EEOC Investigates Law Firms, Issues Guidance on Illegal Practices

On March 17, the U.S. Equal Employment Opportunity Commission (EEOC) launched an inquiry into 20 prominent law firms, focusing on diversity, equity, and inclusion (DEI) initiatives. That news was followed by the agency issuing guidance for all employers covered by Title VII of the Civil Rights Act of 1964 on what the EEOC considers to be unlawful practices.

Law Firm Policies Scrutinized 

Acting Chair Andrea Lucas issued formal letters to the firms, citing concerns that certain inclusion and diversity (I&D) policies may inadvertently violate Title VII, which prohibits discrimination based on race, color, religion, sex, or national origin.

The EEOC’s examination stems from suspicion that some programs within these firms may involve unlawful practices, such as restricting or categorizing employees in a manner that could limit their opportunities or affect their employment status.  

Lucas emphasized that no organization, regardless of its stature, is exempt from compliance with federal anti-discrimination laws. “No one is above the law — and certainly not the private bar,” she said.

Among the high-profile law firms receiving inquiries is the leading practice Skadden, Arps, Slate, Meagher & Flom LLP and Affiliates, as well as other top names such as Kirkland & Ellis LLP and WilmerHale. By targeting I&D practices within this influential industry, the EEOC aims to underscore the importance of aligning diversity efforts with federal anti-discrimination laws. 

The EEOC Defines “Illegal DEI”

On March 19, the EEOC and the U.S. Department of Justice released technical assistance, further clarifying their understanding of what constitutes an illegal practice. 

Any action an employer takes that is motivated by an employee’s protected characteristic, such as race or gender, may be an instance of discrimination, according to the EEOC. The commission cites suspicions of preferential treatment of certain demographics in situations such as hiring decisions, leading to a supposed reduction in opportunity for other demographics.

“Far too many employers defend certain types of race or sex preferences as good, provided they are motivated by business interests in ‘diversity, equity, or inclusion.’ But no matter an employer’s motive, there is no ‘good,’ or even acceptable, race or sex discrimination,” Lucas said. 

HR’s Path Forward

While these developments do not create new legal obligations, organizations must understand that it’s essential to comply with the law and prevent discrimination of all kinds.  

“The EEOC’s investigation into the inclusion and diversity practices of these firms represents yet another reminder for HR to prioritize legal compliance in how they approach I&D,” said Alex Alonso, Ph.D., SHRM-SCP, chief data and analytics officer at SHRM.

As HR professionals consider Title VII as it relates to building work environments that inspire inclusive and diverse cultures, they should underscore merit in hiring discussions and discover methods of balancing this with a desire to cultivate diversity.  

HR should move forward by considering skills and demonstrated abilities first in the hiring or promotion processes, rather than academic history or institutional pedigree. By developing examinations for candidates that allow them to prove their merit, as well as by giving priority to applicants with portfolio submissions and other examples of previous work, HR professionals can lower the barrier to entering the workforce for individuals who lack access to higher education. 

Furthermore, HR can value merit while also alleviating issues that prevent untapped talent from entering the workforce — widening its concept of diversity and cultivating it without basing employment decisions on protected characteristics. For example, they may consider possible bias against hiring candidates with criminal backgrounds, refraining from reducing them to their shortcomings. They may choose not to exclude candidates based on career gaps, allowing former stay-at-home parents and veterans to return to work. 

Member Resource: How to Make the Most of Hiring from Underemployed Groups

“Organizations must continue to audit their practices for potential discrimination. They must also focus on breaking down barriers to the workforce for all, leading with a ‘skills-first’ mindset and making sure not to inadvertently exclude underutilized pools of talent,” Alonso said. 

Learning to minimize such roadblocks to workforce entry allows HR professionals to separate I&D efforts from affirmative action, which is a major focus of the EEOC’s enforcement attention. By understanding that cultivating a diverse workforce doesn’t have to involve hiring preferences based on protected characteristics, organizations can comply with Title VII while addressing the root causes that contribute to a lack of diversity. 

“Upholding equity and inclusion in the workplace, based on diverse talent, is different than affirmative action,” said Andrew Botwin, New Jersey-based founder of leadership and executive consulting firm Strategy People Culture (SPC) LLC. “While the Trump administration may be after broader change, the fundamental principle of their policies is ending preferential treatment based on demographic, requiring employers to focus on merit. In other words, knowledge, skills, and abilities should be what matters around hiring, promotion, and other employment-based decisions.”

Understanding the law and communicating effectively as an organization is crucial as HR professionals move forward in an effort to value diversity in a legally compliant manner. They must know the intentions of the current administration, and any need for policy change must be understood throughout the organization. HR professionals can consult SHRM’s Belonging Enhanced by Access through Merit (BEAM) framework resources as they navigate the future of I&D. 

Member Resource: Does Your I&D Strategy Align with BEAM?

“A major miss across all organizations comes down to a lack of effective communication, and that remains as important as ever,” Botwin said. “Ensuring you are legally compliant often comes down to collaborating with people who understand the law. Issues like this are charged with opinions and emotions. Step back to ask yourself, ‘What is it we are trying to do and why? What is the EEOC trying to do and why?’ Understand the gap and go from there.”