OMB Publishes EO 14398 Implementation Guidance

April 23, 2026

What's New

The White House Office of Management and Budget (OMB) and the Federal Acquisition Regulatory (FAR) Council have issued guidance directing federal agencies to immediately begin incorporating FAR clause 52.222-90, Addressing DEI Discrimination by Federal Contractors, into new and existing contracts valued above $15,000. Agencies must “make every effort” to incorporate the clause by July 24, 2026. Prime contractors in turn must ensure the clause flows down to all subcontract tiers. The guidance and new FAR clause were expected, as the April 26, 2026, deadline for federal agencies to comply with Executive Order (EO) 14398 approaches.

What It Means

Federal agencies cannot unilaterally impose the new FAR clause. However, if a contractor does not agree to modify their existing contracts with the EO 14398 clause, the agency may terminate the contract for convenience.

The guidance, paired with the FAR Council’s recent request to begin mandatory EO 14398 DEI disclosures, signals EO 14398 enforcement is imminent. However, contrary to recent speculation, there is no indication these inquiries will take the form of full DEI “audits” by agency contracting officers.

What You Should Do

Federal contractors can prepare for agency enforcement of EO 14398 by taking the following steps:

• Verify whether FAR 52.222-90 is being added to contract awards, modifications, and renewals.
• Flow the clause down to subcontractors at all tiers, but only after the clause has been integrated into a new or existing contract.
• Continue to review DEI-related policies and programs on an annual basis.

CWC’s DEI Risk Assessment Package supports compliance planning for organizations wanting to proactively evaluate risk.

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