Thursday, March 20, 2025

THE DIE HAS BEEN CAST ON DEI: EEOC & DOJ Issue new Technical Assistance Documents Targeting “DEI-Related” Discrimination

By Lauren M. Drabic and Dylan C. Brown*

Backlash against Diversity, Equity, and Inclusion (DEI) programs has risen in recent years. The Trump administration has made restricting DEI a clear priority, issuing multiple Executive Orders and memoranda targeting DEI programs in the federal government and striving to limit DEI in the private sector. Yesterday, the Equal Employment Opportunity Commission (EEOC) and Department of Justice also weighed in on DEI, issuing two joint technical assistance documents aimed at educating employees and employers about unlawful discrimination related to DEI in the workplace.

The first document (available here), entitled “What to Do if You Experience Discrimination Related to DEI at Work,” is a one-page overview. It states, “DEI policies, programs, or practices may be unlawful if they involve an employer or other covered entity taking an employment action motivated—in whole or in part—by an employee’s race, sex, or another protected characteristic.” The document advises that DEI initiatives may lead to unlawful disparate treatment if an employer takes “an employment action motivated (in whole or in part) by” an individual’s protected class, including as to: “hiring, firing, promotion, demotion, compensation, fringe benefits, exclusion form training, exclusion from mentoring or sponsorship programs, exclusion from fellowships, [and] selection for interviews (including placement on candidate slates).” The guidance also advises that employers are prohibited from “limiting, segregating, and classifying" employees based on protected characteristics “in a way that affects their status or deprives them of employment opportunities,” and that, “[d]epending on the facts, DEI training may give rise to a colorable hostile work environment claim.” It emphasizes that “Title VII’s protections apply equally to all racial, ethnic, and national origin groups, as well as both sexes,” and urges affected employees to promptly contact the EEOC due to “strict time limits for filing a charge.”

The second document (available here), entitled “What You Should Know About DEI-Related Discrimination at Work,” is structured as a detailed question-and-answer guide that provides clarity on how DEI programs and initiatives might conflict with Title VII. Here, the EEOC states its position that there is “no such thing as ‘reverse ’discrimination,” and advises that the EEOC will apply “the same standard of proof” to all claims regardless of an individual’s race or other protected status. It further states that employers cannot defend discriminatory practices by citing business interests in diversity or client preferences, as Title VII explicitly rejects a “business necessity” defense to intentional discrimination. Additionally, it states that employers may violate Title VII by segregating employees during DEI training or restricting workplace opportunities based on protected traits. These ideas extend beyond employees to cover applicants, interns, apprentices, and participants in training programs.

Notably, these guidance documents do not create new laws. Rather, they serve as guidance about rights as they relate to DEI based on the current state of the law under Title VII, EEOC regulations, and Supreme Court precedent.

Does This Mean DEI Programs Are Now Illegal?


The short answer is no. As long as an employer’s DEI program complies with Title VII and other federal and state laws prohibiting discrimination, it remains lawful. As was the case before the issuance of these assistance documents and President Trump’s Executive Orders, employers cannot discriminate against applicants or employees based on their race, sex, national origin, age, disability, or other protected class – regardless of whether the employees are in the majority or minority of their protected class. This means that any DEI program or policy that has the purpose or effect of giving preferential treatment to employees in hiring, training, or other employment decisions is unlawful under Title VII. For example, DEI programs that require employers to meet certain hiring quotas or to consider an employee’s race, sex, or other membership in a protected class in employment decisions is unlawful. However, DEI policies that simply aim to expand opportunities to create a more diverse workforce, implement policies and procedures that apply equitably to all employees, and foster an environment of inclusion do not violate the law.

What Should Employers Do Now?


Many employers remain committed to DEI as part of their core values. Maintaining a DEI program may open employers to potential exposure for claims of discrimination by employees/applicants if they believe the policy resulted in adverse employment practices against them. However, such programs are not inherently unlawful, and there are steps that employers who wish to maintain these programs can take to decrease legal risk. For example, employers should ensure that their DEI programs do not have the purpose or effect of giving preferential treatment to candidates or employees who are members of acertain protected class when it comes to making employment decisions. Employers should also be mindful about focusing on all aspects of DEI, including emphasizing the importance of “equity” and “inclusion” in addition to “diversity.” As it relates to diversity, rather than aiming for diversity in and of itself as an end result, employers should focus on removing barriers and increasing opportunities for diverse candidates. In addition, employers should ensure any training, educational programming, resource groups, and other DEI-related activities are inclusive and not restricted to members of a certain group.

