable law and assess organizational risk where appropriate.