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The Equal Employment Opportunity Commission (“EEOC”) and the Department of Justice (“DOJ”) have issued communications alerting employers to the potential for unlawful discrimination arising from diversity, equity and inclusion (“DEI”) programs.

The EEOC and DOJ explain that DEI is a broad term that is not defined in Title VII of the Civil Rights of Employment Act §§42 U.S.C. 2000e-2, et seq. (the “Act”), which prohibits discrimination on the basis of an employee’s or applicant’s protected characteristics. In the press release, the agencies caution that DEI programs “may be unlawful if they involve an employer or other covered entity taking an employment action motivated – in whole or in part – by an employee’s or applicant’s race, sex, or another characteristic.”

EEOC Guidance

There are two documents (both are posted on the EEOC’s website) that are “focused on educating the public about unlawful discrimination related to ‘diversity, equity and inclusion (DEI)’ in the workplace.” The first is a one-page technical assistance document titled “What To Do If You Experience Discrimination Related to DEI at Work.” The second, a longer set of frequently asked questions is titled “What You Should Know About DEI-Related Discrimination at Work.”

In “What To Do If You Experience Discrimination Related to DEI at Work,” the EEOC offers guidance on what type of DEI initiatives are prohibited by the Act. In general terms, the EEOC states that DEI programs which include action taken on the basis of an employee’s or applicant’s protected status would run afoul of the Act. The EEOC provides a non-exhaustive list of examples that may constitute “DEI-related discrimination,” including, but not limited to, the following:

• Applying quotas or otherwise “balancing” a workforce by race, sex, or other protected characteristics;
• Excluding employees from certain benefits, training, mentorship or sponsorship programs, or fellowships based on their protected characteristics;
• Selecting interview candidates, including placement on candidate slates, based on their protected characteristics;
• Limiting membership in workplace groups, such as “Employee Resource Groups” or other employee affinity groups, to certain protected classes;
• Separating employees into groups based on their protected characteristics when “administering DEI or other trainings, or other privileges of employment, even if the separate groups receive the same programming content or amount of employer resources.”

The EEOC also warns that “DEI training may give rise to a colorable hostile work environment claim” under certain circumstances, and an employee’s “[r]easonable opposition to a DEI training may constitute protected activity if the employee provides a fact-specific basis for his or her belief that the training violates Title VII.”

In “What You Should Know About DEI-Related Discrimination at Work,” the EEOC presents information in a “frequently asked questions” format (hereafter, the “FAQs”). In addition to providing the above-stated examples of DEI-related conduct prohibited by the Act, the EEOC confirms the following in the FAQs:

• The Act protects all employees, applicants, and training or apprenticeship program participants, regardless of whether they are part of a minority group.
• The EEOC applies the same standard of proof to all race discrimination claims, regardless of the person’s race. The EEOC will not require a higher showing of proof for so-called “reverse discrimination” claims or claims that an employer has discriminated against a majority group.
• “Client or customer preference” is not a defense to race or color discrimination. The EEOC states that “[b]asing employment decisions on the racial preferences of clients, customers, or coworkers constitutes intentional race discrimination.”
• “[B]usiness interests or necessity” do not justify preference over one group of employees for another on the basis of their protected status. The EEOC states that “[n]o general business interests in diversity and equity (including perceived operational benefits or customer/client preference) have ever been found by the Supreme Court or the EEOC to be sufficient to allow race-motivated employment actions.”
• Employers can raise a bona fide occupational qualification as an affirmative defense where an individual’s religion, sex or national origin is a bona fide occupational qualification “reasonably necessary to the normal operation of that particular business or enterprise.” This defense cannot be used in cases alleging disparate treatment on the basis of race.
• Employer DEI training may constitute workplace harassment when it is “discriminatory in content, application, or context.” To the extent that such training is discriminatory in “design, content, or execution,” it may give rise to a hostile work environment claim. While the FAQs do not provide concrete examples of DEI training content that may violate Act, they state in a footnote that “unconscious bias training” may be problematic.

