Since taking office on January 20th, the Trump Administration has issued a series of Executive Orders relating to DEI including Executive Order 14151 and Executive Order 14173. Since then, the ambiguity surrounding the scope of executive orders targeting “illegal DEI” has created a lot of confusion regarding DEI program impacts. There have also been many legal challenges.
As of March 14th, the U.S. Court of Appeals for the Fourth Circuit granted the federal government’s request to stay a district court’s injunction issued on February 21, 2025 relating to EO 14151 and EO 14173. This means, pending appeal, that the following is currently allowed:
- Federal agencies can now implement the “Termination Provision” – terminating all equity-related grants or contracts within 60 days.
- Federal agencies can now require federal contractors and grantees to certify compliance with respect to all federal anti-discrimination laws and that they do not “operate any programs promoting DEI that violate Federal anti-discrimination laws.”
- Federal agencies now may bring enforcement actions against private sectors regarding “illegal DEI.”
Despite the federal government's stay being granted, pending appeal, the definition of "illegal DEI" has remained ambiguous. In response, on March 19, 2025, the EEOC and DOJ issued two technical assistance documents, What to Do if You Experience Discrimination Related to DEI at Work and What You Should Know About DEI-Related Discrimination at Work, to provide guidance on unlawful discrimination under Title VII of the Civil Rights Act as it pertains to DEI in the workplace. Specifically, the EEOC and DOJ clarified, most notably, the following:
Illegal DEI: “Under Title VII, an employer initiative, policy, program, or practice may be unlawful if it involves an employer or other covered entity taking an employment action motivated—in whole or in part—by race, sex, or another protected characteristic.” This is not a new standard and is how Title VII is currently applied.
Disparate Treatment: DEI related discrimination can occur in all aspects of the employment process, including hiring, firing, demotion, compensation, fringe benefits, exclusion from training, mentoring or sponsorship programs, and fellowships, and in the selection of interviews (including placement on candidate slates). This is not a new standard and is how Title VII is currently applied.
Limiting, Classifying, Segregating: Title VII also prohibits employers from limiting, segregating, or classifying employees based on race, sex, or other protected characteristics in a way that affects their status or deprives them of employment opportunities. The EEOC and DOJ lists these specific examples: “Limiting membership in workplace groups, such as Employee Resource Groups (ERG) or other employee affinity groups, to certain protected groups; or separating employees into groups based on race, sex, or another protected characteristic 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.”
Employers can maintain inclusive workplaces amidst the uncertain legal landscape by prioritizing legal compliance. Employers should use the EEOC and DOJ guidelines when examining internal DEI programs to ensure equal treatment without violating anti-discrimination laws. As a reminder, all hiring, promotion, and training practices must comply with “merit-based” standards and qualifications instead of standards based on protected characteristics including but not limited to race and gender. Additionally, any DEI resources such as groups and mentorships should be open to all employees, regardless of protected characteristics.
We anticipate more litigation over this guidance as some of the guidance and standards potentially conflict with current case law. Cascade is closely monitoring the federal DEI landscape and will keep you informed of any changes or updates.