On September 22, 2020, President Donald Trump issued Executive Order 13950: Combating Race and Sex Stereotyping. This order stopped federal agencies, federal grant recipients, and government contractors from conducting training in the workplace that involves “stereotyping” or “scapegoating” based on sex or race, specifically banning discussions of critical race theory and white privilege. The United States District Court for the Northern District of California issued a preliminary injunction on December 22, 2020, banning the enforcement of the order, and, on January 20, 2021, President Joe Biden, during his first day in office, revoked the order. However, this did not signify the end of Executive Order 13950’s importance. While this executive order is atypical because it utilizes government procurement as a vehicle to enact socially conservative policies, it continues the troubling trend of presidents using executive orders to regulate government contractors. This Note will first analyze three problems with the defunct executive order: (1) the executive order was bad policy; (2) it violated the United States Constitution; and (3) most importantly, the executive order itself is the wrong mechanism to enact social change and regulate government contractors. Second, this Note will explain that the rise and fall of Executive Order 13950 exemplifies the turbulent nature of regulating government contractors through executive orders. Instead of relying on such orders, government officials should regulate labor and employment requirements on government contractors through legislation because such measures are longer lasting, give interested parties the opportunity for input, and undergo more deliberate considerations before enactment.
Minimum wage. Workplace safety standards. Family and medical leave. These types of labor and employment policies affect all American employers and employees. In addition to the requirement that they comply with laws that affect all employers, government contractors also face additional labor and employment requirements. For example, former President Barack Obama issued multiple executive orders in this policy area, including Executive Order 13496: Notification of Employee Rights Under Federal Labor Laws, which requires federal contractors to notify employees of their rights under the National Labor Relations Act (NLRA).
Recently, with congressional gridlock, presidential administrations have found that the best way to bypass Congress and implement their policy agenda quickly is through executive orders. While enacting policies via executive order may have previously been considered progressive or even used “to advance conceptions of social justice,” the practice can sometimes be regressive because it permits the imposition of socially conservative policies to bypass Congress as well. A prime example is former President Trump’s Executive Order 13950: Combating Race and Sex Stereotyping, which prohibits government contractors from conducting workplace training that involves “stereotyping” or “scapegoating” based on sex or race, specifically banning discussions of critical race theory and white privilege. The implementation and eventual repeal of Executive Order 13950 exemplifies that executive orders are subject to change with each administration. If presidents want to enact lasting change, they must push Congress to pass their agenda. Government officials should regulate labor and employment requirements on government contractors through more enduring legislation, as opposed to executive orders, because legislation is longer lasting, gives interested parties the opportunity for input, and undergoes more deliberate considerations before enactment.
This Note will first address background issues associated with using government procurement to enact policy change, recent uses of executive orders to regulate government contractors, and the evolution of Executive Order 13950, which eventually ended in its repeal. Second, this Note will address three key points of analysis: (1) that Executive Order 13950 is a bad social policy, unconstitutional, and (2) represents the volatile nature of ruling through executive order; and (3) more importantly, why presidents should stop implementing their social policy agenda by placing requirements on government contractors. These social policies, particularly those enacted through executive orders, are too easily subjected to adjustments and revocations from subsequent presidential administrations to create enduring change. Instead, change should occur through traditional means of legislation, much like when Congress passed the Fair Chance to Compete for Jobs Act of 2019, which enacts a “[p]rohibition on criminal history inquiries prior to conditional offer for Federal employment.”
Government officials have many aims when procuring a government contract that extend beyond getting the best value—the government often “use[s] contracts to produce desired social policy outcomes through public procurement.” This “strategic” procurement “is geared towards achieving a social purpose such as environmental protection, energy conservation, assisting disadvantaged groups in the population, and the like.”
Government contractors’ obligations to achieve social goals have two main sources: (1) legislation, and (2) executive orders. In the past, government contractors have been regulated through federal statutes, enacted via lengthy processes. In a typical process, a representative or senator sponsors the legislation and then the Speaker of the House or Senate Presiding Officer assigns it to a committee to study. If the bill makes it out of the committee, it is then added to the calendar to be voted on or amended; it is ultimately voted on by the full chamber. The bill then goes to the opposite chamber (the House or the Senate) and must again pass by a majority. If one chamber edits the bill passed by the other chamber before passing it, a conference committee must work out any differences between the two versions of the bill, then must get final approval from both the House and the Senate. Finally, the president must sign the bill in order for it to be enacted into law. The bill may also become law if the president waits ten days without signing or vetoing it and Congress is still in session, or if the president vetoes the bill and Congress then overrides the veto.