The FAQs further reiterate that “opposing unlawful employment discrimination related to an employer policy or practice labeled as ‘DEI’” may constitute protected activity that gives rise to a claim for retaliation.

DOJ GUIDANCE

Attorney General Pam Bondi also issued a memorandum to federal agencies entitled “Guidance for Recipients of Federal Funding Regarding Unlawful Discrimination” (DOJ Memo). The stated purpose of this DOJ guidance is to identify “‘Best Practices’ as non-binding suggestions to help entities comply with federal antidiscrimination laws and avoid legal pitfalls.” The memo goes on to clarify that “these are not mandatory requirements but rather practical recommendations to minimize the risk of violations.”

While the DOJ memo is directed at entities receiving federal funding, it is important for all employers to consider the examples of unlawful discrimination.

The memo lists the following examples of unlawful policies and practices:

1. “Granting Preferential Treatment Based on Protected Characteristics.” Any treatment that provides opportunities, benefits or advantages to individuals based on protected characteristics violates federal anti-discrimination laws unless they meet very narrow exceptions. Examples of prohibited practices include race-based scholarships or programs, preferential hiring or promotion practices, or access to facilities or resources based on race or ethnicity.
2. “Prohibited Use of Proxies for Protected Characteristics.”  Ostensibly neutral criteria that function as substitutes for explicit consideration of protected characteristics may become legally problematic if they are selected because they correlate with protected characteristics or are implemented with the intent to advantage individuals based on protected characteristics. Examples include the use of selection criteria that advantage candidates who have experiences associated with certain racial groups (e.g. asking faculty candidates to describe how their cultural background informs their teaching), targeting specific areas, institutions, or organizations because of their racial or ethnic composition in recruiting individuals, and requiring applicants to “describe obstacles they have overcome” or to submit a “diversity statement” in a manner that advantages those who discuss experiences intrinsically tied to protected characteristics.

“Segregation Based on Protected Characteristics.” When an entity organizes programs, activities or resources in a way that separates or restricts access based on protected characteristics, such conduct violates anti-discrimination law regardless of the stated goal with narrow exceptions such as correctional facilities where segregation has been recognized as a compelling institutional interest.  Note that this does not preclude segregation based on sex in the context of athletic competitions and intimate spaces; in fact, the DOJ states that failure to affirm “sex-based boundaries rooted in biological differences” risks violation of federal law.

1. “Unlawful Use of Protected Characteristics.” Use of race, sex, or other protected characteristics as a basis for selecting candidates for employment or other contracts or program participation, or policies that explicitly mandate representation of specific groups in candidate pools, such as “diverse slate” requirements, violate anti-discrimination law by creating unequal treatment, regardless of intent to advance diversity goals.
2. “Training Programs that Promote Discrimination or Hostile Environments.” DEI training programs may be in violation of antidiscrimination laws if they stereotype, exclude or disadvantage individuals based on protected characteristics or create a hostile environment. This includes using presentations, videos or other workplace training materials to single out, demean or stereotype individuals based on protected characteristics. DEI trainings must not “single out particular groups as inherently racist or sexist” such as references to white privilege or toxic masculinity, for example.

The memo further offers “Best Practices,” which include:

• Ensure inclusive access to all workplace programs, activities, trainings and resources for all qualified individuals regardless of protected characteristics; except “[s]ome sex separation is necessary where biological differences implicate privacy, safety, or athletic opportunity.”
• Focus on specific, measurable skills and qualifications directly related to job performance or program participation when selecting candidate pools, hiring panels, and final selections. Discontinue any program or policy designed to prioritize individuals based on racial, sex based, or protected characteristics. For example, scholarship programs must not target “underserved geographic areas” or “first-generation students.”
• Before implementing facially neutral criteria in hiring, promotions, or selecting contracts, evaluate whether they may be proxies for race, sex, or other protected characteristics. Document legitimate rationales (demonstrably related to legitimate, nondiscriminatory institutional objectives) for any criteria that might correlate with protected characteristics and ensure enforcement of the criteria aligns with the rationales.
• Include nondiscrimination clauses in third party contracts and monitor compliance requiring third parties to comply with federal law and specify that federal funds cannot be used for programs that discriminate based on protected characteristics.
• Establish clear anti-retaliation procedures and safe reporting mechanisms for employees.

