This week, in the midst of ongoing legal battles, the U.S. Equal Employment Opportunity Commission (EEOC) issued new guidance on Diversity, Equity, and Inclusion (DEI), alongside a one-page technical assistance document issued jointly with the Department of Justice. Consistent with the present administration’s anti-DEI policy agenda, the new guidelines emphasize ways in which DEI practices could constitute unlawful discrimination against historical majority groups under Title VII of the Civil Rights Act of 1964 (Title VII). Missing, though, is context about DEI’s origins and remedial purpose: to reduce bias in employment decisions and prevent unlawful discrimination against marginalized groups. Employers who have established DEI programs with the goal of improving workplace equal opportunity find themselves in a difficult position.
Wednesday’s guidance follows EEOC Acting Chair Andrea Lucas’s 20 public letters to prominent law firms the day before, requesting detailed information about the firms’ DEI-related employment practices. The letters seek data on hiring practices, compensation structures, and the demographics of employees participating in diversity programs, with the stated purpose to assess compliance with Title VII of the Civil Rights Act of 1964. But critics including former EEOC officials have retorted that the Acting Chair’s letters cannot legally compel a response from the firms because the EEOC has not demonstrated the requisite justification for a directed investigation, and that if they did, the letters must be confidential.
These actions fuel debates pending in lawsuits challenging January’s anti-DEI executive orders. The plaintiffs include diversity officers and organizations whose missions advance DEI-related principles. The EOs, the complaints allege, violate the plaintiffs’ First Amendment rights in that they are too vague to put the plaintiffs on notice of conduct that would violate the law. Those who claim the orders are unconstitutional point to rhetoric such as one order’s explicit heading to “deter” DEI in the private sector. These arguments initially persuaded a federal district court in National Association of Diversity Officers in Higher Education et al. v. Trump et al., 1:25-cv-00333 (D. Md.), which issued a February 21, 2025 preliminary injunction and 63-page memorandum opinion explaining its reasoning. But last Friday the Fourth Circuit Court of Appeals overruled the injunction on appeal, with one judge’s concurrence alluding to potential ripeness issues.
Another similar case seeking an injunction, National Urban League et al. v. Trump et al., is pending now in the federal district court for the District of Columbia (1:25-cv-471). The plaintiffs in that case point out that they have had grants, contracts, and subcontracts canceled because of references to diversity, and seek to persuade the court that they have met the threshold standing requirement to show a credible threat that the EOs punish speech.
That the EEOC went prominently on the offensive immediately after the Fourth Circuit stayed the District of Maryland’s injunction blocking enforcement of the EOs is yet another indicator that reducing DEI’s influence in the private sector is a high priority for the administration. Notwithstanding such efforts to entrench a narrative that DEI is a form of discrimination, employers are well served to keep in mind that properly-vetted DEI seeks to promote equal opportunity, not to detract from it. Administrative guidelines do not have the force of binding judicial precedent, so employers may not rely solely on the guidance in administering their equal-employment-opportunity compliance.
A few notes on the new EEOC guidelines, and the other legal principles of which employers need to be aware:
- The guidelines accurately point out a basic principle that has existed under the law since before most DEI programs were in place: Title VII prohibits discrimination against any individual based on a protected characteristic like race or gender. Employers cannot, nor could they before these guidelines:
- use a protected characteristic as the basis of an employment decision (guidelines section 7-9).
- subject any employee to a hostile environment based on a protected characteristic (see guidelines Section 10).
- retaliate against any employee for engaging in protected activities to oppose unlawful discrimination based on any protected category status (guidelines section 11).
- In elaborating on “when … a DEI initiative, policy, program, or practice [is] unlawful under Title VII,” the guidelines acknowledge implicitly that not all DEI initiatives are unlawful.
- While proponents and critics of DEI agree that discrimination against any group is unlawful, the legal tension lies in what constitutes unlawful discrimination, and what evidence is sufficient to prove it. DEI advocates point out that DEI is a byproduct of discrimination against minority groups and would disclaim an intention to discriminate against others in the process. Of course, the potential to violate others’ rights exists within DEI as it does within any workplace practice.
