In the year since President Donald Trump issued a series of executive orders targeting diversity, equity, and inclusion efforts, the federal government’s approach has evolved from initial guidance to active investigations and other legal challenges to workplace DEI programs. Recent actions by the Equal Employment Opportunity Commission, Department of Justice, and Federal Trade Commission signal that DEI programs must be carefully reviewed to avoid unlawful discrimination, even when well-intentioned. Employers that fail to adapt may face investigations, litigation, or reputational harm. For human resources leaders, this raises a pressing question: How can organizations maintain inclusive workplaces while staying compliant and avoiding increasing enforcement activity?
A Rapid Evolution from Guidance to Enforcement
Scrutiny of DEI programs began almost immediately after Trump took office and issued executive orders that rolled back affirmative action programs and targeted undefined “illegal DEI” efforts by the federal government and in contracting.
Soon after, the EEOC and DOJ issued joint guidance on DEI-related discrimination, including the EEOC’s “What You Should Know About DEI-Related Discrimination at Work” and a companion document for workers, “What To Do If You Experience Discrimination Related to DEI at Work.” The guidance emphasizes that:
- Identity-restricted internships, leadership programs, and employer-sponsored events may constitute discrimination if they exclude or disadvantage employees based on protected traits, including those not historically the focus of DEI efforts.
- “Diverse slate” or numerical representation practices are permissible only if they do not result in decisions based on protected characteristics.
- DEI training, affinity groups, and similar programs can create risk if they segregate employees, rely on stereotypes, or contribute to a hostile work environment.
In response, many employers revised program language and emphasized neutral criteria for hiring and promotion opportunities. By late 2025, however, the EEOC had taken a more assertive enforcement posture. EEOC Chair Andrea Lucas explicitly stated that the agency would “attack” all forms of workplace racial discrimination, including those arising from DEI programs, and warned that diversity initiatives may be unlawful if they favor or disadvantage employees based on protected characteristics, regardless of intent or labeling. The EEOC also reinforced in updated national origin guidance that discrimination can include favoring foreign workers over U.S. employees (and vice versa) and that business justifications such as cost or customer preference do not excuse such practices.
Enforcement Actions Targeting Corporate DEI Programs
In early 2026, the EEOC and DOJ began operationalizing this framework.
- Nike investigation: On February 4, the EEOC brought a subpoena enforcement action seeking information on Nike’s DEI-related hiring and promotion policies.
- Coca-Cola Beverages Northeast lawsuit: On February 17, the EEOC sued Coca-Cola Beverages Northeast LLC under Title VII, alleging sex discrimination over a women-only employer-sponsored networking trip. The agency contends that excluding male employees from the event was unlawful, with Lucas criticizing similar programs as exclusionary “new girls clubs” comparable to historical “old boys clubs” and “whites only” clubs.
- Fortune 500 warning letter: On February 26, Lucas issued a “Reminder of Title VII Obligations Related to DEI Initiatives” to 500 of the largest U.S. companies, reiterating that employment decisions must not be based on protected characteristics and warning of full enforcement tools, including litigation.
- Planned Parenthood of Illinois settlement: On March 19, the EEOC announced a $500,000 settlement resolving allegations that Planned Parenthood of Illinois used race-based “affinity caucuses” and mandatory DEI training containing derogatory statements about white employees, potentially violating Title VII.
- IBM settlement: On April 10, the DOJ announced a $17 million settlement with IBM after alleging that it violated the False Claims Act by failing to comply with anti-discrimination requirements in its federal contracts. The alleged illegal discrimination included use of “diverse interview slates;” race and sex demographic goals for business units; and limiting certain training, partnerships, mentoring and leadership development programs and educational opportunities only to certain employees based on race or sex.
Through these actions, the federal government is clearly signaling to employers that DEI programs may be challenged if they restrict opportunities based on protected characteristics or embed identity-based criteria into training or advancement. As enforcement expands, organizations should expect continued scrutiny of the substance and impact of workplace DEI programs, not just their intent or rebranding.
