DEI Under Scrutiny, Part I: Increased Challenges to DEI Programming Give Employers a Reason to Perform Risk Assessments

On November 16, 2023, Charlotte Burrows, chair of the U.S. Equal Employment Opportunity Commission (EEOC), spoke at the 2023 Artificial Intelligence & Employment Compliance Conference, a gathering hosted by the Institute for Workplace Equality, a nonprofit employer membership association formed to assist the federal contractor community in responding to rapidly changing compliance challenges. Chair Burrows provided an update on the EEOC’s priorities and initiatives. Top of mind for many attendees was the growing number of challenges to employers’ diversity, equity, and inclusion (DEI) programs.

Quick Hits

• Employers have been facing an increasing number of challenges to their DEI programming and initiatives in a variety of forums in the wake of the Supreme Court’s ruling banning race-based admissions in higher education earlier this year.
• Employers may want to consider conducting a privileged risk assessment of their DEI programming and initiatives to assess potential legal risks associated with their diversity and inclusion efforts.

As Chair Burrows explained, the legal landscape for workplace DEI programs has not actually changed as a result of the Supreme Court of the United States’ decision to strike down race-based affirmative action in higher education admissions. But what has changed is the amount of scrutiny such programs are facing, making now an opportune time for employers to take a closer look at their current DEI programming and initiatives.

The DEI Legal Landscape

Challenges to employers’ DEI initiatives continue to rise, as activist groups, investors, certain state attorneys general, and employees attack such programs on multiple fronts—for example, by filing lawsuits or encouraging the EEOC to investigate various initiatives through Commissioners’ Charges. Employers’ programs are being challenged under various federal and state laws, including through the filing of reverse discrimination claims under Title VII of the Civil Rights Act of 1964 and race-based contracting claims under Section 1981 of the Civil Rights Act of 1866. Of interest to federal contractors, according to Office of Federal Contract Compliance Programs’ (OFCCP) data on completed discrimination compliance evaluations and complaint investigations, in fiscal year 2023, 1,581 male and/or white class members were alleged victims of discrimination, making them the third largest group (by total number and percentage), behind Black and female class members. Against this backdrop, employers may want to consider doing a privileged deep dive into their DEI programming and initiatives.

DEI Risk Assessments

Using a risk-assessment model, employers can consider their potential legal exposure on a continuum. While the Supreme Court’s affirmative action decision has not changed the laws affecting employers today, it remains to be seen whether the various challenges filed over the last five months will ultimately reshape any aspects of the legal landscape for employers and their workplace DEI programming. And under the current laws, certain employer-initiated DEI programs may present a greater legal risk than others. While employers may be able to rely in good faith on the EEOC’s guidance on voluntary affirmative action programs to shield them from Title VII liability—and federal contractors are required by law to create certain affirmative action programs—the legal landscape is complicated, and potentially evolving. By undertaking privileged reviews, employers can identify potential compliance issues and make careful and critical assessments of the associated risks, as well as best practices, related to their DEI efforts.

Looking Ahead

This article is the first part of Ogletree Deakins’ “DEI Under Scrutiny” series, an examination of the DEI legal landscape in the wake of the Supreme Court’s decision on race-conscious admissions in higher education in Students for Fair Admissions, Inc. v. Harvard College. Part two of the series focuses on additional considerations related to employers’ environmental, social, and governance (ESG) commitments.

Ogletree Deakins’ DEI Task Force—a multidisciplinary team of lawyers from our Diversity and Inclusion, Environmental, Social, and Governance (ESG), Litigation, OFCCP Compliance, Government Contracting, and Reporting, and Pay Equity practice groups—counsels employers on advancing lawful DEI and ESG efforts.

For more information on the implications of the Supreme Court’s affirmative action decision for DEI initiatives, together with related risk considerations for employers, please join us for our upcoming webinar, “Performing a Risk Assessment of DEI Programming,” which will take place on Wednesday, December 6, 2023, from 2:00 p.m. to 3:00 p.m. (EST). The speakers, Shafeeqa W. Giarratani and T. Scott Kelly, will discuss the challenges employers are facing with regard to their DEI programming and initiatives and how to perform privileged risk assessments. Register here.

Ogletree Deakins will continue to monitor developments and will provide updates on the Diversity and Inclusion, Employment Law, Higher Education, and OFCCP Compliance, Government Contracting, and Reporting blogs.

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