- The guidelines assert that the EEOC applies the same evidentiary standard to all discrimination claims and take the position that “there is no such thing as ‘reverse’ discrimination; there is only discrimination.” The EEOC’s position is not wholly reflective of judicial precedent, as courts routinely cite the reverse discrimination concept in their rulings. (E.g., Schaffhauser v. United Parcel Serv., Inc., 794 F.3d 899, 903 (8th Cir. 2015) (“In a reverse-racism case, the plaintiff must also show that ‘background circumstances support the suspicion that the defendant is that unusual employer who discriminates against the majority” (citation and internal quotations omitted); Farr v. St. Francis Hosp. & Health Centers, 570 F.3d 829, 833 (7th Cir. 2009) (“because his is a reverse sex discrimination case, a modified test [applies].”)
- Apropos of this, a footnote in the guidelines calls attention to the pending Supreme Court case Ames v. Ohio Department of Youth Services (No. 23-1039), in which the Court will likely clarify the evidentiary standard in reverse discrimination cases, a tacit admission that, at least in some courts, the test for whether a plaintiff survives summary judgment on a discrimination claim differs depending on whether the plaintiff is from a historically marginalized group.
- Though not cited in the new guidance, Supreme Court precedent exists to support consideration of factors like race or gender if pursuant to a valid voluntary affirmative action plan, e.g., to remedy a “manifest imbalance” affecting a protected group, provided that it that does not “unnecessarily trammel” the interests of employees outside the group. Johnson v. Transportation Agency, Santa Clara Cnty., Cal., 480 U.S. 616, 632, 107 S. Ct. 1442, 1452, 94 L. Ed. 2d 615 (1987). At present, the Johnson decision remains good law.
- “Affirmative action” terminology has become the subject of much confusion following the Supreme Court’s 2023 higher-education decision in Students for Fair Admissions, Inc. v. President and Fellows of Harvard College and Students for Fair Admissions, Inc. v. University of North Carolina. But as many employers are aware, from 1965 until January 2025, many federal contractors were required to develop affirmative action plans under the recently-rescinded Executive Order 11246.
- The guidelines mention the “bona fide occupational qualification” (BFOQ) exception, which may in limited cases permit disparate treatment if necessary for a job. One such application of the BFOQ defense is for the “purpose of authenticity or genuineness.” (29 CFR 1604.2(a)(2).) As the 2025 guidelines emphasize, the BFOQ exception expressly excludes race or color. But courts also recognize a defense related to the First Amendment in the context of creative or artistic expression, leading to upholding race-based casting decisions (see, for example, Moore v. Hadestown Broadway Ltd. Liab. Co., 722 F. Supp. 3d 229, 260 (S.D.N.Y. 2024)).
- The new guidelines focus on “disparate treatment” and omit reference to disparate-impact discrimination, another basis for liability under Title VII. Specifically, an employer violates Title VII’s disparate-impact provisions when it “uses a particular employment practice that causes a disparate impact on the basis of race, color, religion, sex, or national origin and the respondent fails to demonstrate that the challenged practice is job related for the position in question and consistent with business necessity”. 42 U.S.C. § 2000e–2(k)(1)(A)(i); see also Griggs v. Duke Power Co., 401 U.S. 424 (1971). DEI may offer tools for complying with Title VII’s disparate-impact provisions; at the same time, efforts to avoid disparate impact do not license employers to engage in disparate treatment. The interplay between disparate treatment and disparate impact is complex. (See, for example, Ricci v. DeStefano, 557 U.S. 557, 578, 129 S. Ct. 2658, 2673, 174 L. Ed. 2d 490 (2009)). But under the law at present, employers must endeavor to comply with both.
As the situation evolves, organizations aiming to balance DEI objectives with legal compliance will wish to stay informed and proactive. PLG’s Executive Orders taskforce continues to monitor ongoing developments.
