Key Points
- Employers can expect their DEI programs to face resistance from both the federal government and private parties during President-elect Trump’s second term, emboldened in part by recent Supreme Court decisions.
- The president-elect could reinstate his 2020 executive order that prohibited diversity training in federal agencies, and the Heritage Foundation’s Project 2025 suggests eliminating several federal programs and practices supporting DEI policies.
- Republicans will almost certainly gain majority control of the EEOC, potentially increasing pressure on the private sector to refrain from DEI initiatives.
- Broadening definitions of diversity and developing race-neutral approaches to hiring may help employers seeking to promote diverse work forces withstand legal challenge.
Employers should prepare for continued challenges to their diversity, equity and inclusion (DEI) programs during President-elect Donald Trump’s second presidency.
In the wake of George Floyd’s murder and the widescale protests that followed, many U.S. employers vowed to take action to increase racial diversity within their organizations. Some introduced or supplemented DEI programs and initiatives, including broader recruiting outreach, conferences, internships, training, mentorship programs, compensation incentives and aspirational goals, with the view that a more diverse workforce helps better serve the communities in which the companies operate.
Opponents of DEI condemned these efforts as divisive, racist and oppressive.
In one of the first Trump administration’s early efforts to curtail DEI initiatives, President Trump signed an executive order in September 2020 prohibiting the federal government and government contractors from conducting diversity training, which the executive order characterized as “offensive and anti-American race and sex stereotyping and scapegoating.”
The Trump administration also established a hotline to report those who conducted such training in violation of the executive order. Though President Joe Biden rescinded the order after taking office, more anti-DEI action along these lines is expected when President-elect Trump returns for a second term.
The Heritage Foundation’s Project 2025 may provide insight into some areas of focus for President-elect Trump’s upcoming term, especially because several of his proposed cabinet appointees had a hand in its development.
As stated on its website, Project 2025 “advocates for the end of divisive, race-based, anti-American propaganda like DEI in the federal workforce.” Among other actions, it suggests eliminating:
- Disparate impact, which imposes liability on entities, including employers, with policies or practices that have a discriminatory impact on members of protected groups.
- Race and ethnicity data collection by the Equal Employment Opportunity Commission (EEOC).
- The Office of Federal Contract Compliance Programs, which currently exists to ensure federal contractors abide by laws and regulations requiring nondiscrimination and affirmative action.
The incoming administration will also be in a position to make changes at the EEOC. Currently, the EEOC is comprised of four commissioners — three of whom were nominated by President Biden — as well as one vacancy and a general counsel. The terms of all Democratic commissioners and the general counsel will end during the Trump presidency, giving the administration the opportunity to nominate a majority of EEOC commissioners by the end of 2026.
Following the U.S. Supreme Court’s June 2023 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 (SFFA), EEOC Commissioner Andrea Lucas, a Trump appointee, criticized “race-conscious corporate initiatives” and encouraged employers to “take a hard look at their diversity programs.”
If the EEOC shifts to a Republican majority, it is likely to take a similarly critical stance against DEI in the corporate setting.
The Supreme Court’s decisions in SFFA and Muldrow v. City of St. Louis (described below) further evidence the challenges that DEI programs may continue to face in the courts. SFFA did not directly impact employment law, but the decision emboldened plaintiffs, including nonprofit groups and individuals, to challenge corporate DEI programs.
Conservative activists have filed EEOC charges against airlines, retailers, sports leagues, law firms, accounting firms and many others with strong public commitments to DEI, alleging that their respective DEI practices are illegal and discriminatory. (See our June 2024, March 2024 and December 2023 articles on this topic.)
Challenges to DEI efforts may receive additional support from the courts as well.
Others have tried a different tactic: public pressure. An individual with more than 738,000 followers on X has used his platform to encourage consumers to boycott employers with strong DEI programs. Under this type of pressure, many Fortune 100 companies and law firms have discontinued or significantly modified their DEI programs.
Challenges to DEI efforts may receive additional support from the courts as well. The Supreme Court’s decision in Muldrow lowered the standard for the degree of harm an employee must experience to claim discrimination under Title VII of the Civil Rights Act, making it easier for such claims to survive early stages of litigation.
Recently, in a 9-8 decision, the U.S. Court of Appeals for the Fifth Circuit vacated Nasdaq Stock Market’s board diversity rules, which had required Nasdaq-listed companies to (i) publicly disclose the total number of company board members and how those board members self-identify regarding gender, predefined race and ethnicity categories, and LGBTQ+ status; and (ii) have at least two diverse board members (or explain why it does not). Though not rooted in anti-discrimination law, the decision is another setback for DEI efforts. (See also “A Significant Shift Away From ESG and Toward Crypto Is Expected at the SEC.”)
And in February 2025, the Court will hear arguments in Ames v. Ohio Department of Youth Services, to determine whether members of a majority group are required to meet a heightened pleading standard to prove “reverse” discrimination claims.
In that case, a heterosexual female plaintiff alleged that her employer declined to promote her and subsequently demoted her, in each case, because of her sexual orientation. The district court granted summary judgment in favor of the employer, reasoning that the plaintiff did not offer sufficient evidence of “background circumstances to support the suspicion that the defendant is that unusual employer who discriminates against the majority.”
The U.S. Court of Appeals for the Sixth Circuit affirmed, applying the same standard as the district court. The outcome of this case at the Supreme Court will implicate the standard that majority plaintiffs must satisfy in alleging reverse discrimination and may make it easier for plaintiffs to bring reverse discrimination claims, including claims that challenge DEI initiatives.
Even in the face of the ever-increasing scrutiny of DEI, many employers have doubled down on their commitments. Employers have removed race- and sex-based employment criteria and broadened their definitions of diversity to include race-neutral components, as we discussed in June 2024. And many public companies, even if not required, may continue to provide some level of board diversity data on a voluntary basis.
Employers may also introduce interview questions or essays to evaluate qualities the employers seek in employees, such as ability to overcome adversity, leadership potential, work ethic and teamwork. These kinds of efforts are likely to withstand scrutiny, as long as the revised criteria are not used as proxies for race, sex or other protected characteristics.
See the full 2025 Insights publication
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