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šŸ‡ŗšŸ‡ø How Trumpā€™s DEI changes impact the UK

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If you take just one thing from this emailā€¦

Trumpā€™s new executive orders are rolling back diversity, equity, and inclusion (DEI) policies in the US. Itā€™s led some major companies (like Meta and McDonaldā€™s) to scale back their own efforts too. But UK law is different ā€” here DEI training remains a legal expectation (and this year, the UK is making more DEI rules, introducing the Employments Right Bill). Law firms must help clients navigate pressure from US-based stakeholders while ensuring they stay compliant with UK regulations. That means reinforcing the need for DEI training, preparing for new equality reporting rules, and helping businesses balance external pressures with legal obligations.

EDITORā€™S RAMBLE šŸ—£

Last week, DeepSeek made headlines for building a super-powerful AI model (quicker and cheaper than OpenAIā€™s ChatGPT).

Since then, everyoneā€™s been talking about Jevons Paradox.

Jevons Paradox is the idea that making something more efficient doesnā€™t always mean we use less of it ā€” it can actually make us use more.

Say you buy a really fuel-efficient car. Since it uses less petrol per mile, you might assume youā€™ll spend less on fuel. But because itā€™s now cheaper to drive, you start taking longer trips or driving more often ā€” so in the end, you actually end up using more petrol overall.

So, how does this connect to DeepSeek?

DeepSeek built its AI model using Nvidiaā€™s H800 chips, which are much weaker than the H100 chips used by OpenAI and others. The US actually banned exports of those better chips to China in 2022 to try to slow down its tech development.

When DeepSeek announced they pulled this off without the most powerful chips, investors got scared. Nvidia, the biggest AI chipmaker, saw its stock drop 17% ā€” the biggest single-day loss in US history.

The fear? That AI might no longer need Nvidiaā€™s best chips.

But what if Jevons Paradox applies here? Then the opposite could happen.

If AI gets cheaper and more accessible, we wonā€™t use less of it ā€” weā€™ll use way more. That means demand for AI chips, electricity, and computing power could actually increase over time.

So making something more efficient doesnā€™t always mean you use it less ā€” it can make demand skyrocket.

- Idin

šŸ‡ŗšŸ‡ø How Trumpā€™s DEI changes impact the UK

Whatā€™s going on here?

President Donald Trump has signed two executive orders rolling back DEI efforts in the US, leading to government job cuts and corporate pullbacks on diversity policies.

What has Trump actually done?

Since taking office two weeks ago, Trump has signed two executive orders to scale back diversity, equity, and inclusion (DEI) efforts.

šŸ¤” What is an executive order? Itā€™s a rule issued by the US President which acts like a law (but without needing approval from Congress ā€” the equivalent of UKā€™s parliament).

The first executive order (Ending Radical and Wasteful Government DEI Programs and Preferencing) shuts down DEI programs in the federal government. It has meant that all people in DEI positions have been removed.

The second executive order (Ending Illegal Discrimination and Restoring Merit-Based Opportunity) targets DEI policies in government contracts. It says companies that work with the government have to avoid DEI initiatives that violate federal law.

Trump has also appointed Andrea Lucas as chair of the Equal Employment Opportunity Commission (EEOC), which enforces workplace discrimination laws.

Andrea Lucas (source)

Lucas generally opposes DEI-based policies and backs a traditional view of sex and gender in US law.

Whatā€™s been the impact in the US?

Trumpā€™s orders have directly led to DEI staff being fired from government agencies.

Theyā€™ve also resulted in major companies scaling back diversity efforts:

Even though the executive orders donā€™t force them to change, private companies are backing away from DEI.

How does this impact the UK?

The short answer? It doesnā€™t ā€” UK law is different from US law.

Here are some examples of how they differ.

āš–ļø ā€œAffirmative actionā€ vs ā€œPositive actionā€: The US had affirmative action, where race and other traits influenced hiring and admissions ā€” quotas and preferential hiring for underrepresented groups were common.

