DEI in 2026: Latest Developments

Information in this blog is based on a webinar OutSolve hosted on March 11, 2026 titled DEI Developments in 2026: An Employer Update from OutSolve and Roffman Horvitz. You can download the recording here.

In a landscape where headlines regarding the legality and future of Diversity, Equity, and Inclusion (DEI) are surfacing daily, the pressure on organizations to justify their internal initiatives has never been higher.

With the rescission of key federal Executive Orders (EO), the addition of new EOs, and a surge in agency subpoenas, simply maintaining the status quo is no longer a viable strategy. Now is the time to conduct a proactive "Review-Keep-Fix" analysis of your DEI programs to ensure they remain compliant with shifting anti-discrimination laws while avoiding the crosshairs of federal litigation. Here are the most notable recent developments:

Significant Developments That Have Occurred Since March 11, 2026

New Executive Order Pertaining to DEI Discrimination by Federal Contractors

On March 26, 2026, President Trump issued Executive Order (EO) 14398 (“Addressing DEI Discrimination by Federal Contractors)” The EO addresses DEI activities that discriminate via disparate treatment by race or ethnicity. The EO does not cover disparate treatment for other categories such as sex, national origin, religion, age, and disability status.

The EO includes two definitions:

(a) For the purposes of this order, “racially discriminatory DEI activities” means disparate treatment based on race or ethnicity in the recruitment, employment (e.g., hiring, promotions), contracting (e.g., vendor agreements), program participation, or allocation or deployment of an entity’s resources.

(b) “Program participation” means membership or participation in, or access or admission to: training, mentoring, or leadership development programs; educational opportunities; clubs; associations; or similar opportunities that are sponsored or established by the contractor or subcontractor.

Executive Order 14398, Section 2.

The EO calls for contracting agencies to include a new six paragraph clause in contracts within 30 days (April 25, 2026). The clause’s six paragraphs fall into four categories:

1. Having the contractor agree that it will not engage in any racially discriminatory DEI
2. Calling for contracting agencies to investigate contractor compliance via audits of records and information requests (those contractors found in noncompliance risk contract cancellation, termination, or suspension, and ineligibility for future Government contracts)
3. Placing responsibility for subcontractor compliance with the prime contractor, and
4. Using the False Claims Act to enforce compliance with the Executive Order.

The EO calls for the Office of Management and Budget to prepare guidance for contracting agencies in how to ensure compliance with the EO. It also calls for identification of economic sectors (i.e., industries) that “pose a particular risk” of engaging in racially discriminatory DEI activities and the establishment of best practice for ensuring compliance in those sectors.

The Federal Acquisition Regulatory Council has until May 25, 2026 to issue deviation and interim guidance to the Federal Acquisition Regulations (FAR) implementing the new contract clause, pending formal promulgation of a FAR clause. Read more here.

State of Florida Letter to the NFL Regarding the “Rooney Rule”

The Attorney General for the State of Florida, Jame Uthmeier, sent a letter to National Football League (NFL) Commissioner Roger Goodell on March 25, 2026, requesting that the NFL confirm by May 1, 2026 that it no longer requires use of the “Rooney Rule” or similar diversity programs.

The Rooney Rule requires NFL teams to interview a certain number (either one or two, depending on the type of position) of minority candidate for coaching, general manager, and senior executive positions. The NFL also has gender-based diversity initiatives. The Florida Attorney General asserts that the Rooney Rule and similar NFL programs are unlawful under Florida law because they discriminate on the basis of race, color, sex, etc.

The Rooney Rule is one of the most well-known “diverse slate” programs. Whether diverse slate programs comply with anti-discrimination laws hasn’t been clear. In other words, diverse slate programs have been among the riskier types of DEI initiatives. Florida’s focus on such programs aligns with anti-DEI initiatives at the federal level—most notably the Federal Trade Commission’s challenge of the legal industry’s Mansfield Certification program, which also includes commitments to consider a certain threshold of diverse candidates for job opportunities.

