Added 4/24/2025
Executive Order (EO), Restoring Equality of Opportunity and Meritocracy, issued by the Trump Administration, directs federal agencies to eliminate the use of disparate-impact liability to the greatest extent possible. This signals a significant shift in how civil rights laws may be enforced at the federal level.
For background, disparate-impact liability says that if these differences in results are significant, then the law might assume that the rule or practice is actually discriminatory, even if no one intended to discriminate, and even if everyone had the same chance to succeed under the rule.
Key Takeaways
- The EO frames disparate-impact liability, where a neutral policy results in unequal outcomes among protected groups, as unconstitutional and inconsistent with the principle of equal opportunity.
- Federal agencies, including the EEOC and DOJ, are directed to deprioritize enforcement actions based on disparate impact and to begin reviewing existing regulations, investigations, and settlements for potential rollback.
- Employers may feel less pressure from federal agencies to modify neutral policies that produce different outcomes across protected classes, particularly where no intent to discriminate is present.
State Law Still Applies
This EO does not impact the state’s civil rights laws. Many states, including California, New York, and Illinois, continue to recognize disparate-impact claims, and enforcement at the state level remains unchanged. Employers operating across multiple jurisdictions will need to continue evaluating practices under both federal and state standards.
Why Continued Monitoring for Disparate Impact Still Matters
Despite the EO, it is recommended that employers continue to monitor for potential disparate impact. The U.S. Supreme Court first recognized disparate impact as a valid theory of discrimination in the Griggs v. Duke Power Company. This principle was later codified when Congress passed the Civil Rights Act of 1991, which formally incorporated disparate impact provisions into Title VII of the Civil Rights Act (Title VII). As a result, the absence of federal agency enforcement does not preclude private individuals from bringing disparate impact claims under Title VII that may ultimately be decided in federal court. Additionally, many states allow such claims under their anti-discrimination laws. Proactive review helps mitigate legal and reputational risk while supporting equal employment opportunity objectives. Furthermore, proactively identifying and addressing disparities remains a sound compliance practice regardless of intent. It helps ensure policies are job-related and consistently applied, reducing the likelihood of legal or employee relations issues.
Anticipated Legal Challenges
This order is likely to face legal challenges from civil rights organizations and state attorneys general, particularly due to its conflict with established interpretations of Title VII and other federal statutes. Additional concerns may include executive overreach, procedural violations, and equal protection arguments.