Zashin & Rich will continue monitoring DEI developments and can assist employers with strategic guidance on moving forward with DEI questions or concerns.

*Lauren M. Drabic has years of experience representing employers in all areas of employment and labor law. She regularly defends employers against claims of discrimination and retaliation in federal and state court and before administrative agencies and advise employers, including on DEI policies. Dylan C. Brown represents public and private employers in all facets of labor and employment law. For assistance in navigating the evolving landscape surrounding DEI programs, compliance with Title VII, and anti-discrimination laws at both the federal and state levels, contact Lauren M. Drabic (lmd@zrlaw.com) or Dylan C. Brown (dcb@zrlaw.com) via email or by phone at 216.696.4441.

Monday, March 17, 2025

A Change of Course? FTC Requests Abeyance in Non-Compete Rule Appeals

By Ami J. Patel and Stephen S. Zashin*

As mentioned in our previous Alerts, the Federal Trade Commission issued a purported Rule banning employers from enforcing non-competes against “workers,” with limited exceptions. The Rule was set to go into effect on September 4, 2024. However, it faced immediate legal challenges. On August 14, 2024, the U.S. District Court for the Middle District of Florida granted a preliminary injunction blocking enforcement against a single employer. Shortly after, on August 20, 2024, the U.S. District Court for the Northern District of Texas set aside the Rule nationwide, holding that the FTC lacked statutory authority. The FTC appealed both rulings.

The FTC Rule’s next major legal challenge is coming from within the FTC itself. On January 20, 2025, President Trump appointed Andrew Ferguson as the new FTC Chairman. Ferguson, who previously voted against the Rule while serving as a commissioner, has consistently questioned the agency’s authority to implement such a sweeping restriction. Words have now become action, as on March 7, 2025, the FTC requested a 120-day abeyance in the Fifth and Eleventh Circuits to “reconsider its defense of the challenged rule.” And while the Eleventh Circuit has yet to act, on March 12, the Fifth Circuit granted the FTC’s motion.

The abeyance motions cite the change in administration and Ferguson’s view that “the Commission . . . basically needs to decide whether it’s a good idea [and] it’s in the public interest to continue defending this rule. . . . I’m going to be presenting at some point” to “my colleagues the decision about whether to continue defending this Rule.” The likely outcome of Ferguson’s decision is perhaps foreshadowed in his dissenting statement when the Rule was first adopted:
“Whatever the Final Rule’s wisdom as a matter of public policy, it is unlawful. Congress has not authorized us to issue it. The Constitution forbids it. And it violates the basic requirements of the Administrative Procedure Act.”
Although many anticipate the FTC will eventually retract the rule outright, employers should remain vigilant, as the legal landscape surrounding non-competes continues to evolve at the state-level. States such as California, North Dakota, Oklahoma, and Minnesota have enacted bans on non-compete agreements. In New York, a proposed ban was vetoed by Governor Kathy Hochul in December 2023, though revised legislation may be introduced in the future. Similarly, Ohio is considering a bipartisan bill, Senate Bill 11, introduced on January 22, 2025, aiming to prohibit employers from entering into non-compete agreements with workers. As legal uncertainty persists, employers should take the time now to review their restrictive covenants for compliance with state laws and ensure their agreements are narrowly tailored to protect their legitimate business interests.

Zashin & Rich will continue monitoring the FTC’s actions under this new administration and stands ready to assist employers with strategic guidance on the agency’s rule and evolving state-level non-compete laws.

*Ami J. Patel is Z&R’s Practice Leader for Trade Secrets/Non-competes. She works extensively in trade secret and restrictive covenant litigation. Stephen S. Zashin is Z&R’s Managing Partner and also has worked extensively representing clients in trade secret and restrictive covenant litigation. For more information on matters concerning the FTC Rule or non-compete agreements generally, contact Ami J. Patel (ajp@zrlaw.com) or Stephen S. Zashin (ssz@zrlaw.com) via email or by phone at 216.696.4441.