Proposed SAM Registration DEI Certification

The General Services Administration (GSA) has proposed a new certification in the System for Award Management (SAM) requiring registrants for federal financial assistance (i.e., grants) to attest that they do not operate "illegal” DEI programs. Public comments are being accepted until March 30, 2026.

Required attestations for SAM registration typically have tracked clauses from the Federal Acquisition Regulations (FAR), which pertains to federal contracts, or Title 2 of the Code of Federal Regulations, which pertains to federal financial assistance. There isn’t yet a FAR clause or Title 2 clause that implements the EO 14173 certifications. Thus, adding certification language to SAM regarding illegal DEI seems premature.

The proposed SAM certification language goes well beyond the original two-clause certification language in EO 14173. Here is the language in the EO:

• Agree that its compliance in all respects with all applicable Federal anti-discrimination laws is material to the government's payment decisions for purposes of the False Claims Act
• Certify that it does not operate any programs promoting DEI that violate any applicable Federal anti-discrimination laws

Also noteworthy is the fact that the proposed SAM certification clause mentions only discrimination on the basis of race or color. EO 14173 applies to DEI programs that “violate any applicable Federal anti-discrimination laws.” Those laws apply to many classifications, including sex, religion, national origin, disability status, and age. In this respect, the proposed SAM certification clause comes up short of the mandate of EO 14173.

And yet on the other hand, the proposed SAM registration clause goes well beyond the EO in defining what programs are seen as “unlawful” DEI.

1. Granting preferential treatment based on race or color, such as race-based scholarships or programs, preferential hiring or promotion practices, or access to facilities or resources based on race or ethnicity, including through the use of “cultural competence” requirements, “overcoming obstacles” narratives, or “diversity statements;”
2. Segregation based on race or color, such as race-based training sessions, segregation in facilities or resources, or implicit segregation through program eligibility;
3. Other unlawful use of race or color as criteria, such as race-based “diverse slate” policies in hiring, race-based selection for contracts, or race-based program participation or resource allocation;
4. Training programs that stereotype, exclude, or single out individuals based on protected characteristics or create a hostile environment; or
5. Retaliation by taking adverse actions against employees, participants, or beneficiaries because they engage in protected activities related to opposing DEI practices they reasonably believe violate federal antidiscrimination laws. Protected activities include raising concerns or filing complaints about, or objecting to or refusing to participate in, discriminatory programs, trainings, or policies;” (emphasis added)

Many of these examples are things that haven’t previously been seen as violating anti-discrimination laws.

Unlawful DEI

July 29, 2025 Attorney General Guidance

The examples of unlawful DEI in the proposed SAM certification language are derived from July 29, 2025 guidance issued by the Attorney General. That document identifies the Attorney General’s view of "best practices" for recipients of federal funding regarding unlawful discrimination related to DEI. The memo explicitly states that these are not mandatory but rather best practices. Some of the example practices haven’t previously been seen as violating Federal anti-discrimination laws.

Here are some noteworthy examples that the Attorney General’s memo purports are potentially unlawful that generally have always been seen as lawful:

• Geographic or institutional targeting in recruitment strategies
• Programs, activities, or resources that are “technically” open to all, but identity-based in focus (perception of segregation; hostile work environment)
• Assertion that DEI trainings potentially create a hostile work environment
• Making DEI training mandatory

EEOC Letter to Fortune 500 Companies

The EEOC issued a letter to Fortune 500 leadership on February 26, 2026. This letter highlights previous DOJ / EEOC guidance issued in March 2025 regarding unlawful DEI-related discrimination—both a one-page technical assistance document and a Q&A document.

While the DOJ / EEOC characterizes these technical assistance and Q&A documents as "non-binding," they serve as a reasonable distillation and consensus view of which DEI initiatives may violate current nondiscrimination laws.

