DEI Bias Is Tough to Prove Despite Evolving Legal Landscape

Workers emboldened by the Trump administration’s push to eradicate diversity, equity, and inclusion programs will meet substantial legal hurdles in proving that DEI efforts led companies to discriminate against them.

The Equal Employment Opportunity Commission and the Justice Department recently issued guidance targeting discriminatory DEI practices, signaling a desire to find cases that the agencies or workers can eventually bring in court, employment law scholars and attorneys said.

“The agenda around the guidance is to increase interest in filing these charges among employees, and to be candid, probably to chill employers from continuing or expanding” efforts to attract a broad, diverse pool of job candidates and retain an inclusive workforce, said Corey Devine, a partner at management-side firm Muskat Devine LLP.

But plaintiffs must meet difficult—and evolving—legal standards to prevail in a discrimination lawsuit under Title VII of the 1964 Civil Rights Act..

Those obstacles include showing that DEI caused harm to a worker, such as a termination or a promotion rejection. Claims alleging that diversity programs created a racially hostile work environment would also have to meet a high threshold to show any harassment was “severe or pervasive.”

Allies of the president have long urged the EEOC to probe corporate DEI programs at large companies and organizations—including Activision Blizzard Inc., International Business Machines Corp., Macy’s Inc., and Major League Baseball. They claimed those policies may violate Title VII by boosting representation of women and racial minorities at the expense of White, heterosexual men.

“I’m absolutely sure that this part of their campaign will succeed,” said worker-side lawyer Paul Mollica. “They’ll get a flood of” charges that might lead to agency investigations and ultimately lawsuits in federal court if the EEOC determines there’s “reasonable cause” to sue, he said.

Shifting Requirements

A subsequent EEOC question-and-answer document further explained how workers can use Title VII to go after DEI-related efforts like anti-bias training and employee resource groups, which consist of workers with common interests and shared identities, such as gender and race.

But proving that race or sex played a role in an adverse employment action is where the rubber meets the road. Such cases have so far seen mixed results in federal court.

For example, the US Court of Appeals for the Seventh Circuit last July ruled against a White engineer who alleged Honeywell International Inc. discriminated and retaliated against him because he refused to take mandatory DEI training about unconscious bias.

Last week, however, a Michigan federal judge allowed an ex-IBM White male managing consultant to proceed with claims that the company’s DEI program may have contributed to his dismissal. In that case, the judge found that the employee plausibly alleged that IBM’s diversity policy showed “background circumstances” suggesting that the company was a rare employer discriminating against workers in the “majority.”

Going forward, workers seeking to challenge DEI programs as discriminatory will likely be able to use new US Supreme Court precedent to back up their claims. The high court appears poised to remove the “background circumstances” requirement, which had been adopted by five circuit courts.

The justices also arguably made it easier for workers to prove DEI discrimination with its 2024 Muldrow v. St. Louis decision, which allows workers only to show they experienced “some harm” by an unfavorable workplace decision.

Causation, Pretext

The EEOC’s Q&A states that workers can use the more lenient “motivating factor” standard when bringing cases to court. This standard—one of two ways of determining Title VII liability and relief—requires a plaintiff to show that their protected trait was a motivating factor for an adverse job action.

Still, plaintiffs haven’t widely used this standard because it only allows declaratory or injunctive relief and attorneys’ fees and costs, scholars and attorneys said.

The higher “but-for” standard—requiring a showing that a protected trait was the central cause—is the preferred alternative route, they said, as plaintiffs can obtain reinstatement, back pay, and damages.

“Motivating factor” still has some advantages for plaintiffs, attorneys said.

While the standard can lead to minimal victories for plaintiffs, that verdict can be “still very damaging to companies,” Mollica said.

“A jury ruling finding you discriminated on the basis of sex or race and a judgment can have collateral effects if the employee continues to be employed at the company,” he added. “That judgment can be very valuable.”

Another key issue can crop up in cases where workers must rely on indirect evidence of bias. They ultimately must show that an employer’s stated reasons for its actions were actually a pretext for discrimination.

Meeting this threshold is difficult even outside the DEI context.

For example, the Seventh Circuit in 2022 ruled against a White athletic director in South Bend, Ind., who failed to establish pretext. He didn’t show race discrimination caused him to be passed over for two jobs in favor of Black applicants.

Hostile Environment

Meanwhile, there’s scant case law on when DEI can create a hostile work environment under Title VII.

The Tenth Circuit last year affirmed the dismissal of a White officer’s case against the Colorado Department of Corrections, citing a lack of evidence that the agency’s anti-bias training was race-based harassment. However, two circuit judges said that training could create a hostile environment when combined with ongoing racial stereotyping or expectations of discriminatory treatment.

A Pennsylvania federal judge this month granted summary judgment against a Penn State professor who failed to prove that anti-racism training and discussions regarding White privilege are unlawfully hostile.

Plaintiffs “tend to downplay the level of evidence you need to show that a mandatory DEI training would create a severe or pervasive racially hostile environment,” said Michael Foreman, a professor at Penn State Law.

Some courts are weighing whether to apply Muldrow in harassment cases to replace the severe or pervasive standard.