Trump Disparate Impact Order Shifts Agency Civil Rights Mission

The Trump administration’s mandate that the EEOC stop using the disparate impact liability theory will alter the agency’s enforcement mission, erode minorities’ civil rights, and open cases for private litigation, attorneys say.

Those are key takeaways from some employment discrimination lawyers regarding President Donald Trump‘s executive order titled Restoring Equality of Opportunity and Meritocracy.

It’s unclear how many pending Equal Employment Opportunity Commission lawsuits the move will directly affect, but the policy shift will likely be felt in agency bias charge investigations and its influence could be greatest there, they said.

The US Supreme Court recognized disparate impact theory in a 1971 decision. Under the theory, an employer can be liable if a facially neutral policy adversely affects a protected class.

Trump’s order—which says it’s necessary to ensure equal protection and stem a “pernicious movement” away from a “colorblind society"—erodes civil rights of gender and racial minorities and could favor Whites, Christians and men, some attorneys said. The debate goes back decades.

The EEOC declined to comment.

Although the president’s directive restricts the commission’s available discrimination theories, it can’t take away workers’ rights to bring their own disparate impact suits under laws such as Title VII of the 1964 Civil Rights Act, the plaintiffs’ and management-side attorneys said.

The agency can sue employers on its own or after a worker files an EEOC bias charge. The bulk of its suits involve disparate treatment, or intentional bias, Jackson Lewis PC’s Patricia Anderson Pryor said. But disparate impact claims can sometimes result in bigger cases “in terms of value or disruption,” Pryor said.

Priority Shift, Effect

The EEOC is more comfortable with disparate treatment cases because disparate impact suits use a lot of resources and tend to involve litigating multiple issues, former EEOC Chair Jenny R. Yang said.

But the agency traditionally has also used the disparate impact theory during pre-litigation investigations and bias charges are often resolved before anyone sues, said Yang, who is now with Outten & Golden LLP.

It’s hard to say how many EEOC disparate impact cases there are because of the absolute bar on disclosure at the investigative stage, said Frank C. Morris Jr. of Epstein Becker & Green PC. The agency may start out probing alleged disparate treatment and broaden its inquiry into disparate impact, he said.

Those investigations could also get pulled back, Pryor said.

Disparate impact theory has long been used to remove artificial barriers to employment, Yang said. The executive order “is deeply problematic and flawed” because it will harm workers, added the former EEOC leader under President Barack Obama and Office of Federal Contract Compliance Programs director under President Joe Biden.

The order is another way of articulating EEOC enforcement priorities, Gibson, Dunn & Crutcher LLP’s Jason C. Schwartz said. The agency brought significant disparate impact cases in pursuit of prior administrations’ policy priorities. In that sense, this will be a big shift, he said.

But deciding to stop devoting resources to a specific enforcement type “strikes me as a pretty usual administrative change,” Schwartz said. It’s a policy choice and isn’t way out from the kind of thing seen historically, he said. What’s different is that the order doesn’t say fewer cases, it seems to say none at all, Schwartz said.

Arrow for Employers

Trump’s order directs the EEOC to review its “existing” consent decrees with employers. These settlements typically include injunctive relief such as policy reforms and training, usually with years of agency monitoring.

The executive order adds arrows to the quivers of employers defending against EEOC suits, Littler Mendelson PC’s Alyesha Asghar said. Employers subject to ongoing consent decrees may want to ensure the EEOC looks into the agreements, she said.

The commission must convince the judge overseeing a case to drop any remaining anti-bias monitoring or similar provisions, Epstein Becker’s Morris said. “We’ll have to wait and see how that plays out,” he said.

Seeking to dismiss uncompleted consent decrees creates more legal risk than dropping pending suits, former EEOC chair Yang said. Decrees don’t implicate enforcement discretion and there’s no legal basis to change them, she said. She’s also concerned the order may prompt employers to raise the same arguments themselves.

Carefully analyzing the potential effects of existing or planned job practices can still be a useful tool for employers, including because of the risks of private disparate impact suits, Morris said. But a protected-class status can’t be the basis for decision-making, he said.

Private Legal Options

Workers who believe they’ve experienced disparate impact bias can still turn to the private plaintiffs’ bar and intervene in EEOC cases or sue on their own.

However, people typically bring disparate impact suits for groups of workers and private litigants face class certification requirements that the EEOC doesn’t, and arbitration agreements workers may have signed wouldn’t bind the commission, Yang said.

Private litigants also lack the agency’s “broad investigative powers,” Erlich Law founder Joshua Erlich said. The EEOC can uncover “vastly more information” before suing, while private litigants must wait for discovery, he added.

Trump earlier required the EEOC to back out of several ongoing bias cases for transgender workers. The workers in some cases intervened and attorneys outside the government have already helped their claims move forward.

When the EEOC sues, it does so as a party, not as counsel for any worker. It has “broader discretion” to drop a lawsuit and doesn’t have all of the same ethical considerations as private attorneys, who need court permission to withdraw from representing individual employees, Erlich, who primarily represents workers, said.

There’s “rarely a dearth of plaintiffs’ attorneys looking for the next big gig,” so it’s likely we’ll also see them “taking up the mantle” to file new disparate impact cases that the agency doesn’t initiate because of the order, Jackson Lewis’s Pryor said.

The EEOC “really only brings good cases” so private litigators are willing to take on those suits, but they’re “never going to be able to pick up the slack for the whole government,” Erlich said.