Unexpected Antitrust Risks Emerge in DEI Collaboration
While the EEOC and DOJ have focused on discrimination, the FTC has introduced a novel angle: antitrust exposure from DEI collaboration. In early 2026, the FTC issued warning letters to 42 law firms, stating that participation in third-party diversity “certification” programs may violate the Sherman Antitrust Act of 1890, which prohibits collusion to fix pricing and market conditions and the establishment of monopolies.
The FTC raised concerns that sharing diversity benchmarks (e.g., a collective goal of ensuring that at least 30% of a given talent pool comes from underrepresented racial or other groups) and cross-company discussions of workforce representation and hiring targets could reduce independent decision-making and distort competition for talent. Even voluntary alignment around common DEI targets may raise issues if it standardizes employment practices across competitors.
Although no enforcement actions have been filed, the FTC’s position signals that employers should evaluate DEI collaborations not only with respect to compliance with applicable employment laws but also through an antitrust lens. Industrywide pledges, benchmarking, or coordinated workforce initiatives may warrant closer review to avoid the appearance of collusion.
Federal Contractors Also Face Expanding Compliance Obligations
DEI-related compliance obligations are also expanding through federal contracting rules. On March 26, Trump signed Executive Order 14398, “Addressing DEI Discrimination by Federal Contractors.” Unlike earlier guidance that left “illegal DEI” undefined, this order targets practices by using more specific terminology.
Specifically, EO 14398 requires federal contracts to include a certification provision that contractors will not engage in any “racially discriminatory DEI activities,” which the order defines as disparate treatment based on race or ethnicity in hiring, promotion, contracting, resource allocation, or program participation. In turn, “program participation” includes access to training, mentoring, leadership programs, educational opportunities, clubs, and associations.
The executive order also imposes reporting and disclosure requirements and subcontractor flow-down obligations and reinforces potential False Claims Act liability for noncompliance. Federal contractors should expect agencies to soon incorporate these requirements into the contracting process, with limited flexibility. Accordingly, federal contractors and grant recipients should immediately review their DEI policies and programs to evaluate any impacts given the definition of “racially discriminatory DEI activities” set forth in the executive order.
Practical Compliance Steps for Employers
Although DEI programs face unprecedented scrutiny, they are not prohibited outright. With the federal government having more clearly defined its views regarding the interaction between federal law and DEI initiatives, HR leaders should consider the following steps:
- Conduct a comprehensive DEI audit, under attorney-client privilege, and refine existing programs.
- Emphasize expanding opportunities rather than restricting access, using neutral criteria and prioritizing outreach over selection preferences.
- Avoid coordinated DEI practices across organizations, particularly in hiring and compensation.
- Update training for HR teams and leadership.
- For federal contractors, review certification language carefully and ensure consistency between internal practices and external representations.
- Maintain documentation showing that employment decisions are based on legitimate, nondiscriminatory factors.
- Monitor ongoing legal and regulatory developments.
By taking these steps, employers can continue supporting inclusive workplaces while minimizing legal exposure.
Ashley Kelly is a partner at Arnall Golden Gregory and co-chair of the firm’s employment practice group. She serves as lead counsel in a full range of employment and business disputes, including claims involving allegations of discrimination and harassment, violations of employee leave laws, wage-and-hour issues, breach of executive employment contracts, benefits disputes, and other complex business litigation matters. She also negotiates executive compensation packages and advises on matters relating to unfair competition and restrictive covenants. She can be reached at ashley.kelly@agg.com.
Megan Mitchell is a partner at Arnall Golden Gregory and co-chair of the firm’s Litigation & Dispute Resolution practice. She represents employers in claims made under state and federal employment laws and routinely counsels clients through various employment issues and disputes, with significant experience handling internal investigations, discrimination claims, wage-and-hour issues, and post-employment competition disputes. She can be reached at megan.mitchell@agg.com.
Sydney Selman is an employment litigation associate at Arnall Golden Gregory. She can be reached at sydney.selman@agg.com