Are DEI Programs Legal? When Do They Cross the Line?

Diversity, Equity, and Inclusion (DEI) programs are employer-led initiatives that focus on increasing representation, improving access to opportunities, and addressing workplace barriers tied to race, sex, and other protected characteristics. Common DEI strategies include targeted recruitment, structured mentorship, bias training, and support for voluntary employee resource groups.

When structured correctly, DEI programs are lawful, but when race, sex, or similar traits influence decisions about hiring, promotion, or access to training and advancement, employers expose themselves to legal risks.

To comply with current federal and state laws, DEI programs have to be carefully designed to promote inclusion without giving preference or imposing limits based on protected traits.

What Federal Law Allows and Prohibits in DEI Programs

Federal civil rights laws prohibit employers from making hiring, promotion, training, or compensation decisions based on race, sex, or other protected characteristics. DEI policies that influence employment decisions based on protected traits may be unlawful, regardless of the employer’s intent.

The Equal Employment Opportunity Commission (EEOC) enforces federal laws that prohibit workplace discrimination. The Department of Justice (DOJ) may also take enforcement action, particularly in cases involving public employers or claims brought under Section 1981.

Key Federal Laws Governing Employment Decisions

Title VII of the Civil Rights Act of 1964 prohibits employment discrimination based on race, color, religion, sex, or national origin. Title VII applies to hiring, termination, promotions, pay, and access to benefits and training.
Section 1981 of the Civil Rights Act of 1866 prohibits racial discrimination in contractual relationships, including employment agreements. Section 1981 allows employees to file lawsuits directly in court without going through the EEOC.

DEI Program Features That May Trigger Liability Under Federal Law

EEOC and DOJ guidance released in March 2025 confirms that employment decisions cannot be motivated by an employee or prospective employee’s protected traits—even as part of a diversity initiative.
Hiring preferences, exclusive fellowships, or race- or gender-specific internships may violate federal law if participation is limited to those with protected characteristics.
Limiting access to mentorship, leadership development programs, training programs, or networking events based on race, sex, or similar traits may constitute unlawful segregation or classification under Title VII.

Federal law allows employers to pursue inclusive goals, but employment decisions still need to be based on job-related criteria—not on protected traits.

Diverging State Approaches That Shape DEI Policy

States have taken very different positions on DEI programs. Some have passed laws restricting or eliminating them, while others have moved to protect or expand them. Employers who operate in more than one state face inconsistent requirements and increased compliance risk as a result of these differences.

States Restricting DEI Programs

Several states have passed legislation or issued executive orders to limit or prohibit DEI initiatives in public institutions and, in some cases, private organizations.

Florida: Senate Bill 266, effective July 1, 2023, prohibits public universities from funding DEI programs and restricts courses that include certain concepts related to race and gender.
North Carolina: Senate Bill 558, enacted in 2025, proposes eliminating DEI offices and staff at public universities, restricts spending on DEI programming, and bars schools from requiring diversity statements in hiring.
West Virginia: Legislation passed in March 2025 prohibits state entities from establishing DEI offices, hiring DEI personnel, and mandating DEI training.

South Carolina: Bill 3927, known as the "Ending Illegal Discrimination and Restoring Merit-Based Opportunity Act," prohibits state offices and institutions from promoting DEI initiatives.

States Supporting DEI Initiatives

Other states have issued public guidance affirming that DEI programs can be lawful when implemented within the parameters of civil rights laws.

Connecticut

State officials issued guidance encouraging businesses to maintain workplace policies that prevent discrimination and promote compliance with civil rights laws. The guidance emphasizes that DEI programs remain lawful when they do not involve employment decisions based on protected traits.

New York

A state-issued bulletin advised educational institutions that DEI policies can be consistent with civil rights laws when they focus on inclusion and access rather than preference or exclusion based on protected characteristics.

Massachusetts and Other States

A coalition of states released guidance confirming that DEI policies can comply with state and federal law when they are structured to avoid decisions based on protected traits.

Employers with offices in multiple states may not be able to use the same DEI program everywhere. Some states prohibit diversity statements in hiring, restrict public funding for DEI initiatives, or ban training content related to race or sex. Employers should review applicable state laws and adjust their policies to avoid conflicts with local restrictions.

Where DEI Programs Face Legal Risks Today

Some DEI programs expose employers to legal risks because of how they affect employment decisions. The points below highlight specific practices that have drawn legal complaints, agency inquiries, or public challenges.

How DEI Programs Can Trigger Discrimination Claims

Using demographic goals in hiring or advancement decisions: Stating a goal to increase representation of a specific race or sex, and using that goal to influence who gets hired, promoted, or selected for a program, can violate federal anti-discrimination laws—even if the goal is not formally written into policy.

Tiebreaker decisions based on protected traits: Choosing one candidate over another based on race or sex, even when qualifications are equal, violates federal law.

Restricting access to programs: Limiting eligibility for internships, fellowships, or training to certain demographic groups may be treated as exclusionary under anti-discrimination statutes.

