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Federal Contractors Face Three Layers of Nondiscrimination Certification

Keith Atkinson · September 27, 2026 · 9 min read

Federal Contractors Face Three Layers of Nondiscrimination Certification

Executive Orders 14173 and 14398 changed the paperwork, the contract language, and the risk. Here is what small businesses need to understand before they sign.

The short version

A contractor may make related promises in more than one place: through company-level representations, through an Executive Order 14173 certification in an award, and through the newer FAR 52.222-90 clause. These promises overlap, but they are not identical. Read each one before signing.

The old system changed, but nondiscrimination did not disappear

For decades, many federal contractors associated equal-employment compliance with Executive Order 11246 and written affirmative action plans. Executive Order 14173, signed January 21, 2025, revoked EO 11246 and ended that executive-order framework for race- and sex-based affirmative action.

That did not make discrimination legal. Federal laws such as Title VII still apply when their normal coverage rules are met. Separate requirements for protected veterans and people with disabilities may also continue to apply. The important change is that the government now puts more weight on what a contractor certifies and what the contract itself requires.

Why people call it a "three-layer" system

  1. Company-level representations — Statements made in SAM.gov or in an offer package can apply broadly to the business.
  2. EO 14173 award terms — The contractor certifies that its programs comply with applicable federal anti-discrimination law.
  3. FAR 52.222-90 — A contract clause adds specific duties, records access, subcontract reporting, and flowdown.

The practical lesson is simple: one review is not enough. A statement made during registration may be different from a certification attached to a solicitation. A signed contract may then add another clause with continuing duties during performance.

Layer 1: Company-level representations set the baseline

Federal vendors already use the System for Award Management (SAM.gov) to maintain registration information and annual representations and certifications. A solicitation may rely on those answers, ask for updated answers, or include its own certification.

For nondiscrimination compliance, treat any statement presented in SAM.gov or an offer package as a company-level promise. Do not let one employee click through it as a routine renewal without checking whether the company's real policies and practices support the answer.

> Do not assume: A new governmentwide SAM.gov nondiscrimination statement applies to every procurement in exactly the same way. Some SAM-related certification proposals have focused on federal financial assistance, while contract agencies may use award-specific language. The controlling text is the language actually presented to you.

Layer 2: EO 14173 turns the award certification into a payment issue

Executive Order 14173 tells agencies to include two important terms in every federal contract or grant award:

In plain English, this is more than a promise to follow the law. The order connects the promise to whether the government pays. If a company knowingly makes a false certification, that can create False Claims Act risk in addition to ordinary employment-law or contract risk.

What "material to payment" means in everyday terms

The government is saying that compliance matters to its decision to pay the contractor. That does not mean every mistake automatically becomes fraud. False Claims Act cases still depend on facts and legal requirements, including knowledge and materiality. But it does mean that careless certifications can become much more expensive than a simple paperwork error.

> The safe habit is to verify the facts before anyone signs, submits, renews, or accepts a modification.

What the certification is really asking

The question is not whether your company uses the word "DEI." The question is whether any actual policy or program violates federal anti-discrimination law. A renamed program can still be unlawful. A program with a DEI label is not automatically unlawful. The real issue is how people are treated and how decisions are made.

Layer 3: FAR 52.222-90 adds specific duties during contract performance

Executive Order 14398, signed March 26, 2026, directed agencies to use a standard contract clause. The Federal Acquisition Regulatory Council then published the model deviation now identified as FAR 52.222-90, Addressing DEI Discrimination by Federal Contractors.

The clause is narrower in wording but heavier in duties

FAR 52.222-90 defines "racially discriminatory DEI activities" as different treatment based on race or ethnicity in any of these areas:

The clause applies "in connection with the performance of work under this contract." That wording matters. Contractors should map the people, vendors, programs, and resources connected to each covered contract instead of relying only on a general employee handbook review.

