The recent federal government executive actions and related activities have had wide ranging impacts on not only recipients of federal funds, but even on organizations that receive no federal funding. How these executive actions will be implemented still remains unclear, in light of various legal challenges and changing information from agencies.
This article seeks to provide some practical guidance on how to prepare for potential federal actions. Below are a few actions you may want to consider to help prepare for the unexpected:
01. Review Termination Provisions
If you receive federal funds directly or indirectly (for example, via state agencies using funds that originate with the federal government), consider reviewing your contracts for termination rights and provisions. If any of the work being funding falls under the broad umbrella of DEI, these could fall within the scope of executive orders directing the termination of federal funds for such activities.
02. Contact your Contracting Officer
If you have federal contracts, consider reaching out to your contracting officer about potential changes to FAR (Federal Acquisition Regulations) clauses or other requirements that may impact your contractual obligations. While recent EOs have included proposed FAR revisions, it is not clear how or when they will be implemented in federal contracts. Staying in close communication with your contracting officer may help you anticipate any changes.
03. Evaluate your employment practices
Consider evaluating your hiring and employment practices through the lens of non-discrimination and the recent executive orders. Many companies do not proactively practice affirmative action, but if you are federally-funded, you may have been required to do so in your contracts.
Also, some state requirements on non-discrimination are not aligned with newer federal policy and executive orders, so you may benefit from engaging with counsel to ensure compliance with both federal and state obligations.
04. Connect with your sector
If you operate in a sector that the administration has focused on, like the nonprofit sector or the environmental sector, consider engaging with peer organizations, coalitions or your relevant trade association to better understand what potential actions may be taken and if there are any joint efforts being made to comply with or challenge new rules. For nonprofit organizations, the National Council on Nonprofits has been a proactive resource by tracking EO-related developments and associated legal challenges.
05. Review your messaging
If you are a charitable organization, consider reviewing your mission and activities in light of recent executive orders and federal activities aimed at reducing support for “DEIA” (which is broadly defined). Many charitable organizations have missions that are aimed at achieving equity and helping underserved communities, some of which are aligned with the new administration’s goals and initiatives, but others are not.
If your mission could be viewed as not aligning with current policy goals, you may want to keep a close eye on how evolving policy might affect strategic planning and spending. You may also want to review your marketing and messaging to consider how it may affect reputational and other risks during these evolving times.
06. Update your programming
Consider reviewing your programming and online description of your activities through the lens of non-discrimination to help determine whether your programs could be viewed as discriminatory under current policies and interpretations. Many nonprofit programs are aimed at certain groups and communities, and it may be helpful to evaluate these activities to ensure that they are not engaging in illegal discrimination as described in recent executive orders.
07. Assess your global activities
If you implement programs outside the U.S., consider reviewing them in light of current “America First” policies and updated State Department priorities and activities. There are several agency memos and directives that may impact your engagement and funding of such foreign country programs. While it is unclear how these policies will be implemented, it may be helpful to be aware of any areas that may not align so that you can pivot or adjust as needed.
Final Thoughts
By taking proactive, practical steps now, companies and non-profit organizations can better position themselves to stay legally compliant and minimize disruption to their programs in this evolving legal landscape.
Lakshmi Sarma Ramani is a Partner on our Washington D.C.-based team. Lakshmi has over 20 years of significant transactional experience representing a wide range of for-profit and non-profit companies and handles a full range of legal matters, including data privacy and compliance.