Executive Order 14281 – Disparate Impact Discrimination Claims and Enforcement Directly Under Fire
Executive Order 14281 – Disparate Impact Discrimination Claims and Enforcement Directly Under Fire
Rob Thomas, Of Counsel
The first few months of President Trump’s second presidential term have been characterized by an unprecedented number of Executive Orders—many of which have been directed towards curbing or prohibiting both public and private diversity, equity, and inclusion (“DEI”) initiatives in the workplace.[1] On April 23, 2025, the President issued Executive Order 14281—entitled “Restoring Equality of Opportunity and Meritocracy”—which goes even further and seeks to curtail or eliminate the use or application of disparate impact liability among federal agencies charged with investigating or preventing prohibited discrimination, including the Equal Employment Opportunity Commission (“EEOC”).
Disparate Impact Liability – An Overview
In 1991, Congress codified the requirements of disparate impact discrimination claims under Title VII of the Civil Rights Act of 1964 (“Title VII”) which were previously recognized by the United States Supreme Court in Griggs v. Duke Power Co.[2] In contrast with disparate treatment discrimination claims (which require proof of an employer’s intent to discriminate on the basis of race, sex, national origin, etc.), a plaintiff may state a disparate impact claim by showing that the employer used a particular employment practice that caused a disparate, discriminatory impact on a protected class or classes. The employer must then demonstrate that the challenged practice was job related or consistent with business necessity in order to avoid liability. In other words, disparate impact claims focus on whether an otherwise facially-neutral employment practice nonetheless produces discriminatory results against a particular protected class or classes—such as a job application questionnaire used in hiring decisions that, while neutral on its face, nonetheless screens out a statistically significant percentage of minority applicants versus their majority counterparts.
Along with Title VII, disparate impact liability has also been recognized as a viable claim under the Age Discrimination in Employment Act and the Americans with Disabilities Act, among other federal statutes such as Title VI of the Civil Rights Act of 1964 (“Title VI”), which prohibits discrimination in programs and activities that receive federal financial assistance.
Executive Order 14281
In his Executive Order, President Trump characterizes disparate impact liability as a tool in a “pernicious movement” focused on ostensibly equal results among different groups of people, rather than equal opportunities, thereby requiring employers to engage in racial and other class-balancing efforts in order to avoid liability, rather than focusing on the merits of each individual applicant and the specific needs of a particular job.
In light of the above, the Executive Order mandates the following actions to be taken, among other things:
· Requiring the Attorney General to initiate appropriate action to repeal or amend Title VI regulations for all federal agencies to the extent they contemplate disparate impact liability;
· Requiring the Attorney General to provide a report to the President of all existing federal regulations, guidance, rules, or orders that impose disparate impact liability, and to detail agency steps for their amendment or repeal;
· Requiring the Attorney General and the EEOC to assess all pending investigations, civil suits, or other positions taken in ongoing matters under their purview that rely on disparate impact liability, and to take “appropriate action” with respect to such matters consistent with the Executive Order’s policy to eliminate the use of disparate impact liability in all contexts to the maximum degree possible;
· Requiring the Attorney General to assess whether any federal authorities potentially preempt state laws, regulations, policies, or practices that impose disparate-impact liability;
· Requiring all agencies to deprioritize enforcement of all statutes and regulations to the extent they include disparate impact liability, including but not limited to Title VII.
In addition, the Executive Order requires the Attorney General and the EEOC Chair to jointly formulate and issue guidance or technical assistance to employers regarding “appropriate” methods to promote equal access to employment, regardless of whether an applicant has a college education where appropriate—presumably to focus more on skills-based hiring as opposed to traditional credentials like a college degree.
Employer Considerations
The Executive Order has no effect on the statutory language of statutes like Title VII, which expressly create a cause of action for disparate impact discrimination. The Executive Order also does not currently affect any substantive rights under Colorado law, or an individual’s right to bring a private cause of action for disparate impact discrimination. But, the Executive Order certainly will affect federal agencies’ enforcement of disparate impact laws and regulations (including the EEOC’s). It is also fair to assume that the Executive Order will lead to a new wave of lawsuits challenging the same—particularly since it calls for federal agencies to abandon the application of a theory of liability expressly codified by Congress as part of Title VII, and likewise calls for federal review and scrutiny of the civil rights laws of individual states. Campbell Litigation will continue to monitor this order and other Executive Orders which directly impact Colorado employers.
[1] See, e.g. https://www.rockymountainemployersblog.com/blog/2025/1/30/the-trump-administration-brings-attack-on-illegal-dei-policies-to-the-private-sector.
[2]401 U.S. 424 (1971).