In contrast, an executive order is a “signed, written, and published directive from the President of the United States . . . [and requires] no approval from Congress.” While both executive orders and legislation are used to implement social policy through regulations on government contractors, executive orders can easily change from administration to administration as “a sitting U.S. President may overturn an existing executive order by issuing another executive order to that effect.”
Lawmakers and presidential administrations have long used government contracts to implement labor and employment policies. As early as the 1840s, President Martin Van Buren issued executive orders relating to labor and employment policies; one such order established the ten-hour workday for certain government contractors. Since then, the federal government has continued to target government procurement with a myriad of policies to enact social change, including “to guard against substandard wages and working conditions.” Hence, when a company applies to be a federal government contractor, it knows that this means “complying with certain heightened labor and employment requirements.” However, the use of government contractor obligations to drive social policy seems to have “evolved rapidly over the past several years, driven by executive orders, rulemakings, and guidance from President Obama’s administration.”
The Obama and Trump administrations have both enacted labor and employment-based requirements for government contractors. Supporters argue that President Obama’s policies were used “to advance conceptions of social justice.” For example, President Obama signed Executive Order 13658: Establishing a Minimum Wage for Contractors, which raised the minimum wage to $10.10 per hour for certain types of federal contracts. Moreover, President Obama implemented Executive Order 13672: Fair Pay and Safe Workplaces, which expanded a previous federal order that prohibited race, color, religion, sex, and national origin discrimination by government contractors to also prohibit discrimination on the basis of gender identity or sexual orientation. Another Obama administration policy was Executive Order 13655: Non-Retaliation for Disclosure of Compensation Information, which mandates that government contractors and subcontractors cannot put into effect any rule that “bans or tends to prohibit” employees from discussing or disclosing workers compensation. These executive orders represent only a few examples among many.
When President Trump entered office in 2016, however, he immediately began rolling back Obama-era executive orders, including those implementing labor and employment policies for government contractors. In 2017, the Congressional Review Act was used to revoke President Obama’s Executive Order 13673. President Trump has also revoked Obama-era executive orders by signing executive orders of his own. For example, in 2019, President Trump signed Executive Order 13897: Executive Order on Improving Federal Contractor Operations by Revoking Executive Order 13495. Executive Order 13495, implemented by President Obama, allowed for a new government contractor that takes over an existing contract to offer existing employees a chance to continuing work on the project. Just as easily as former President Obama enacted the executive order, newly elected President Trump revoked the executive order “to promote economy and efficiency in Federal Government procurement.” Trump’s revocation went into effect immediately.
President Trump, like President Obama, also issued new orders to guide labor and employment policy. One such policy issued by President Trump is Executive Order 13950: Combating Race and Sex Stereotyping, which will be the focus of the next section of this Note.
Executive Order 13950: Combating Race and Sex Stereotyping, was a recent and exceedingly controversial executive order mandating an employment policy. This executive order banned “diversity training that includes ‘divisive concepts’ such as the idea that the U.S. is inherently sexist or racist, or that individuals may be ‘inherently racist, sexist, or oppressive, whether consciously or unconsciously.’” The executive order further prohibited “race or sex scapegoating,” which means “assigning fault, blame, or bias to a race or sex, or to members of a race or sex because of their race or sex,” and “encompasses any claim that, consciously or unconsciously, and by virtue of his or her race or sex, members of any race are inherently racist or are inherently inclined to oppress others, or that members of a sex are inherently sexist or inclined to oppress others.” Topics potentially banned included discussions on white privilege and critical race theory.
Former Director of the Office of Management and Budget Russ Vought said that “[r]equiring or pressuring employees to attend trainings where they are told they are inherently racist is un-American.” The executive order “direct[ed] ‘all government contracting agencies’ to insert a clause prohibiting such trainings in all prime contracts” starting on November 21, 2020. If that policy was violated, the executive order entitled the Office of Federal Contract Compliance Programs (OFCCP) to terminate or suspend contracting companies that were not in compliance. Contractors could have faced additional “[p]enalties for non-compliance [including] contract suspension or cancellation, or debarment, as well as [an] investigation by the Attorney General for Title VII violations.”
