Summary of EO 14173

The purported purpose of EO 14173 is to eliminate“dangerous, demeaning, and immoral” DEI practices (Exec. Order No. 14173, 2025, p. 8633), which it describes as“discriminatory and illegal preferences” and other actions (Exec. Order No. 14173, 2025, p. 8633) that impede merit-based decision making. Moreover, the order revokes several previous directives, including those that established a government-wide initiative to promote diversity and inclusion in the federal workforce (Exec. Order No. 13583, 2011), amended earlier equal employment directives to expand workplace protections (Exec. Order No. 13672, 2014), aimed to boost diversity and inclusion in the national security workforce (President of the United States, 2016), and set equal employment opportunity standards for federal contractors (Exec. Order No. 11246, 1964).

Additionally, it directs federal agencies to eliminate all DEI-related activities, policies, and references from employment and contracting. Among federal contractors, the order requires contractual assurances of compliance with existing civil rights laws, ceases affirmative action obligations, and prohibits “workforce balancing” based on demographic categories. The order extends beyond the federal government, directing agencies and the attorney general to identify and investigate DEI-related practices in the private sector (particularly in large corporations) and nonprofit organizations.

Summary of EO 14281

EO 14281 similarly uses the motive of protecting merit-based decision-making to argue for prohibiting “disparate-impact liability” (Exec. Order No. 14281, 2025, p. 17537). Disparate impact is a legal principle that states that a policy or practice can be considered discriminatory if it disproportionately affects members of a particular protected class and is used without justifiable cause (e.g., a test of mental ability that does not predict performance). Unlike disparate treatment, disparate impact monitors unequal outcomes rather than unequal actions. The motivation behind disparate impact is to prohibit seemingly identity-neutral organizational practices that disadvantage particular groups.

The Supreme Court’s Griggs v. Duke Power Co. (1971) decision established disparate impact as a cornerstone of civil rights protection. Yet, in EO 14281, the administration argues that disparate impact liability is synonymous with group-based favoritism, forces organizations to engage in racial balancing, and opposes the merit principle. The order therefore moves to “eliminate the use of disparate-impact liability in all contexts to the maximum degree possible to avoid violating the Constitution, Federal civil rights laws, and basic American ideals” (Exec. Order No. 14281, 2025, p. 17537). Within 45 days of the order being issued, the Equal Employment Opportunity Commission chair must assess “all pending investigations, civil suits, or positions taken in ongoing matters . . . that rely on a theory of disparate-impact liability” (Exec. Order No. 14281, 2025, p. 17538).

Implications of EOs 14173 and 14281

Though the targets of these two EOs differ, they are both similar in that they attempt to erode practices or protections aimed at ensuring equality in the workplace in the name of advancing merit. Both orders risk undermining merit by dismantling safeguards against identity-based biases. More specifically, these EOs make the faulty, implicit assumption that meritocratic systems are free of limitations and are undermined by DEI and civil rights protections. However, this assumption fails to address potential pitfalls to cultivating a true meritocracy (e.g., racial bias, unequal access for employees with disabilities, etc.) while simultaneously rescinding efforts intended to address these very concerns. Similar to an EO issued by the current president during his first term that held an explicitly free-market perspective on workforce management (Exec. Order No. 13932, 2020), the current orders appear to hold the same assumption that meritocratic systems are self-exercising. However, the notion of an unencumbered free-market meritocratic system is challenged by the reality that such systems often overlook biases, reinforce existing disadvantages, and fail to address broader systemic inequities (Van Dijk et al., Reference Van Dijk, Kooij, Karanika-Murray, De Vos and Meyer2020).