Evaluating applicants based on DEI alignment: Requiring applicants to express personal beliefs about DEI can result in claims if the prompt favors specific viewpoints or impacts hiring outcomes.

Using demographic characteristics in mentorship assignments: Assigning mentors or access to leadership opportunities based on race or gender can expose employers to legal risk, even if the program is voluntary.

How DEI Practices Can Violate Segregation and Classification Laws

Restricting participation in employee groups: Limiting access to resource groups, including those intended to build peer support or promote professional development, based on race, sex, or other protected characteristics may be considered segregation under Title VII.
Organizing race- or gender-specific events: Hosting training sessions, networking opportunities, or retreats that exclude employees based on protected traits can trigger discrimination claims.
Assigning roles based on demographics: Steering employees toward specific tasks, teams, or projects because of their race or sex may violate anti-discrimination laws, even if done with inclusive goals in mind.
Separating training or programming by group identity: Dividing employees into race- or gender-based groups during DEI activities may be seen as unlawful classification if participation or messaging differs between groups.

How to Structure Lawful Employment DEI Initiatives

Employers can promote inclusion while staying within the limits of federal anti-discrimination law by focusing on opportunity, transparency, and job-related criteria. The EEOC and DOJ have made clear that programs labeled as DEI are subject to the same legal standards as all other workplace policies. Programs that benefit all employees and do not rely on protected traits in decision-making are less likely to trigger legal risk.

Keep Participation Open

Resource groups, leadership programs, and training opportunities should be open to all employees, regardless of race, sex, or other protected traits.
If a program supports a specific community, participation still cannot be limited based on identity. Title VII prohibits employers from excluding employees from workplace benefits based on protected characteristics.
Voluntary groups that are structured around shared interests—not identity-based eligibility—reduce legal exposure.

Use Neutral Selection Criteria

Hiring, promotion, and access to development programs should be based on qualifications, experience, and job performance.
Avoid using demographic goals to select candidates or participants. Even informal tiebreaker decisions based on race or sex can lead to claims under Title VII or Section 1981.
Written policies should clearly describe how participants are selected and should not reference race, sex, or related criteria.

Review Language and Messaging

Terms like “underrepresented” or “diverse candidate” can create confusion if they appear to reference specific traits tied to employment decisions.
Internal documents, job postings, and training materials should avoid suggesting that identity alone is a factor in advancement or selection.
DEI statements should focus on values like equal opportunity, fairness, and inclusion—not outcomes based on demographics.

Key Takeaways for Employers Focused on DEI in 2025

Employers do not need to abandon DEI programs, but they do need to revise them carefully to align with federal and state law. Federal enforcement agencies have stated that DEI policies are subject to the same anti-discrimination laws as any other workplace practice, regardless of how the program is labeled. Employers face exposure under Title VII and Section 1981 when race, sex, or other protected traits influence decisions about hiring, promotion, or access to programs. Organizations that want to continue offering inclusive initiatives while complying with these laws should focus on access, transparency, and consistent, neutral criteria.

Audit how DEI language is used in hiring materials, leadership messaging, and internal documents. Language that implies race or sex is tied to advancement or eligibility can increase legal exposure.
Standardize how employees are selected for leadership development, mentorships, or public-facing roles. Selection processes that rely on informal discretion may allow protected traits to influence outcomes.
Treat DEI programs the same way you would any other employment-related policy: with written procedures, documented selection criteria, and periodic legal review.
Avoid linking DEI performance metrics to decisions about manager compensation, promotions, or performance evaluations unless those metrics are neutral and job-related.
Track how DEI initiatives are experienced across different teams or offices. A program may appear neutral on paper but create unequal access in practice.

How Conn Maciel Carey Can Help

DEI programs are now subject to closer legal scrutiny at both the federal and state level than ever before. Agencies like the EEOC and DOJ have issued recent guidance warning that employment decisions based on race, sex, or other protected traits may violate anti-discrimination laws—even when made in the name of inclusion. Several states have also enacted laws that limit or restrict how DEI initiatives can be implemented. As a result, employers with DEI policies that influence hiring, promotions, or access to workplace opportunities now face a higher risk of litigation, audits, and enforcement action.

Conn Maciel Carey advises employers on how to build inclusive programs that comply with Title VII, Section 1981, and applicable state laws. We review existing DEI policies, evaluate language and eligibility standards, and help employers make adjustments that align with both business goals and current legal limits. Whether you’re updating your hiring materials, revising training programs, or reviewing internal guidance, we can help you identify risk and make targeted changes that reduce liability.

To learn more or speak with an attorney about your organization’s DEI policies, contact Conn Maciel Carey’s national Labor & Employment Practice Group by calling (202) 715-6244 or sending an email.

This article is for informational purposes only and does not constitute legal advice. While we strive to ensure accuracy, laws and regulations may change, and unintended errors may occur. This content may not address every aspect of the relevant legal requirements. For guidance on your specific situation, consult your attorney.