Employers Get New Guidance on When DEI Programs Comply With Federal Law
The U.S. Equal Employment Opportunity Commission (EEOC), with the U.S. Department of Justice, clarified the legal boundaries of diversity, equity and inclusion (DEI) programs in the workplace on March 19. This guidance comes at a time when employers face questions about DEI policies and compliance.
A new technical assistance document seeks to address growing employer concerns about whether their DEI initiatives align with federal anti-discrimination laws, including Title VII of the Civil Rights Act. The agency stresses that while DEI efforts can play an important role in fostering diverse workplaces, they must be carefully structured to ensure compliance with federal law. Although the document is not legally binding, it provides guidance on how the EEOC views DEI programs, which is important, since the EEOC enforces laws against workplace discrimination. Here is what employers need to know.
EEOC’s Position on DEI and Anti-Discrimination Compliance
The guidance emphasizes that DEI programs must not result in employment discrimination against any group, including those who are not traditionally underrepresented. The EEOC warns that some DEI policies – such as hiring preferences based on race or gender – could potentially violate federal laws if they create disadvantages for those outside of the protected groups the programs are designed to support.
At the same time, the agency acknowledges that neutral, inclusive DEI programs remain legal. For example, employers may establish mentorship programs to support employees from underrepresented backgrounds, as long as participation is open to all employees and does not result in preferential treatment based on race, gender or other protected characteristics.
The EEOC also reaffirms that voluntary affirmative action programs in the private sector must be narrowly tailored. They must not impose rigid numerical targets or give automatic preference to any group. Employers who wish to implement these programs should ensure that they are based on a demonstrable business need and do not lead to reverse discrimination claims.
Implications for Employers
For private employers, the guidance serves as a notice that certain DEI initiatives could expose companies to legal challenges. The EEOC stated that it will take a neutral approach in enforcement, meaning that both traditional discrimination claims and allegations of reverse discrimination will be investigated with equal scrutiny. Employers are advised to conduct a thorough legal review of their current DEI policies to ensure they do not inadvertently create risks of litigation.
Employers seeking to comply with the EEOC’s guidance while maintaining robust DEI initiatives should focus on inclusive, non-exclusionary policies. For instance, if they offer leadership development programs that aim to increase workplace diversity, they should make them available to all employees who meet the qualification criteria. Bias training programs should be structured to educate employees on workplace inclusion without mandating specific ideological viewpoints.
In recruitment, companies can expand outreach efforts to diverse candidate pools, such as engaging with historically underrepresented universities or professional associations. The EEOC stresses that hiring decisions must be based on merit and qualifications and not race, gender or other protected characteristics.
Next Steps for Employers
Given the evolving legal landscape, employers should immediately review their existing DEI programs. This includes conducting an internal audit of hiring and promotion practices, reviewing employee training materials, and ensuring workplace affinity groups do not exclude employees based on protected characteristics.
Contact John Duke or any member of the Phelps labor and employment team with questions or for advice and guidance.