The UK, however, only allows positive action through things like mentoring schemes for minority groups. But positive discrimination (hiring based on identity over skills) is illegal. Instead, UK employers can consider backgrounds proportionally, such as factoring in school context when assessing grades.

šŸŽ“ DEI training requirements: In the US, some businesses are cutting DEI training, especially on race and gender, due to Trumpā€™s policies.

In the UK, DEI training is essential to comply with your legal obligation (particularly in preventing discrimination and harassment).

šŸ³ļøā€āš§ļø Trans protections: The US is now moving towards a legal definition of sex as strictly male or female, which removes federal recognition of gender identity.

In the UK, trans people are explicitly protected under the Equality Act 2010. There is no legal basis for rolling back these protections.

So, why should UK law firms care?

šŸ‡¬šŸ‡§ UK law isnā€™t changing, but US pressure might increase: The UKā€™s law remains firm (in fact, itā€™s getting stricter ā€” weā€™ll cover the new rules below). UK-based global businesses could face pressure from their US-based stakeholders (like their customers, clients, suppliers, or shareholders) questioning their approach to diversity and inclusion. Law firms need to help clients navigate these conversations by communicating the value of DEI, and the different position in UK law.

šŸŽ“ Training is still required in the UK: While US companies are scaling back DEI training, UK businesses must continue it. Training on discrimination and harassment prevention is explicitly recommended by the UK Equality and Human Rights Commission, so stopping it could increase the risk of claims. Law firms should remind clients that keeping up with training isnā€™t just good practice ā€” itā€™s a legal requirement.

šŸ“œ New rules are coming: The Employment Rights Bill comes into effect later this year (itā€™s been called "the biggest change to workers' rights in 50 years"). The new law will require big companies (over 250 employees) to publish an equality action plan (including an explanation for their gender pay gap, the steps theyā€™re taking to improve workplace equality, and how they support employees going through menopause). In the future, reporting rules may expand to include ethnicity and disability pay gaps, so companies need to prepare now. So, while the US is scaling back ā€” the UK seems to be heading in the opposite direction.

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IN OTHER NEWS šŸ—ž

  • šŸš— American Axle (a US auto giant) has bought Dowlais (a UK car parts firm) in a Ā£1.1 billion deal. A&O Shearman is advising American Axle, and Dowlais is being advised by Slaughter and May and Cravath. The deal is part cash, part stock, meaning American Axle is paying some of the price in cash and some in its own shares. As Dowlais was listed in London, this is another example of a company leaving the London Stock Exchange ā€“ a worrying trend for the UK market.

  • šŸ’° Google has been fined ā‚¬4.13 billion by the EUā€™s top court. The European Commission ruled that Google forced phone makers to pre-install Google Search and Chrome, blocked modified versions of Android, and paid manufacturers to stick with Google Search. After years of legal battles, it was decided that the fine (the biggest in EU history) still stands.

  • šŸ‡ŗšŸ‡ø Linklaters has hired a top team of New York litigators as part of its US expansion. They hired four partners from boutique firm Patterson Belknap, a team that has worked with major US corporations like Johnson & Johnson. Instead of merging with a US firm, Linklaters is looking to bring top talent into its own firm. Since it ditched its lockstep pay model, itā€™s had more flexibility to compete with US rivals on compensation.

  • ā›½ A UK court ruled that permission for two new Scottish oil and gas fields had been granted unlawfully. They decided the environmental impact assessment did not account for the emissions from burning the extracted fuel. The companies must now seek fresh approval, which consider these emissions (and climate activists will fight against it). The energy companies involved, Equinor and Ithaca, were advised by CMS and Pinsent Masons.

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  • šŸ“¹ļø Free application help: If you're applying to commercial law firms, check out my YouTube channel for actionable tips and an insight into the lifestyle of a commercial lawyer in London.

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