The Department of Defense (DoD) is shifting its focus to contracting in its latest push to eliminate diversity, equity, and inclusion (DEI) practices across the agency by unveiling a new policy that removes DEI-related provisions from contracts.
The new policy, Class Deviation 2025-O0003, was released on March 4 by the Principal Director of Defense Pricing, Contracting, and Acquisition Policy. It aims to restore “merit-based opportunities in Federal contracts” by directing contracting officers to remove and replace provisions and clauses in the Federal Acquisition Regulation (FAR) related to a 1965 equal employment opportunities executive order.
Executive Order 11246, known as the “Equal Employment Opportunity” order, was signed by President Lyndon B. Johnson in 1965 and prohibited discrimination by Federal contractors. In 2025, President Trump rescinded it with Executive Order 14173, “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” eliminating DEI-related efforts within the Federal government and shifting focus to “merit-based performance.”
The policy directs contracting officials to implement these changes not only for future contracting opportunities but also to amend open solicitations to reflect the updates. It also requires contracting officers to modify existing contracts to remove any DEI-related clauses.
However, an exception is being made for contract actions nearing the end of their performance period – those with less than six months remaining and no options to extend – where modification is not required.
This new policy is just the latest in a series of directives from the Pentagon as it works to implement the requirements outlined in President Trump’s anti-DEI order.
Most recently, the DoD launched a task force aimed at eliminating all DEI programs within the military. Following this, Defense Secretary Pete Hegseth discontinued the celebration of “identity months” at military installations, directing that DoD Components and Military Departments refrain from using official resources, including man-hours, to host events or celebrations related to cultural awareness months.