Examples of merit system failures are abundant. Indeed, decades of empirical evidence demonstrate that factors outside of merit, such as the social identities one holds, impact decisions at every stage of the employment cycle. From the point of entry, minoritized applicants are less likely to receive callbacks than their majority group counterparts (e.g., Quillian et al., Reference Quillian, Pager, Hexel and Midtbøen2017). Then, if they make it into the organization, minoritized employees receive fewer developmental opportunities (e.g., King et al., Reference King, Botsford, Hebl, Kazama, Dawson and Perkins2012), are less likely to be promoted (e.g., James, Reference James2000), and are paid lower wages (e.g., Mandel & Semyonov, Reference Mandel and Semyonov2016). Thus, more than one’s qualifications shape critical employment outcomes, undermining meritocracy goals. Moreover, organizations that facilitate cultures emphasizing meritocracy appear to paradoxically make more biased decisions (Castilla & Benard, Reference Castilla and Benard2010). This is partly because, when key decision-makers in the organization believe their system is meritocratic, they overlook counterevidence and thus fail to recognize errors in merit-based decision-making that systemically disadvantage certain groups (Clarke et al., Reference Clarke, Hurst and Tomlinson2024).

As summarized by van Dijk and colleagues (2020), a key reason merit systems fail is that they reinforce individuals’ initial status through various mechanisms, such as unequal opportunity to develop skills, biases in interpersonal evaluations, and winner-take-all reward systems, that ultimately interact to reinforce and legitimize initial disparities, preventing individuals from succeeding on hard work alone. These mechanisms are summarized in Table 1. By assuming free-market labor competition, these EOs neither recognize these pitfalls nor provide guidance on managing them.

Table 1. Summary of Mechanisms Contributing to Workplace Meritocracy Pitfalls from Van Dijk et al. (Reference Van Dijk, Kooij, Karanika-Murray, De Vos and Meyer2020)

Focusing more specifically on EO 14173, DEI practices, as conceptualized and advocated for in the organizational sciences, offer solutions to the pitfalls described above. However,this order either misunderstands DEI or conflates it with illegal and fringe practices. Workplace DEI encompasses a broad, albeit perhaps ill-defined, suite of practices intended to reduce inequality and increase fair treatment for all (Follmer et al., Reference Follmer, Sabat, Jones and King2024; Iyer, Reference Iyer2022; Minkin, Reference Minkin2023). Importantly, and counter to what is implied in the EO, evidence-based DEI initiatives do not include practices such as quota-based hiring, “workforce balancing” (Exec. Order No. 14173, 2025, p. 8634), and “discriminatory and illegal preferences” (Exec. Order No. 14173, 2025, p. 8633), as these practices are illegal (Prohibited Personnel Practices, 1978). Of course, hiring quotas being outlawed does not mean they are never used, but data suggest that complaints alleging the use of quotas represent a small minority of selection-related civil rights violation claims in the USA (i.e., 2.8%; Williams et al., Reference Williams, Schaffer and Ellis2013).

DEI programs instead typically focus on practices that eliminate bias and preferential treatment, such as policies for fair hiring and pay (Minkin, Reference Minkin2023), recruitment programs intending to broaden the applicant pool (Iyer, Reference Iyer2022), training to reduce bias (Iyer, Reference Iyer2022), employee resource groups and mentoring programs (Follmer et al., Reference Follmer, Sabat, Jones and King2024; Iyer, Reference Iyer2022), and eliminating barriers to opportunity for disadvantaged groups (Equal Employment Opportunity Commission, 2003). These programs seek to increase the ability of workplaces to engage in merit-based practices by directly combating the pitfalls of meritocracy. Given this understanding, EO 14173’s wholesale prohibition of DEI is at odds with its purported goal of promoting meritocracy and will likely result in organizations taking action that stands to worsen rather than strengthen their ability to make merit-based decisions. Similarly, EO 14281 hamstrings the federal government’s ability to ensure merit-based competition and decision-making.