There was much uncertainty surrounding Executive Order 13950. First, the text of the executive order did not explain whether diversity trainings could continue in departments of a company that did not have a government contract, meaning contractors were unsure whether to “assume that the Order applies enterprise-wide.” Furthermore, this executive order greatly impacted federal contractors as they were afraid they had to change current trainings because “[a]ffirmative action-related training, as well as any training that references acknowledging and accommodating differences, may be impermissible.” Trainings that reference systemic discrimination or certain microaggressions also may not have been permissible. In summary, “federal contractors [were] unsure of what they [could] say about race.” In fact, “[m]ore than 300 events, training programs, research projects and other diversity-related activities [were] delayed or canceled because of concern about the new executive order.”
Several trade associations spoke out about this executive order, including the American Academy of Social Work and Social Welfare, the Internet Association, and the American Association of Colleges of Pharmacy. Additionally, the Santa Cruz Lesbian and Gay Center filed a lawsuit in the U.S. District Court for the Northern District of California against then-President Donald Trump asking for a preliminary injection that would ban the enforcement of two sections of Executive Order 13950—Sections 4 and Section 5.
Plaintiffs argued two points: (1) the executive order violated the First Amendment’s guarantee of freedom of speech by chilling speech based on its viewpoint and content; and (2) plaintiffs asserted that the executive order violated the Fifth Amendment’s Due Process Clause because it was too vague; the Court ultimately found “[the executive order] infringe[d] on the plaintiffs’ constitutionally protected right to free speech and provides inadequate notice of the conduct it purports to prohibit.” On December 22, 2020, the court held that a nationwide preliminary injunction was warranted under both the Free Speech Clause of the First Amendment and the Due Process Clause of the Fifth Amendment.
After the decision, the Department of Labor posted on the Executive Order 13950 webpage that:
United States District Court for the Northern District of California issued a preliminary injunction prohibiting OFCCP from implementing, enforcing, or effectuating Section 4 of Executive Order 13950 ‘in any manner against any recipient of federal funding by way of contract [or] subcontract . . .’ This preliminary injunction took effect immediately.
The Department of Labor said that it would “not take any enforcement action or seek remedial relief as a result of such alleged noncompliance with Executive Order 13950” nor “enforce any of the provisions required by Section 4(a) of Executive Order 13950 contained in government contracts or subcontracts.”
After President Biden won the 2020 election, various organizations and members of Congress pushed to repeal Executive Order 13950. On January 20, 2021, President Biden’s first day in office, he quickly rolled out more than a dozen executive orders. One of those orders, entitled “Advancing Racial Equity and Support for Underserved Communities Through the Federal Government,” seeks to advance racial and socioeconomic equity in America. This order outlines many priorities, including “assessing whether agency policies and actions create or exacerbate barriers to full and equal participation by all eligible individuals,” allocating funds to address historic inequality and engaging with members of underserved communities. Importantly, both to this Note’s analysis and for government contractors, Section 10 of Biden’s executive order repealing Executive Order 13950 stated that “Executive Order 13950 of September 22, 2020 (Combating Race and Sex Stereotyping), is hereby revoked.”
The now-repealed Executive Order 13950 remains consequential. It constitutes both bad social policy and an unconstitutional mandate on government contractors. While Executive Order 13950 was not the first politically divisive policy to regulate government contractors, it is a prime example of the detrimental effects resulting from a swiftly enacted and repealed executive order.
First and foremost, Executive Order 13950 was a bad social policy. Discussions on critical race theory and white privilege have important societal value and should not have been banned. As Sarah Hinger and Brian Hauss of the American Civil Liberties Union explain, “[w]hat Trump deems ‘harmful ideologies’ are actually concepts diversity trainings use to educate individuals on the systemic barriers and discrimination people of color and other marginalized groups still face in this country today across our institutions—from our workplaces and schools to our criminal legal system.” The discussion of sensitive topics—including white privilege—is essential for Americans to understand the long-lasting effects of systemic discrimination and racism. Prohibiting this type of training halts the discussion and education of those living in ignorance about the challenges women and people of color face every day. From a purely policy-based perspective, Executive Order 13950 was regressive and out-of-touch with the realities of America.