March 19, 2025 DOJ / EEOC Guidance

The March 19, 2025 DOJ/EEOC guidance identified the following DEI initiatives as unlawful:

• Disparate treatment in:
  • hiring, firing, promotion, demotion, compensation, or fringe benefits
  • Access to or exclusion from training (including training characterized as leadership development programs)
  • Access to mentoring, sponsorship, or workplace networking / networks
  • Internships (including internships labeled as “fellowships” or “summer associate” programs)
  • Selection for interviews, including placement or exclusion from a candidate “slate” or pool
  • Job duties or work assignments
• Limiting membership in ERGs or employee affinity groups
• Separating employees based on race, sex, or another protected category
• Harassment (DEI training messaging)

The March 2025 DOJ/ EEOC guidance focused on what DEI programs may be unlawful. It provided no guidance on what DEI initiatives are lawful. The absence of any mention of lawful DEI initiatives prompted a March 4, 2026 counter-letter from former Democratic EEO officials, which pointed to guidance that they had issued in April 2025 and November 2025 regarding lawful DEI initiatives.

• Chicago Women in Trades v. Trump (7^th Circuit)
  • Oral argument hearing - 1/30/2026
  • “What is ‘unlawful DEI’?”
• Young v. Colorado Dept. of Corrections (10^th Circuit)
  • Oral argument hearing – 1/22/2026
  • Skeptical that DEI training created a hostile work environment
• Missouri v. Starbucks (E.D. Mo.)
  • Suit brought by Missouri Attorney General that alleged that Starbuck’s DEI programs were discriminatory was dismissed – 2/5/2026
  • “Plaintiff fails to allege any actual adverse employment action undertaken as a result of unlawful discrimination, and the policies and goals described do not confer employment opportunities to one protected class at the expense or to the exclusion of another. Plaintiff's reliance on allegations that Defendant adopted certain alleged policies does nothing to establish actual justiciable claims without any allegations as to how those policies were actually enforced in a way that violated any law.”
• EEOC v. Coca-Cola Beverages Northeast, Inc. (D.N.H., 2/18/2026)
  • EEOC lawsuit alleges that two-day employer-sponsored trip and networking event open only to female employees discriminated against male employees
  • EEOC Press Release

Federal Court Cases – Status of Injunctions on Anti-DEI Executive Orders

• National Association of Diversity Officers in Higher Education v. Trump (4^th Circuit)
  On February 6, 2026, a court reversed the injunction against the Trump DEI Executive Orders, ruling that the certification and termination provisions are not facially unlawful and that plaintiffs lacked standing to challenge enforcement threats. While the panel upheld the orders for now, the court noted that the specific manner in which these provisions are ultimately implemented or enforced could still face future legal challenges. 
• Chicago Women in Trades v. Trump (N.D. Ill)
  The Chicago Women in Trades (CWIT) was able to obtain injunctions related to EO 14173. Those injunctions are limited: 
  • The Department of Labor (the agency that CWIT sued) was enjoined from terminating the CWIT grant references in the litigation. This injunction did not apply to any other agencies or any grants other than the specific CWIT grant at issue in the litigation.
  • The Department of Labor was enjoined form requiring any grantee or contractor to make the EO 14173 certifications. This injunction applied only to the Department of Labor. There was no injunction via other federal agencies.
  • The entire government was enjoined from initiating a False Claims Act (FCA) enforcement action pursuant to the EO 14173 certification provision against CWIT. While this injunction applied to the entire federal government, it was limited to CWIT. There was no injunction related to FCA enforcement against other employers.

Presentation by DOJ Official About False Claims Act Enforcement

Deputy Attorney General Brenna Jenny presented at the Federal Bar Association’s 2026 Qui Tam Conference on February 19, 2026. Several of the reported comments she made about the DOJ’s pursuit of unlawful DEI under the FCA are noteworthy.