Takeaways

While these are guidance documents that do not have the force of law, they illustrate that, under the current administration, the EEOC will closely scrutinize corporate DEI-related activities.  This represents a dramatic shift from the EEOC’s priorities under prior administrations.

To minimize exposure to unlawful discrimination claims, employers should carefully consider their current policies, trainings,  and programs, including a review of whether any facially neutral criteria could be viewed as proxies or correlate with protected characteristics.

The EEOC guidance does not prohibit DEI programs that work to encourage inclusivity of all employees in the workplace; such programs only risk violations if they prefer one group of employees in a protected class over another when offering trainings, employment or promotion opportunities, benefits, or anything else of value to employees.

For specific questions about how these changes may affect your organization, please contact us.

The U.S. Supreme Court ruled that a retired fighter with Parkinson’s disease is barred from bringing a claim under the Americans with Disabilities Act (“ADA”) over her post-employment health benefits because the ADA only covers employees who are “qualified individuals.” (Stanley v. City of Sanford (2025)145 S.Ct. 2058, 222 L.Ed.2d 331.)

Karyn Stanley, a former firefighter for the City of Sanford, Florida retired early when she developed Parkinson’s disease.  The City of Sanford offered health insurance until age sixty-five for employees with at least twenty-five years of service or for a limited period for employees who retired early due to disability.  In 2003, the City changed its policy for employees taking early disability retirement by providing health insurance coverage for only twenty-four months.  After receiving health insurance subsidies from the City for twenty-four  months, Stanley’s health insurance subsidies ended, prompting Stanley to file a lawsuit alleging that the City discriminated against disabled retirees in violation of Title 1 of the ADA.

The Supreme Court’s holding in Stanley focused on the definition of a “qualified individual” under Title 1 of the ADA.  Under the ADA, qualified individuals are individuals “who, with or without reasonable accommodation, can perform the essential functions of the employment position that such individuals holds or desires.”  (42 U.S.C § 1211(8).)  Justice  Gorsuch held that the present-tense language of the ADA meant “that the statute does not reach retirees who neither hold nor desire a job at the time of an alleged act of discrimination.”   (Stanley, 145 S.Ct. 2058, at 2064.)  For example, the present-tense verbs such as “discriminate against,” “can perform,” “holds or desires” signal that the ADA only “protects individuals who, with or without reasonable accommodation, are able to do the job they hold or seek at the time they suffer discrimination.”  (Id.)  It does “not reach retirees who neither hold nor desire a job at the time of an alleged act of discrimination.”  (Id.)  The Supreme Court further concluded that a “qualified individual” is a person who is currently employed or seeking employment and able to perform the essential duties of the job.  And in this case, the ADA did not apply to Stanley since, at the time the City ceased her health insurance benefits, she no longer worked as a firefighter, did not desire reemployment, and could not perform the essential functions of a firefighter.

The Stanley decision narrows the scope of standing for retired employees when bringing claims under the ADA.  Now, in order to have standing under the ADA, the plaintiffs must have a job and disability at the time of the alleged disability discrimination, not when they have already retired.

In order to best mitigate against litigation risk, it is important for employers to understand what they can and cannot do with respect to  benefits involving health coverage, disability, and retirement. Please feel free to contact us if you have questions about these topics.

In 2024 the U. S. Department of Labor (the “DOL”) implemented a new rule under the Federal Labor Standards Act (“FLSA”) regulating the minimum wage for exempt employees. The new rule (the “2024 Rule”) increased the minimum salary level for exempt workers from $684 to $844 per week (or from $35,568 annually to $43,888 annually) starting July 1, 2024.(more…)