Trump adds federal contractors onto his DEI ban list

President Donald Trump signed an executive order March 26 requiring companies that enter contracts with the federal government to ban "racially discriminatory DEI activities" within their businesses. DEI refers to diversity, equity and inclusion policies.

The order follows a long line of executive actions seeking to remove DEI policies from the federal government. Many of Trump's efforts are facing legal pushback.

The March 26 order "appears to ramp up potential enforcement by requiring certain contracts to include a clause prohibiting contractors and their subcontractors from engaging in racially discriminatory DEI activities and focusing on the repercussions for violations," Leah Brownlee Taylor, a member of the law firm, Epstein Becker Green, told PolitiFact.

Separately, in February, Transportation Secretary Sean Duffy announced that the Federal Aviation Administration would require all airlines to remove DEI hiring policies and enforce "merit based" practices. "Safety drives everything we do, and this commonsense measure will increase transparency between passengers and airlines," Duffy said.

Both of these actions came after the United States Court of Appeals for the Fourth Circuit overturned an injunction that had blocked two DEI-related executive orders in 2025. The lawsuit addressed terminating DEI mandates and policies in federal agencies and encouraging the "private sector to end illegal discrimination and preferences."

The appeals court allowed those policies to be enforced pending further legal action. The case will return to district court for consideration of the complaints' merits, Bloomberg Law reported.

Trump's latest executive order and the new FAA policy are, like other anti-DEI initiatives, subject to legal challenge. But the administration is seeking to enforce the anti-DEI policies Trump promised as a candidate. We rate this promise In the Works.