Diversity, Equity and Inclusion (DEI) has been a hot topic. In 2023, the Supreme Court issued its decision in Students for Fair Admissions (SFFA) v. Harvard, 600 U.S. 181 (2023), eliminating race as a factor for college admissions. Immediately after President Trump took office, he focused on private sector DEI, issuing Executive Order 14173, “Ending Illegal Discrimination and Restoring Merit-Based Opportunity,” which orders federal agencies to “combat illegal private-sector DEI preferences, mandates, policies, programs, and activities.” Additionally, on July 29, 2025, Attorney General Pam Bondi released a memorandum detailing how the Department of Justice will analyze DEI programs vis-à-vis federal anti-discrimination statutes.
While it may seem as though DEI is a new issue due to its prevalence at the forefront of public discourse, its origins date back decades. For example, in 1978, the United States Supreme Court’s decision in Regents of the University of California v. Bakke, 438 U.S. 265 (1978), eliminated diversity quotas. Thus, while the phrase DEI has recently come under scrutiny, there remains – as there has for decades – a role for lawful diversity, equity and inclusion in the workplace. The article provides insight for employers on how to address the changing landscape for DEI programs and initiatives in 2025 in a legally compliant fashion.
The Future for DEI in the Private Sector
Within a few months of the Supreme Court’s decision in SFFA v. Harvard, corporate diversity programs were immediately thrust into the spotlight. We even saw lawsuits filed against corporations for their DEI programs. Despite some litigation, lawful DEI will continue to have a role in private sector employment via the numerous federal and state laws protecting against workplace discrimination and harassment, including:
- Title VII, which prohibits employment discrimination based on race, color, religion, sex, and national origin.
- The Americans with Disabilities Act, prohibiting discrimination based on disability.
- The Age Discrimination in Employment Act, which prevents discrimination against older employees.
- The Uniformed Services Employment and Reemployment Rights Act, prohibiting discrimination based on military service.
The memorandum underscores the continued applicability of these federal anti-discrimination laws and the role they play in combating illegal workplace discrimination and harassment. Moreover, the memorandum provides guidance on DEI programs and how they may run afoul of these laws. While the memorandum was provided as guidance to entities receiving federal funding, many of the positions are relevant to private employers since the Trump Administration has oversight of the governmental agencies responsible for enforcing federal anti-discrimination laws.
Of particular relevance to private employers are those “policies and practices” identified by the Department of Justice as being unlawful and discriminatory, including:
- Internships, mentorship programs or leadership that “reserve spots” for specific racial (or other protected groups;
- Prioritizing candidates for employment coming from underrepresented groups;
- Providing spaces that may be accessed only by persons of a given protected category;
- Training sessions that separate participants into groups based on protected characteristics; and
- Requiring a diverse slate of candidates for a position of employment.
Employers should review their policies to avoid engaging in unlawful behavior that has been invalidated by the courts or disfavored by the current administration. Employers should expressly avoid policies that create (whether expressly or implicitly) quotas (a certain number of employees in a given protected category), set asides (holding spots/jobs for certain people), or that favor or disfavor a given group of employees.
DEI will persist in practice; however, the phrase “DEI” has become polarizing and brought businesses under state and federal government scrutiny. Employers may consider rebranding policies and initiatives to ensure these beneficial policies are not undercut by the negative opinions of DEI. While DEI has come under scrutiny, having properly implemented DEI policies is not illegal. For example, while it certainly would violate the law to hire an employee because of their race, it would not be a violation of the law to advertise for a position in a wider variety of publications, including publications that are more likely to reach a more diverse set of candidates. Employers need to ensure that their policies are not allowing employees to be hired, promoted, or favored (or the converse) because they are diverse (or not).
Employers should also consider implementing the best practices set forth in the DOJ’s memorandum, which include:
- Ensuring inclusive access for all qualified individuals regardless of their protected status;
- Focus on skills and qualifications rather than membership in a protected group;
- Document rationale for employment decisions, including the criteria relied upon when making hiring, promotion, and other decisions impacting workplace opportunities;
- Eliminating any quotas targeting persons of a given protected characteristic; and
- Maintain and train on anti-discrimination and retaliation policies.
Spilman understands that navigating this tightrope of acceptable versus illegal DEI can be confusing, particularly with the number of developments seen in the DEI space in recent months. Consider consulting legal counsel to help you audit your policies for compliance and to help develop compliant policies and processes moving forward.