Signing the clause carries six practical promises

  1. No prohibited activity. The contractor agrees not to engage in the defined racially discriminatory DEI activities.
  2. Access to information. The contractor must provide information, reports, and access to books, records, and accounts when the contracting officer requires them to check compliance.
  3. Contract consequences. Noncompliance may lead to cancellation, termination, or suspension, and the contractor or subcontractor may be declared ineligible for future federal contracts.
  4. Subcontractor reporting. The prime must report known or reasonably knowable subcontractor conduct that may violate the clause and take remedial action directed by the contracting officer.
  5. Notice of litigation. The contractor must tell the contracting officer if a subcontractor sues and the lawsuit puts the clause's validity at issue.
  6. False Claims Act materiality. The contractor recognizes that compliance is material to government payment decisions.

The duty follows the work down the supply chain

The clause says its substance must be included in subcontracts at any tier, including subcontracts for commercial products and commercial services, except where delivery or performance is outside the United States. A prime contractor therefore needs more than a clause in its own files. It needs a repeatable way to identify covered subcontracts, insert the flowdown, collect acknowledgments, and handle warning signs.

Review the real decision rules, not just the policy titles

A useful compliance review looks at how opportunities and resources are actually awarded. The same questions should be asked about employees, job applicants, interns, vendors, subcontractors, and participants in company-sponsored programs.

The 8-step pre-certification checklist

  1. Build a certification map. List every active SAM.gov representation, solicitation certification, award term, and contract modification. Record who signed it and when.
  2. Inventory covered practices. Review recruiting, hiring, promotion, compensation, training, mentoring, leadership programs, internships, vendor selection, and resource allocation.
  3. Test eligibility rules. Ask whether race or ethnicity affects who can apply, participate, receive preference, be selected, or receive company resources.
  4. Check actual practice. A neutral written policy is not enough if managers use different rules in practice. Interview the people who make decisions.
  5. Document job-related reasons. Keep clear, consistent records showing the neutral criteria used for hiring, promotion, program admission, and supplier selection.
  6. Control the flowdown. Use a subcontract checklist so FAR 52.222-90 reaches every covered tier. Keep signed copies and track exceptions.
  7. Create an escalation path. Tell staff where to report a concern. Decide who contacts counsel and the contracting officer when the clause requires notice.
  8. Approve before certifying. Require legal, HR, contracts, and leadership review before a certification is submitted or a modification is accepted.

Examples that deserve a closer look

> Avoid the cosmetic fix: Do not simply rename a program, delete a few words, or move a rule into an unwritten practice. Review the eligibility criteria, selection process, funding, communications, and real outcomes. Also preserve relevant records; do not destroy documents in response to a compliance concern.

Equal opportunity work can still be lawful

The orders and clause focus on unlawful discrimination and, under FAR 52.222-90, specified race- or ethnicity-based disparate treatment. Employers can still recruit widely, remove unnecessary barriers, enforce anti-harassment rules, provide generally available training, and use job-related selection criteria. The line can be fact-specific, so unclear programs should be reviewed before certification.

The safest rule is simple: verify before you certify

The new framework raises the stakes because the same basic subject can appear at the company, award, and contract-performance levels. A contractor should not assume that a SAM.gov renewal, an offer certification, and FAR 52.222-90 all ask the same question.

Before signing, compare the exact language with the company's current practices. Make sure the review covers subcontractors and lower-tier suppliers when the clause requires it. Keep the evidence supporting the answer. If the facts are unclear, pause and get qualified legal advice rather than guessing.

Five questions to ask before the next submission

  1. What exact certification or clause am I accepting?
  2. Does it apply companywide, to this award, or only to work connected with this contract?
  3. Which policies, programs, vendors, and subcontractors are covered?
  4. What records prove our answer is accurate?
  5. Who has authority to approve the certification and handle a concern?

Official sources

  1. Executive Order 14173, Ending Illegal Discrimination and Restoring Merit-Based Opportunity (January 21, 2025).
  2. Executive Order 14398, Addressing DEI Discrimination by Federal Contractors (March 26, 2026).
  3. Acquisition.gov implementation update for EO 14398.
  4. Acquisition.gov, FAR Part 52 model deviation, including 52.222-90.
  5. Acquisition.gov, FAR Subpart 22.22 implementation text.

Legal note: This article provides general information, not legal advice. Executive orders, agency deviations, litigation, and rulemaking can change. Contractors should review the current solicitation, contract, modifications, agency guidance, and applicable law, and should consult qualified counsel about their own facts.