Additionally, Executive Order 13950 was unconstitutional. Though the Northern District of California granted a preliminary injunction stopping the enforcement of Executive Order 13950 in Santa Cruz Lesbian and Gay Community Center v. Trump, there should have been a more permanent ruling that Executive Order 13950 was unconstitutional. While the court granted a permanent injunction on the executive order because it was both unconstitutionally vague in violation of the Due Process Clause of the Fifth Amendment and in violation of the First Amendment right to freedom of speech, the court should have gone further in declaring the executive order unconstitutional.
The first reason Executive Order 13950 should have been declared unconstitutional is because it constituted a content-based restriction on speech. Content-based restrictions on free speech are rarely permissible and subject to strict scrutiny. The government “must show that its regulation is necessary to serve a compelling state interest and is narrowly drawn to achieve that end.” The government could not prove either prong—compelling interest or narrow tailoring—in this case. Though it is harder to determine what a compelling state interest is beyond areas like protecting children, there is likely not one here because preventing discomfort is likely not a compelling a government interest. At best, the government could argue it is “protecting” people against learning about systemic racism, white privilege, and other divisive topics that could offend or make people uncomfortable. In an era of “fake news,” it is important people learn the truth, even about information that makes them uncomfortable or forces them to confront their own privilege and biases.
Additionally, even assuming there is a compelling state interest, the now-repealed executive order is not narrowly tailored. The executive order does not ban specific ideas but instead bans “divisive concepts.” The executive order defines a divisive concept as the following:
‘Divisive concepts’ means the concepts that (1) one race or sex is inherently superior to another race or sex; (2) the United States is fundamentally racist or sexist; (3) an individual, by virtue of his or her race or sex, is inherently racist, sexist, or oppressive, whether consciously or unconsciously; (4) an individual should be discriminated against or receive adverse treatment solely or partly because of his or her race or sex; (5) members of one race or sex cannot and should not attempt to treat others without respect to race or sex; (6) an individual’s moral character is necessarily determined by his or her race or sex; (7) an individual, by virtue of his or her race or sex, bears responsibility for actions committed in the past by other members of the same race or sex; (8) any individual should feel discomfort, guilt, anguish, or any other form of psychological distress on account of his or her race or sex; or (9) meritocracy or traits such as a hard work ethic are racist or sexist, or were created by a particular race to oppress another race. The term ‘divisive concepts’ also includes any other form of race or sex stereotyping or any other form of race or sex scapegoating.
This definition does not provide clarity for implementation; instead, to ensure compliance with the executive order, government contractors and other affected groups completely avoided discussions of race, sex, or gender in the workplace altogether. The order should have included a written, exclusive list of banned topics to be narrowly tailored enough to pass strict scrutiny.
The second reason Executive Order 13950 should have been deemed unconstitutional is because it was unconstitutionally vague. The Supreme Court reaffirmed the doctrine of unconstitutional vagueness in 2012, stating, “[t]he void for vagueness doctrine addresses at least two connected but discrete due process concerns: Regulated parties should know what is required of them so they may act accordingly . . . and precision and guidance are necessary so that those enforcing the law do not act in an arbitrary or discriminatory way.” Here, regulated parties did not know what was expected of them, and therefore ceased discussion of race, sex, or gender altogether out of fear that any mention of those topics would violate the executive order. While Section 10 of Executive Order 13950 said that “[t]his order does not prevent agencies, the United States Uniformed Services, or contractors from promoting racial, cultural, or ethnic diversity or inclusiveness provided such efforts are consistent with the requirements of this order,” it had already caused confusion, and “some employers had already canceled or scaled back certain programs, removed certain words from their trainings, or postponed training sessions.” The lack of clear and unambiguous language and direction, coupled with the real-life effects of canceled trainings, prove that this executive order is unconstitutionally vague. Though the repeal of Executive Order 13950 makes a formal ruling of unconstitutionality unnecessary to stop the enforcement of the executive order, it is important to point out the flaws of such a policy so that no similar future policies are implemented.
The repeal of Executive Order 13950 does not signify the end of its importance. An African American Policy Forum research associate, Vincent Wong, explains that Executive Order 13950 is “a sign of the conservative reaction against the culture’s growing recognition of systemic racism.” Its enactment proves there are many people in positions of power who not only refuse to acknowledge systemic sex and race barriers in society, but also do not want others to be educated on such issues. Additionally, the enactment of a policy that so blatantly violated freedom of speech shows the dangerous ability of a president to attempt to, and temporarily succeed at, silencing speech with which he did not agree. Furthermore, and most importantly, Executive Order 13950 should be a warning of the over-reliance of executive orders generally to regulate government contractors on labor and employment issues.