Moreover, EO 14281 restricts the federal government’s capacity to address seemingly innocuous discriminatory workforce management practices, regardless of intentionality. Although it remains to be seen whether disparate impact will truly be removed, given its codification in both case law (Griggs v. Duke Power Co., 1971) and the Civil Rights Act of 1991 (1991), some speculate that the most salient consequence will be that the federal government will cease enforcing disparate impact laws (Mandelman et al., Reference Mandelman, Morris, Oh, Sholinsky, Torkelsen and Green2025). Additionally, concerns arise regarding how organizations may respond to decreased enforcement. It remains to be seen whether organizations will be less likely to adopt validated assessment systems (harming the livelihood of I-O psychologists who develop those systems), intensify their efforts to build robust systems that prevent lawsuits due to increased awareness of disparate impact related to EO 14281, or take other actions. Ultimately, in abdicating enforcement of disparate impact law, the federal government not only risks further harming those affected by unequal access but also acts counterproductively to the goal of increasing meritocracy.

This order’s directives are counterproductive to achieving meritocracy because they stem from inappropriately defining disparate impact. This EO defines disparate impact as the presence of unequal outcomes, “even if there is no facially discriminatory policy or practice or discriminatory intent involved, and even if everyone has an equal opportunity to succeed” (Exec. Order No. 14281, 2025, p. 17537). However, this does not accurately represent disparate impact liability, which requires plaintiffs to identify and demonstrate that specific policies produce a disproportionate negative impact on certain groups (often via the 80% rule), regardless of the policy’s intent. The defendant must then justify that the policy serves a business need (e.g., requiring individuals to be able to lift 50 pounds to be eligible for physical labor jobs). It is, in fact, this process of justifying organizational policies that supports, rather than undermines, meritocratic decision making in organizations, as this process provides evidence for the necessity of the policy in predicting employee performance and other vital organizational goals. As was the issue in Griggs v. Duke Power Company (1971), irrelevant job requirements prevent equal opportunity by restricting individuals’ ability to compete based on their job-relevant characteristics. Thus, limiting the federal government’s ability to pursue disparate impact fundamentally hamstrings its ability to protect meritocracy.

Recommendations for I-O Psychologists and Psychology

I-O psychologists can take several actions in response to the directives advanced by EOs 14173 and 14281. First, a primary limitation of these EOs is that they do not provide clear definitions of key constructs: DEI and merit. Unfortunately, this mirrors the state of research and practice, which also lacks unified definitions of DEI, leading to various definitions and significant ambiguity around what practices fall under this umbrella (cf. Glossary of Diversity, Inclusion and Belonging [DIB] Terms, n.d.; Meta, 2022). This poses a significant barrier to federal offices seeking to comply with this EO because it does not, for example, define the scope of practices the administration deems to fall under the umbrella of DEI. EO 14371 focuses on already illegal quotas but also broadly states that all practices will be scrutinized for any relation to DEI. Though I-O psychologists cannot dictate what the federal government means by these terms, efforts to agree on and adopt unified definitions of DEI would be advantageous for increasing consistency and identifying differences between the field’s conceptualization of DEI and the government’s. To achieve this goal, we recommend that experts in this area convene to issue a unified set of definitions that could be used as a gold standard in the field (Table 2).

Table 2. Summary of Recommendations for I-O Psychologists and Psychology

In defining merit, we suggest using the conceptualization presented in the Merit System Principles (1978), which defines merit as the principle by which an individual is considered for or awarded an opportunity based on possessing a particular set of knowledge, skills, abilities, and other characteristics that are deemed relevant to a specific job through job analysis (c.f. McCrudden, Reference McCrudden1998; Merit System Principles, 1978).

