Recent guidance from the U.S. Department of Justice (DOJ) on the use of diversity, equity, and inclusion (DEI) initiatives in both employment and other public programs signals a shift in how employers should navigate the choppy waters of federal and state antidiscrimination laws.
Shifting Ground on DEI
In recent months, businesses have seen several measures—by both the executive and judicial branches of the federal government—that affect the present and future status of DEI programs. The initiatives have included Executive Order (EO) 14151, which the White House entitled, “Ending Radical And Wasteful Government DEI Programs And Preferencing,” and a June 2025 U.S. Supreme Court decision affirming that members of majority groups (e.g., heterosexual, Caucasian, and/or male employees) are afforded protections under federal antidiscrimination law to an equal extent as minority employees.
Most recently, on July 30, 2025, the DOJ released guidance, authored by the Office of U.S. Attorney General Pam Bondi, concerning DEI initiatives in both employment and other public programs. In the guidance, the attorney general opines that DEI programs are illegal under federal antidiscrimination law, such as Title VII of the Civil Rights Act of 1964, because they show preference to minority employees based on race, color, national origin, sex, religion, or other protected characteristics.
The guidance goes on to say that characteristics that serve as a “proxy” for discrimination—such as the requirement that an applicant have “cultural competence” or “lived experience,” or that an applicant come from a certain geographic area—are viewed as equally discriminatory. The guidance further states that the use of euphemistic terms such as “DEI” and “Equity” will not “excuse unlawful discrimination or absolve parties from scrutiny regarding potential violations.” Finally, the guidance expressly notes the right of employees to be free from retaliation if they refuse to participate in DEI programs, training, or policies.
Your Shield Against Liability Could Be Turned Against You
While styled as “non-binding” “suggestions” directed solely at recipients of federal funding, the guidance also addresses private employers, noting that “Entities that receive federal financial assistance or that are otherwise subject to federal anti-discrimination laws, including . . . public and private employers, should review this guidance carefully to ensure all programs comply with their legal obligations.”
Unless carefully navigated, both public and private employers may find themselves between a rock and a hard place in terms of compliance with federal and state antidiscrimination law.
On the one hand, maintaining policies and conducting mandatory employee training on the subject of preventing unlawful discrimination, harassment, and retaliation is an important step you can use to create a shield against liability in employment discrimination lawsuits. On the other hand, if a company’s policies, programs, and required training are seen by federal agencies as crossing the line into an impermissible DEI initiative, the same policies and training that once served as a shield to liability can now, potentially, be viewed as the cause of the liability itself.
Federal vs. State
Further still, you should consider the interplay between federal and state antidiscrimination law. While the DOJ’s guidance gives insight into how federal agencies, such as the U.S. Equal Employment Opportunity Commission (EEOC), may address what they view as DEI initiatives going forward, Nevada agencies, such as the Nevada Equal Rights Commission (NERC), have not issued similar guidance to date.
Thus, unless policies and practices are crafted with a careful balance in mind, businesses that aim too far toward complying with the federal government’s efforts against DEI programs may find themselves with potential liability under state law.
Takeaway
To avoid scrutiny from federal and state executive agencies and courts alike, you should consult with competent employment law counsel to ensure your employee handbooks, training programs, and other policies and practices comply with existing law.
Shannon S. Pierce is an attorney with Fennemore Law in Reno, Nevada, and can be reached at spierce@fennemorelaw.com.