The lifecycle of Executive Order 13950 is indicative of a larger problem: executive orders are unpredictable and less likely than legislation to create long-term social change. This is especially pertinent to government contractors who must adjust their businesses from when presidential administrations shift. Constantly changing regulations could dissuade potential contractors from working with the federal government. To encourage participation by these potential contractors and improve overall predictability in the procurement system, lawmakers must govern the system using legislation because it is longer lasting, gives interested parties the opportunity for input, and undergoes more deliberation before enactment.
There are important procedural differences between enacting policy through legislation as opposed to executive orders. As previously discussed in Part II.A, passing legislation requires the consent of both chambers of Congress and a signature from the president, while executive orders carry the force of law by the decree of the president. In his first three years, President Obama issued 108 executive orders, while President Trump issued 130. In his first two weeks in office, President Biden signed twenty-eight executive orders. However, just as quickly as executive orders are enacted, they can disappear from administration to administration as “a sitting U.S. President may overturn an existing executive order by issuing another executive order to that effect.” This is the nature of executive orders, which “lack stability, especially in the face of evolving presidential priorities. The President is free to revoke, modify, or supersede his own orders or those issued by a predecessor.”
These fast-paced changes are particularly important for government contractors. Government contractors make up a large segment of the economy and workforce. In 2019 alone, the government spent $597 billion on federal government contracts. Because this amount is such a large portion of the economy, “[t]he issuance of executive orders requiring agencies to impose certain conditions on federal contractors and subcontractors has practical as well as legal significance given the scope of federal procurement activities,” effectively allowing the president to significantly regulate segments of the U.S. economy.
Executive orders have already had, and will continue to have, substantial effects on government contractors. During the first few weeks of the Trump administration in 2017, “Trump ordered the Environmental Protection Agency (EPA) to temporarily suspend all contract and grant awards.” Trump then continued to use his executive authority to dictate the policies of government contractors, including by revoking the Nondisplacement of Qualified Workers Under Service Contract and the Fair Pay and Safe Workplaces executive orders. Just as quickly as government contractors spent time, money, and resources rushing to comply with the new regulations, they were gone. These quickly fluctuating policies from administration to administration create an undue burden on government contractors.
President Trump utilized his ability to easily amend policy by rolling back many of President Obama’s executive orders. During the Trump presidency, the President issued seventeen executive actions to rollback Obama-era policies, including overturning an Obama-era decision that prohibited oil and gas drilling in millions of acres in the Arctic and Atlantic Oceans. Yet, President Trump did not just revoke existing orders on contractors: he also added his own policies, as evidenced by Executive Order 13950.
Executive Order 13950 is a prime example of the harms that can be inflicted on government contractors through executive orders. As swiftly as the order was enacted, government contractors reacted, and there was “an almost immediate chilling effect on reinvigorated efforts to address racial disparities in the workplace.” That does not include all the legal and regulatory hours wasted while companies attempted to comply. The enactment of this policy also proves it is not only Democrats that impose additional regulations on government contractors. As reported in the New York Times,
Glenn Spencer, the senior vice president of the U.S. Chamber of Commerce’s employment policy division, likened the order to Obama-era requirements on federal contractors. “We didn’t like the use of those kinds of executive orders back then, and we don’t like them any better now,” he said.
Despite government contractors and government insiders pushing back against executive orders regulating government contractor employment conditions, there is no sign that presidents will stop issuing them in the near future, as the Biden administration is following in line with its predecessors.
Some on the political left may see the Biden administration’s use of executive orders as an improvement by enacting more socially liberal policies and undoing the “damage” former President Trump caused, as they believe that “President-elect Joe Biden’s first order of business must be to undo damage done unilaterally by the Trump administration. Executive orders and federal regulations can be as significant as laws and court rulings.” As the Biden administration begins, the “government contracting community may be wondering whether the change in administration and party in the White House will lead to significant changes to federal procurement.”
However, quick enactment, declaration of unconstitutionality, and eventual repeal would instead be a wake-up call to those in power: presidents should stop using executive orders that regulate government contractors to enact their social policy agendas. Those policies executed through executive orders end up being inefficient and creating uncertainty because of the fleeting, ephemeral nature of executive orders as policy vehicles. As the tides of democracy and politics change, so too the executive orders in place. Government officials should instead focus on legislating social policies through Congress to ensure their effects protect generations to come.