Second, I-O psychologists could be instrumental in issuing guidance that specifies actions organizations can take to avoid meritocracy pitfalls, including those that DEI programs were intended to address. This would fill a critical gap because, as currently written, the EOs seek to establish a meritocracy but offer no guidance for ameliorating identity-based biases that preclude this reality. One specific practice that may be fruitful in this regard is barrier analysis, which is designed to systematically uncover, examine, and eliminate barriers that may impede free and open competition in the workplace (Equal Employment Opportunity Commission, 2003). Uncovering barriers involves identifying “triggers,” or demographic disparities in workforce data such as lower or higher participation, retention, or advancement rates among specific demographics relative to the relevant labor pool. Barriers can be institutional (e.g., policies), attitudinal (e.g., stereotypes), or physical (e.g., inaccessible facilities). Barriers may be facially nondiscriminatory but produce meritocracy-halting effects. For example, requiring in-person work arrangements when not necessary for job performance may be a physical barrier that harms specific working groups (i.e., working parents). After identifying barriers, an action plan with objectives, personnel, and target dates should be created to eliminate them.

Trigger statistics should be used to monitor potential signs of discrimination but are not conclusive evidence of such, similar to using the 4/5th rule to guide inquiries into adverse impacts (Equal Employment Opportunity Commission, 1978). Disentangling this rule from setting demographic quotas is important, as quotas are illegal and should not be used. Unlike quotas, triggers should serve as potential alerts for discrimination, and efforts should be made to reduce disparities insofar as discriminatory practices occur. Hiring managers are cautioned against “improving” demographic ratios to achieve quotas and should be informed that the presence of disparity is insufficient evidence of discrimination.

Barrier analysis is most effective when paired with and used to support validated, evidence-based workforce management practices across all phases of the employee lifecycle. When used to examine hiring, onboarding, performance evaluation, promotion, and retention processes, barrier analysis helps to pinpoint systemic obstacles and biases that might otherwise compromise fairness and merit-based decision-making. This evidence-based approach to workforce management minimizes bias across all barrier types and enhances the fairness and effectiveness of workforce management processes. Again, it is critical to note that although this analysis may reveal disparities, it is not intended to serve as a basis for establishing hiring quotas but to promote removing unjustified barriers and ensuring equal opportunity for all qualified applicants. By leveraging evidence-based practices, we can ensure that disparities are not due to prejudicial discrimination. Despite the potential loss of disparate impact, these practices will continue to ensure that we, as workforce management practice developers, do not intentionally promulgate discrimination.

Third, we recommend that I-O psychologists mobilize efforts to publicize the potential harms of the broad prohibition of DEI initiatives. As has been demonstrated, without DEI practices, organizations will not achieve a merit-based system. Instead, they are more likely to cultivate a system in which talent is imperfectly linked to employment-related decisions because biases and discriminatory practices unfairly shape the evaluations of, treatment of, and opportunities given to applicants and employees. Communicating this to the broader public is thus important for countering the misinformation in these orders and may help convince private organizations not to follow suit. Moreover, in place of such a wholesale prohibition, I-O psychologists could provide clarity around any specific DEI practices that should be avoided (e.g., the use of quotas); call for increased transparency around the DEI practices being implemented, their goals, and the evidence of their effectiveness; and/or issue recommendations around what the best available practices are (e.g., barrier analysis). Professional organizations such as the Society for Industrial and Organizational Psychology or the American Psychological Association could work with organizational scientists specializing in DEI to identify these practices, the most likely pitfalls, and areas needing further understanding. They could also support these efforts by providing funding to strengthen research evidence and address significant gaps in our knowledge of the efficacy of certain DEI practices.

Finally, we recommend that future research should continue to build an empirical foundation for integrating DEI initiatives into merit-based decision-making. For example, studies of barrier analysis can improve understanding of current best practices and uncover new approaches for identifying and removing systemic obstacles to fair competition. Scholars should also investigate how different organizational contexts shape employee perceptions of DEI efforts and which implementation strategies minimize backlash, particularly in politically polarized environments. Critically, research must also assess what happens when DEI is removed and disparate impact is not investigated, assessing how “merit-based” systems operate without these supports and the subsequent impacts. These lines of inquiry will provide the evidence base needed to operate in a post-DEI and disparate impact enforcement world.