Justice Department Erases Disparate Impact Liability From Title VI Enforcement Regulations

Quick Hits

• The U.S. Department of Justice recently published a final rule eliminating liability for disparate impact discrimination for organizations that receive federal money.
• Intentional discrimination, including disparate treatment based on race, color, or national origin, remains unlawful under Title VI.
• The rule took effect immediately.

Title VI of the Civil Rights Act of 1964 prohibits employment discrimination based on race, color, or national origin in any program or activity that receives federal funding. Title VI prohibits employment discrimination only if employment is a primary objective of the federal investment, and the alleged discriminatory employment practices negatively affect the delivery of services to the program’s ultimate beneficiaries, such as students, patients, or those served by government agencies.

Disparate impact generally refers to when a neutral policy or practice disproportionately and negatively affects a legally protected group. Disparate impact does not require plaintiffs to prove an intent to discriminate existed. The original rule and regulations allowed agencies to consider federal-funding recipients’ policies and practices that had an alleged discriminatory effect.

The newly implemented rule clarifies that Title VI only prohibits intentional discrimination. Notably, Title VI is different from Title VII of the Civil Rights Act of 1964, which applies to all private employers with fifteen or more workers and prohibits discrimination against a broader range of protected characteristics based on disparate treatment and disparate impact theories of discrimination.

Data can still be used to prove discrimination under Title VI. The final rule states, “Eliminating disparate-impact liability does not preclude the use of data on disparate outcomes to help prove intentional discrimination. … This use of statistical disparity to help establish, as an evidentiary matter, liability for intentional discrimination materially differs from using it to impose liability for an unintentional disparate impact.”

The new rule eliminating disparate impact theory under Title VI comes on the heels of President Donald Trump’s executive order (EO) on April 23, 2025, broadly calling for an end to disparate-impact liability for discrimination and ordering federal agencies to stop enforcement of antidiscrimination laws based on disparate impact theories. The final rule aligns with that executive order.

Next Steps

Going forward, the DOJ will not pursue enforcement actions against organizations for disparate-impact discrimination under Title VI. However, some states’ antidiscrimination laws include liability for disparate impact. Employers may wish to review their policies and practices to ensure they comply with applicable state antidiscrimination laws.

In addition, in 2001, the Supreme Court of the United States found in Alexander v. Sandoval that individuals lack a private right of action to sue for disparate-impact discrimination under Title VI.

In defense against discrimination lawsuits, employers can present evidence that their employment decisions were based on valid business reasons, such as seniority, skill, education level, or business needs. Employers may wish to carefully document their nondiscriminatory reasons for hiring, firing, promoting, or demoting an employee. They also can track workforce analytics over time to determine if protected groups are experiencing disparate impacts. Such information may be useful for business strategy, recruiting, and retention, even when disparate-impact liability is not present.

Ogletree Deakins’ Diversity, Equity, and Inclusion Compliance Practice Group, Government Contracting and Reporting Practice Group, Higher Education Practice Group, and Workforce Analytics and Compliance Practice Group will continue to monitor developments and will provide updates on the Diversity, Equity, and Inclusion Compliance, Employment Law, Government Contracting and Reporting, Higher Education, and Workforce Analytics and Compliance blogs as new information becomes available.

This article and more information on how the Trump administration’s actions impact employers can be found on Ogletree Deakins’ Administration Resource Hub.

Nonnie L. Shivers is a shareholder in Ogletree Deakins’ Phoenix office.

This article was co-authored by Leah J. Shepherd, who is a writer in Ogletree Deakins’ Washington, D.C., office.

Follow and Subscribe
LinkedIn | Instagram | Webinars | Podcasts