In a recent memorandum for all federal agencies, the Department of Justice (“DOJ”) has issued new guidance regarding unlawful discrimination. This new guidance has potentially far-reaching implications for businesses and nonprofits of all types.
Specifically, the memorandum (“the Memo”), issued by Attorney General Pamela Bondi on July 29, is aimed at entities receiving federal funds, warning that the federal government will no longer “stand by while recipients of federal funds engage in discrimination” with a reminder that such entities must ensure their programs and activities comply with federal law. In addition, the Memo identifies non-binding “best practices” as suggestions to help entities comply with the law and “avoid legal pitfalls.”
The Memo follows DOJ’s May 19 announcement of its new Civil Rights Fraud Initiative and makes clear that organizations of all types that receive federal funds or are otherwise subject to federal anti-discrimination laws—including government contractors, state and local governments, grant recipients, educational institutions and other public and private sector employers—should understand and be mindful of this new guidance going forward.
What Practices Does the Memo Identify As Potentially Unlawful?
The Memo provides much-awaited detail about exactly how the Trump administration interprets longstanding federal antidiscrimination laws as they apply to the consideration of race, sex, national origin, religion and other federally protected characteristics by employers, educational institutions and other covered entities as well as such entities’ support of third-party programs that are discriminatory. Specifically, the Memo addresses the following topics:
- Preferential treatment of protected characteristics. The Memo makes clear that DOJ considers the granting of preferential treatment based on protected characteristics to be unlawful discrimination. The Memo points to race-based scholarships and programs, preferential hiring or promotion practices, preferences in contracting, and access to facilities or resources based on race or ethnicity as unlawful practices. Specific examples of unlawful preferences cited in the Memo include so-called “diverse slate” hiring policies, sex-based criteria for awarding contracts and quotas for program participation, such as a requirement that 50% of selectees for a program be from a certain underrepresented group.
- Segregation based on protected characteristics. The Memo defines unlawful segregation as the organization of programs, activities or resources in such a way as to separate or restrict based on protected characteristics. For example, race or sex-based training sessions, employee or student affinity groups or “safe spaces” (not including intimate facilities like restrooms or locker rooms), may constitute unlawful segregation.(On a related note, the Memo describes the failure of an entity to provide sex-separated intimate spaces and athletic competitions as “typically unlawful.”) The Memo also notes that “implicit segregation” may be found where eligibility for a particular program, such as a DEI workshop, would be unlawful.
- Use of proxies for protected characteristics. Moreover, the Memo further clarifies that ostensibly neutral criteria that effectively function as substitutes for race, sex or other protected characteristics can be legally problematic as potential “proxies” for such characteristics. The Memo cites several potentially illegal proxies including “cultural competence” requirements for job applicants, geographic or institutional targeting in the context of recruiting efforts (which could apply, for instance, to recruiting efforts at Historically Black Colleges and Universities, or HBCUs), and application questions that solicit “diversity statements” or information about “overcoming obstacles.”
- Training programs that promote discrimination or hostile environments. The Memo emphasizes that an organization’s training program can violate the law if it stereotypes, excludes or disadvantages individuals based on protected characteristics or creates a hostile environment. Examples cited in the Memo include DEI training that includes statements stereotyping groups or the use of training materials or methods that single out, demean or stereotype individuals based on protected characteristics—like asserting that “all white people are privileged” or using the term “toxic masculinity,” which may single out particular groups as “inherently racist or sexist.” If such training fosters a hostile environment or penalizes individuals for expressing disagreement, they may result in discriminatory treatment in violation of federal law.
DOJ’s Recommended Best Practices
The Memo further identifies a list of “best practices” as “non-binding” suggestions to help entities comply with federal antidiscrimination laws and avoid legal pitfalls. The Memo very clearly states that these “are not mandatory requirements but rather practical recommendations to minimize the risk of violations.” These include:
- Ensure inclusive access to all workplace programs, activities and resources;
- Focus on specific, measurable skills and qualifications directly related to the job or program;
- Prohibit demographic-driven criteria aimed at achieving a specific outcome;
- Document the legitimate reason(s) for using criteria that might correlate with protected characteristics;
- Scrutinize neutral criteria for proxy effects;
- Eliminate diversity quotas in favor of purely merit-based criteria;
- Avoid exclusionary training programs that segregate participants based on protected characteristics;
- Include nondiscrimination clauses in contracts with third parties and monitor compliance; and
- Establish clear anti-retaliation procedures and reporting mechanisms.
The Memo concludes by recommending that all recipients of federal funding engage in a process to “review all programs, policies, and partnerships to ensure compliance with federal law” and to “discontinue any practices that discriminate on the basis of a protected status.”
Key Takeaways
Any entity subject to the federal antidiscrimination laws (i.e. most public and private sector employers, and especially any entity that receives or hopes to receive federal funding of any type) should understand the details of this new guidance.
While the Memo does not reflect a change in the underlying antidiscrimination laws themselves, it certainly reflects a change in enforcement priorities. And although the recommendations are not “mandatory,” per the Memo, the guidance will surely inform DOJ’s evaluation of potential enforcement actions in response to a complaint of unlawful practices. Similarly, plaintiff-side attorneys will undoubtedly utilize the guidance in pursuing discrimination claims. Entities are well advised to consult legal counsel for assistance in reviewing their relevant policies, procedures and practices for compliance with the law as outlined in this new guidance.