Legislation has three key benefits: (1) it is longer lasting, (2) it gives interested parties the opportunity for input, and (3) it undergoes more deliberate considerations before enactment. First, legislation allows interested and affected parties to more easily lobby and voice their opinions. Compared to the private black-box process of issuing executive orders, the path for a bill to become a law is easily accessible to the public. A bill is sponsored by a representative or senator, the text of the bill is readily accessible online, and particularly important bills are covered by major news outlets. Interested parties closely follow developments and come up with lobbying and public affairs strategies to influence legislation. Interested parties can hire lobbyists or deploy a grassroots campaign to change, delay, or defeat unwanted legislation or show their support for helpful policies. When trying to influence an executive order, affected parties’ only opportunity to express concerns is in the following notice-and-comment period after the president has unliterally declared his desire for the policy to move forward, making it less likely for policy changes to occur at all. While lobbying may get a bad reputation, if a president wants his policy to be effective and practical, it makes sense for the affected parties to have constructive input. Additionally, the lengthy process of enacting a bill into law also allows the public to be informed by the media, lobbyists, affected parties, and other members of Congress to provide input. All of this allows members of Congress to go into a vote on a bill more informed than a president signing an order in a bubble without the same inherent public scrutiny.
Second, because legislation requires the consent of the House, Senate, and president, the resulting legislation is more likely to contain a bipartisan, well-thought-out solution. In January 2014, met with a divided government, President Obama was famously quoted as saying, “We’re not just going to be waiting for legislation in order to make sure that we’re providing Americans the kind of help they need. I’ve got a pen and I’ve got a phone . . . . And I can use that pen to sign executive orders and take executive actions.” This quote is but one example of how presidents use executive orders to bypass the democratic process and enact their own change.
Although executive orders may be beneficial because the president can quickly enact policies that he promised during his campaign, executive orders lack the compromises and coalition building required to pass legislation, creating more divisive policies that are ripe for new administrations to alter or overturn. The legislative route additionally crafts better policies because it includes built-in subject-matter expertise in the form of congressional committee staff and experts, as members of Congress often rely on “the senior committee members and committee staff who possess superior knowledge and expertise . . . for information and cues.” These experts attempt to narrowly craft legislation so that it is clear, resistant to legal challenges, and effective. While Congress may be considered ineffective at getting any legislation passed, thus prompting policy proponents to look to more politically feasible executive orders, this is a problem with the current Congress and not the mechanism of legislation. Even if executive orders are more politically feasible short-term, the fact that they are easily repealed and create worse policy justifies waiting for legislative solutions.
Third, legislation is more permanent than executive orders. A president can easily revoke or modify an existing executive order by enacting a new one to take its place. Since 1994, 336 executive orders—representing 48% of all executive orders from the presidency of Bill Clinton to the presidency of Donald Trump—have either amended, superseded, or revoked previous executive orders. The sheer number of amended and revoked executive orders demonstrate their fleeting nature. Some may argue that it takes too long to enact legislation, and, thus, executive orders are beneficial for enacting policies in the moment they are needed. However, the long legislative process is worth the opportunity to create long-lasting change. The process for directly revoking a law passed by Congress and signed by the president requires a new law to be passed revoking the previous law. The repeal of an existing law would require bicameralism and presentment: a majority in the House and Senate vote to approve, followed by the president’s signature. Unlike revocations of executive orders, repeals of existing legislation rarely occur. Researchers Jordan M. Ragusa and Nathaniel A. Birkhead found that from 1877 to 2012, a 135-year time period, only 98 major statutory repeals occurred. This averaged to 1.3 major repeals per congressional session. Thus, if presidential administrations want to enact lasting social change, it should be done through legislation.
Government contractors in particular benefit from the certainty afforded by legislation. Because the federal government spends hundreds of billions of dollars annually on government contracts, companies that cannot comply with applicable regulations have a lot to lose. Regulations imposed by executive order are implemented unilaterally, making them unpredictable. This unpredictability hurts both government contractors and the government, which benefits from enhanced competition among qualified contractors.