The existence of DEI programs doesn’t necessarily mean that the employer is violating nondiscrimination laws. The DOJ is focusing on discrimination (i.e., DEI programs that actually discriminate on the basis of sex and race/ethnicity). DOJ sees the following as particularly problematic practices that it expects to pursue under the FCA:

• Numeric demographic goals
• Tying employee compensation and bonuses to meeting diversity targets
• Tying performance evaluations to diversity efforts
• Training or mentoring programs open only to certain groups
• Diverse slate policies

 Jenny also noted that the DOJ is using data-mining capabilities in addition to information that it receives from Qui Tam relators.  

EEOC Federal Court Subpoena Enforcement Actions

Nike (E.D. Mo., 2/4/2026)

The EEOC’s investigation into Nike stems from a May 2024 Commissioner’s Charge by Andrea Lucas, which alleges that the company's DEI programs unlawfully discriminate against white workers. EEOC is demanding extensive records dating as far back as June 2018:

• documents or information showing Nike’s organizational structure from June 1, 2019 to the present
• information and documents related to layoffs of employees in Nike’s U.S. Corporate workforce from January 1, 2024 to the present
• documents related to Nike’s use of racial or ethnic minority worker data as a factor in setting executive compensation from June 1, 2019 to the present
• data, if maintained, regarding the employment of racial or ethnic minority employees within Nike’s U.S. Corporate workforce from June 1, 2019 to the present
• information regarding Nike’s “Diverse Slates” process and its use from June 1, 2018 to the present
• information about Nike’s participation in sixteen different diversity programs and the individuals who applied to, were considered for, were accepted to / selected for, or were rejected from / not selected for those programs, and
• information related to Nike’s use of “representation data” as referred to in its FY20 Impact Report.

Napa Auto Parts (N.D. Tex., 2/5/2026)

Following a 2024 Commissioner’s Charge by Kalpana Kotagal, the EEOC is investigating allegations of discrimination against Black workers by Napa Auto Parts in hiring and recruiting. EEOC is seeking information about specific programs and hiring processes as well as nearly all HRIS and applicant tracking data dating back to October 2019. The EEOC stated that it needed the information to “conduct statistical analysis of Respondent’s hiring and recruitment patterns to detect indicia of discrimination, and [ ] allow identification and location of witnesses who can recount their experiences in Respondent’s hiring process (e.g., provide direct or circumstantial evidence of race-based disparate treatment), explain the hiring criteria and selection process, and describe the nature of the jobs that were the subject of the hiring decisions being analyzed.”

Northwestern Mutual (E.D. Wis., 11/20/2025)

An EEOC investigation into Northwestern Mutual, sparked by a March 2025 charge from a white male employee who alleges that the company’s enhanced Diversity Equity & Inclusion Policy unlawfully discriminates by favoring women and people of color. Several of EEOC’s requests pertain to the charging party’s job and his peer employees. But EEOC also is requesting information pertaining to employer programs more generally. EEOC is demanding internal data and affirmative action plans dating back as far as 2020 to determine if these specific DEI initiatives violate Title VII. Two requests are particularly noteworthy for their potential breadth:

• all documents or analysis that the employer relied upon in stating that it “does not believe its Diversity & Inclusion goals are in violation of Title VII”
• documents sufficient to identify the performance management system and/or human resource information system and the various metrics tracked by the system, including documents sufficient to identify the systems used to track Diversity & Inclusion progress and goals.

University of Pennsylvania (E.D. Pa., 11/18/2025)

On March 31, 2026, a federal judge ordered the University of Pennsylvania to the comply with an EEOC subpoena that sought, among other things, the names and personal contact information of Jewish faculty members and employees, including student employees. The subpoena was issued as part of an investigation into a potential antisemitic work environment at the University.

The judge noted in his decision that the EEOC has wide discretion and is given broad deference regarding the scope of its investigations. The judge stated that the court reviews only if the overall investigation is valid and if the information that EEOC seeks is relevant. Concerns about privacy and how lists of Jewish names were used to further atrocities during the Holocaust were not relevant to the EEOC’s right to the information.

