As 2026 approaches, the compliance landscape shaped by Executive Order 14173, “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” is entering a more enforcement-focused phase.
Based on the recent HR Unlimited Roundtable with former OFCCP and EEOC leaders, federal contractors must brace for a dramatic and high-stakes shift in anti-discrimination enforcement in 2026. The focus is moving away from routine compliance audits and toward aggressive fraud-based litigation with massive financial penalties.
The repeal of Executive Order 11246 by Executive Order 14173 did not eliminate anti-discrimination law; it fundamentally changed how it is enforced.
Here are the top predictions for enforcement activity in 2026.
Certification-Based Enforcement Takes Center Stage
Executive Order 14173 introduced a fundamental shift in compliance accountability: certifications. Every federal contractor and grant recipient must now attest that their organization does not operate any programs promoting DEI that violate federal anti-discrimination laws, and that compliance with those laws is material to government payment decisions under the False Claims Act (FCA).
Panelists agreed that 2026 will mark the first wave of DOJ Civil Rights Fraud Initiative investigations testing the accuracy of those certifications. Organizations that sign without conducting documented due diligence risk exposure to treble damages under the FCA.
What to Expect:
- Contractors will face Civil Investigative Demands (CIDs) requesting DEI documentation, training content, and compliance program audits.
- DOJ and agency inspectors general will focus on whether attestations were backed by verifiable compliance efforts.
DEI Rebranding Is Not Enough: Substantive Audits Matter
Many organizations have “rebranded” their DEI programs, but the Department of Justice’s July 2025 guidance and Attorney General Pam Bondi’s memo, “Guidance for Recipients of Federal Funding Regarding Unlawful Discrimination,” make clear that labels are irrelevant. What matters is the content and effect of programs.
Practices that use proxies such as zip codes, lived experience, or targeted demographic outreach may still be deemed discriminatory under the new interpretation of Title VII and related statutes. In 2026, the focus will move from program intent to program outcomes.
Action Tip: Conduct a DEI-to-Compliance Audit to ensure all hiring, promotion, and outreach programs are neutral, inclusive, and merit-based.
Affirmative Action Programs Aren’t Gone; They’ve Evolved
Although EO 11246 was revoked, our panelists emphasized that Affirmative Action-style data analysis remains essential. Employers must continue to demonstrate compliance with the law through “Anti-Discrimination Programs” or “14173 Compliance Programs.”
These programs should include:
- Annual Pay-Equity and Adverse-Impact Analyses
- Barrier Identification Studies
- Inclusion of all groups, including white employees and men to ensure neutrality
- Documentation of remedial steps taken
Continuing these analyses not only satisfies legal expectations but also provides crucial evidence of good-faith compliance should investigations arise.
Refer to the following discrimination cases in which the courts relied on workforce data and statistical analyses as key evidence in reaching their decisions:
- EEOC v. American National Bank, 652 F.2d 1176 (4th Cir. 1981)
- Griggs v. Duke Power Co., 401 U.S. 424 (1971)
- EEOC v. Dial Corp., 469 F.3d 735 (8th Cir. 2006)
- EEOC v. Morgan Stanley & Co., S.D.N.Y. (2004)
- EEOC v. Kellogg Co., E.D. Tenn. (2011)
- Ricci v. DeStefano, 557 U.S. 557 (2009)
- EEOC v. Ford Motor Co., E.D. Mich. (2008)
- EEOC v. Outback Steakhouse of Florida, 576 F. Supp. 2d 1202 (D. Colo. 2008)
DOJ and EEOC Coordination Is Expanding
The Roundtable panel agreed that 2026 will see unprecedented interagency collaboration. The EEOC’s FY 2026 Budget Justification outlines increased systemic case capacity and cross-agency data sharing with the DOJ.
This means investigations will no longer occur in silos. A single certification or complaint could trigger joint DOJ–EEOC scrutiny across hiring, pay, and promotion practices.
Sector-Specific Enforcement: Universities, Law Firms, and Contractors
Several companion executive orders are already targeting universities and professional services for discriminatory admissions or hiring practices tied to DEI programs.
In 2026, these initiatives will expand to federally funded nonprofits, educational institutions, and major service contractors, particularly those engaged in government grants, research, or consulting.
Bottom line: Any organization receiving federal dollars should anticipate audit readiness.
Board-Level Accountability Becomes an Expectation
Our Roundtable experts underscored that corporate governance will become a key indicator of compliance maturity.
Boards and executives are expected to be informed of compliance status and certification readiness, with documentation in minutes and reports serving as proof of diligence.
Boards that ignore or delegate compliance without oversight could be seen as willfully blind, a factor that may influence FCA enforcement decisions.
Preparing for 2026: A Compliance Playbook
To minimize risk and demonstrate good faith, organizations should:
- Formalize a “14173 Compliance Program” that consolidates pay equity, barrier analysis, and policy audits under a single governance structure.
- Establish a Certification Checklist confirming readiness before signing any federal attestation.
- Retain compliance documentation for at least five years, anticipating DOJ CIDs.
- Conduct internal mock audits to simulate agency inquiries.
- Educate HR, Legal, and leadership teams on FCA exposure, materiality standards, and recordkeeping requirements.
Final Thought
2026 will not be a year for waiting and watching. It will be a year of proactive compliance. The Department of Justice has made clear its intention to “aggressively pursue” organizations that misrepresent their compliance status, while the EEOC continues expanding systemic enforcement.
Those who invest early in evidence-based, merit-driven compliance programs will not only reduce enforcement risk but also strengthen workplace equity on lawful, sustainable grounds.
At HR Unlimited Inc., we help federal contractors and employers navigate complex compliance requirements while building stronger, more inclusive workplaces. If you’re ready to strengthen your compliance and equity efforts, contact us today to learn how we can support your EEO and non-discrimination goals.