Companies who are otherwise interested in contracting with the government are potentially driven away because they may worry about constantly having to comply with ever-changing regulations, which often costs them significant time and money. Regarding Executive Order 13950, one law firm advised government contractors “to remain vigilant, monitor the regulatory guidance of the new administration, make necessary changes to government contracting compliance programs, understand new government clauses, and consult with legal counsel regarding the resulting implications and corresponding best practices as they continue to do business with the government.” Keeping up-to-date with current regulations is a lot of work for government contractors. The unpredictability in contracting due to executive orders creates apprehension for potential and existing contractors about working with the government. Further, it requires contractors to constantly adapt because executive orders could end up excluding the best, most qualified applicants from even applying for contracts. Increasingly complex regulations imposed by executive orders only further entrench large, incumbent contractors with the resources to attain ever-changing compliance requirements. If a goal of the government is to increase access to government contracts to small businesses and disadvantaged groups, the regulations with which they must comply should be clear, predictable, and long-lasting.
Legislation is the better mechanism to govern government contractors. One recent example of a regulation implemented through legislation is the Fair Chance to Compete for Jobs Act of 2019 (Fair Chance Act). The Fair Chance Act prohibits federal government contractors and federal agencies from looking into a job applicant’s criminal history until after a job offer has already been made. This legislation follows the trend in local and state jurisdictions to “ban-the-box,” meaning to pass legislation prohibiting employers from inquiring about prior felony convictions. Though first introduced in 2017, the Fair Chance Act was not passed until 2019 as part of the National Defense Authorization Act (NDAA).
The Fair Chance Act exemplifies the benefits of legislation passed by Congress. Unlike executive orders, which are enacted by one person from one political party, both political parties had to agree to this Act. Though federal “ban-the-box” legislation is typically associated with Democrats, the provision was agreed upon by Republicans and signed by then-President Trump, indicating consideration and deliberation by both parties. The NDAA passed the House 359-54 and passed the Senate 87-10, representing the bipartisan nature of the legislation.
Some may argue that unrelated provisions can also be included in large, omnibus-style bills like the NDAA, and thus, they are just as bad as executive orders. However, these bills require passage by at least 269 total members of Congress and the president. An executive order only requires the sign-off and approval of one person.
Additionally, the Fair Chance Act is not effective until December 2021, giving government contractors time to “review hiring practices and onboarding materials, including application forms, checklists, and policies; offer periodic training to those involved in the recruiting and hiring processes; and determine how best to implement a policy (or policies) to comply with all applicable federal, state and local laws.” While executive orders can theoretically also have delayed implementation, delays are far less likely as presidents intentionally use executive orders to get around the long, burdensome legislative process. For example, Executive Order 13950 was introduced on September 22, 2020, and went into effect less than two months later on November 21, 2020.
Overall, the benefits of legislating policy through Congress over enacting it through executive orders are numerous. As the Biden administration moves forward, there have already been promises made to address the COVID-19 crisis, the economy, climate change, and racial injustices. As these promises are carried out, the Biden administration and future administrations should heed the lessons from Executive Order 13950 and push for legislative solutions to societal problems.
Though Executive Order 13950 was revoked on day one of the new presidential administration, its very existence continues to have implications for contractors. In the short term, government contractors and other affected groups had to decide whether to re-schedule or re-implement diversity trainings. This means companies had to decide whether banning “divisive concepts” is good for worker morale and societal progress. It absolutely is not. Trainings on sensitive topics such as systemic racism are key to educating the public about the challenges racial minorities and women still face today. Government contractors should continue existing diversity training to better equip their workforces for the realities of unequal treatment of women and minorities both in the workplace and society-at-large.
In the long term, the rise and fall of Executive Order 13950 serves as a reminder to government contractors that as quickly as executive orders can change long-standing policies, they can just as easily be repealed. Government contractors have long been used as a testing ground for larger social policies. They are often the first impacted by ambitious administrations who have yet to iron out the details and effects of their policies. This leads to confusion and expensive modifications to long-standing existing policies as government contractors attempt to comply. This problem has been exacerbated by the trend of governing through executive orders, which allow presidents to swiftly enact their visions for social change. For the sake of both government contractors and effective governing, presidential administrations are better off governing by working with Congress to pass legislation. The deliberate legislative process not only creates more well-thought-out policies but is also more likely to endure from administration to administration. This allows government contractors to focus more on creating the best products and services for the government instead of having to catch up to ever-changing regulations.
