- New Executive Order Goes After Federal Contractor DEI Practices
- DOL Proposed Rule Aims to Change Foreign Worker Prevailing Wages
- OMB Completes Review of Alternative Assets in 401(k) Proposal
New Executive Order Goes After Federal Contractor DEI Practices
U.S. President Donald Trump extended his attack on diversity, equity and inclusion (DEI) on Thursday, March 26, by signing an executive order aimed at eliminating “racially discriminatory” practices within federal contractors.
The order follows Trump’s Jan. 21, 2025, executive order, which revoked previous affirmative action requirements for federal contractors.
Important elements of the order include:
- The prohibition of racially discriminatory DEI. The action defines “racially discriminatory DEI activities” as disparate treatment based on race or ethnicity in hiring, promotions and contracting, and prohibits them. It also emphasizes hiring and contracting based on merit and individual achievement rather than immutable characteristics.
- Mandatory contract clauses. Federal contracts will require a clause where contractors certify they do not operate programs that violate federal antidiscrimination laws.
- False Claims Act liability. Compliance with antidiscrimination laws is now considered material to government payment decisions, increasing False Claims Act (FCA) risk for contractors.
- Enforcement actions. The order directs agencies to suspend, terminate or cancel contracts for noncompliance, and allows for contractor debarment. It also directs the attorney general to review potential violations and prioritize claims against contractors.
- Federal change implementations. Federal agencies must internalize the order into their processes by updating their contracts within 30 days and Federal Action Regulation rules within 60 days.
DOL Proposed Rule Aims to Change Foreign Worker Prevailing Wages
The U.S. Department of Labor’s Employment and Training Administration (ETA) on Thursday, March 26, issued a proposed rule designed to strengthen American workers’ wage and job prospects by curtailing employers’ ability to pay substandard wages to foreign workers in certain visa programs.
The proposed rule, which was slated to be published in the Friday, March 27, edition of the Federal Register, would change the existing Department of Labor (DOL) methodology for determining prevailing wage levels in the following visa programs:
The DOL stated the new methodology would use percentile thresholds derived from the Bureau of Labor Statistics’ Occupational Employment and Wage Statistics survey to align the wages paid to foreign workers with wages paid to similarly employed U.S. workers.
According to a DOL press release, “This much-needed change aims to curb abuse of certain visa programs by reducing the incentive to displace American workers with low-wage foreign visa holders and establishing parity between the wages paid to U.S. workers and foreign workers entering the country on certain employment-based visas. Existing prevailing wage levels have, for too long, been set dramatically below the market rates which many American workers receive, particularly entry-level Americans and recent college graduates in science, technology, engineering and math fields. Because of this, the H-1B program has been distorted by hiring practices that abuse the program to replace their existing American workforce with cheap foreign labor.”
Public comments on the proposed rule are due by May 26.
The ETA will release additional information and technical assistance materials on its Office of Foreign Labor Certification page.
OMB Completes Review of Alternative Assets in 401(k) Proposal
The U.S. Office of Management and Budget (OMB) on Wednesday, March 25, announced it completed its review of the DOL’s proposed rule, “Fiduciary Duties in Selecting Designated Investment Alternatives,” which seeks to ease the inclusion of alternative assets in 401(k) plans. This clearance allows the proposal to move toward public release in the Federal Register and a 60-day comment period.
As detailed in previous Workspan Daily content, the proposed rule is a key deliverable of President Donald Trump’s Aug. 7, 2025, executive order (“Democratizing Access to Alternative Assets for 401[k] Investors”). A prominent line item in that order directed Secretary of Labor Lori Chavez-DeRemer (with consult from the Treasury Department and the Securities and Exchange Commission) to review and clarify Employee Retirement Income Security Act (ERISA) fiduciary guidelines to allow alternative assets to be more widely considered and included in retirement plans. Such assets include private market investments (including debt, equity, credit and infrastructure) as well as digital investments (e.g., cryptocurrencies).
The rule is intended to reduce legal risks for plan sponsors and encourage wider adoption of alternatives in target-date funds.
Editor’s Note: Additional Content
For more information and resources related to this article, see the pages below, which offer quick access to all WorldatWork content on these topics:
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