On April 23, 2025, Donald Trump issued an Executive Order titled “Restoring Equality of Opportunity and Meritocracy,” (“EO”) which will likely significantly impact the Equal Employment Opportunity Commission’s (“EEOC’s”) enforcement of disparate impact discrimination. Disparate impact discrimination occurs when a workplace policy or practice is neutral on its face but has a disproportionate impact on a protected group, such as workers of a certain age, race, or gender. The disparate impact theory of employment discrimination was first recognized by the U.S. Supreme Court in 1971 and was later codified into the Civil Rights Act in 1991.
The EO is aimed at dismantling legal claims based upon a disparate impact theory and, as a result, the EEOC will likely no longer investigate or bring cases based upon same. The EO asserts that potential disparate impact liability hinders businesses from making employment decisions, is inconsistent with the Constitution, and is contrary to equal protection under the law. This shift may have wide-ranging impacts, including relevant compliance responsibilities for employers. However, while the EO impacts the federal government, private litigants are not bound by its directives. As such, claims that do not directly involve the government will likely continue.
Further, on April 29, 2025, Federal Agencies, including the EEOC, were instructed to cease enforcement of disparate impact discrimination claims as a result of the EO. The Administration is sending a strong signal that DEI and other discrimination-centric laws may be under further attack. In the future, while employers can expect less scrutiny from the EEOC with respect to potential disparate impact claims, existing federal regulations, statutes, court decisions, and state laws provide other avenues for a private litigant to assert those claims against an employer. Therefore, employers should be aware of these changes and how they may impact workplace policies and procedures. If you have any questions related to these new changes and how they may affect your business, please reach out to the authors of this post or one of the attorneys at MHS.