This result indicates that EEOC has a good chance of being successful in other subpoena enforcement actions, including the ones filed against Nike, Napa Auto Parts, and Northwestern Mutual.

Disparate Impact

In the context of employment practices, disparate impact liability establishes that if a facially neutral employment practice has a disparate impact on the basis of race, religion, sex, or national origin, the employer must show that the practice is job related for the position and consistent with business necessity.

Executive Order 14281: Restoring Equality of Opportunity and Meritocracy

Executive Order 14281 formally shifts the executive branch's enforcement priorities by instructing federal agencies to deprioritize and cease pursuing disparate impact claims. By defining the administration's narrow view of liability, the order effectively directs agencies to move away from challenging neutral policies that result in statistically different outcomes for protected groups.

However, the executive order is limited in scope; it cannot remove disparate impact protections from Title VII or other federal civil rights laws, as these are established by statute and judicial precedent. Furthermore, it does not override state-level anti-discrimination laws or eliminate the use of statistical evidence in broader employment discrimination litigation.

Legal Status of Disparate Impact Theory

Under the current administration, the EEOC has ceased investigating or enforcing claims based on disparate impact, instead issuing "Notice of Right to Sue" letters that require charging parties to pursue such cases independently in federal court within 90 days.

That said, disparate impact is codified in Title VII via in the Civil Rights Act of 1991, which was passed by huge bipartisan majorities. Also, as EEOC has retreated from enforcing disparate impact claims, the states are reinforcing disparate impact claims. Notably, New York formally codified disparate impact liability effective December 19, 2025, and New Jersey adopted comprehensive new regulations on December 15, 2025, specifically to counter the federal rollback.

Disparate impact liability continues to exist at the state level.

Trump Administration Use of Data and Statistics

Despite its retreat from disparate impact liability, the Trump administration still uses data analysis to identify potential areas of discrimination. EEOC Chair Andrea Lucas stated in a May 7, 2025 post on LinkedIn that the EEOC will continue to use statistical evidence to prove the existence of a “pattern or practice” of disparate treatment. In other words, data and statistical evidence will continue to be an important investigatory and legal tool for EEOC. The subpoena enforcement actions against Nike, Napa Auto Parts, and Northwestern Mutual are indicative of this.

The Trump Administration also is looking to add information to the Integrated Postsecondary Education Data System (IPEDS) reporting that will allow the Administration to monitor race-based admissions at colleges and universities. This is being done pursuant to an August 2025 Presidential Memorandum.

Successful Federal Agency Regulatory Pressure Initiatives

Federal Communications Commission

The Federal Communications Commission (FCC) has leveraged its regulatory authority to secure concessions from major media and telecommunications firms related to their DEI programs and practices. FCC Chair Brendan Carr has stated that FCC might block mergers involving companies that promote DEI. Indeed, that appears to be what has been happening.

In 2025, three major mergers/acquisitions were approved by FCC only after the companies submitted letters that sufficiently addressed their DEI programs. The amount of time between letter submission and regulatory approval—1 day, 2 days, and 3 days—is telling.

Federal Trade Commission

The Federal Trade Commission (FTC) issued letters to 42 large law firms on January 30, 2026, alleging that participation in the Mansfield Certification Program constitutes "anticompetitive collusion." This aggressive stance led to the immediate pause of the program and the near-total furlough of the staff at Diversity Lab, the organization that oversaw the Mansfield Certification Program. The FTC was able to shut down one of the most important diversity initiatives in the legal industry simply through issuance of a threatening letter. This was the culmination of an entire year focusing on the legal industry and its DEI initiatives, which no doubt already had a significant impact on Diversity Lab and the Mansfield program. Indeed, one of the Administration’s earliest anti-DEI initiatives occurred on March 17, 2025, when the EEOC sent information request letters to 20 large law firms regarding their DEI programs. The Administration was able to obtain commitments related to DEI programs and for millions of dollars of pro bono work for causes of interest to the Administration from a few of the firms who received these letters.

EEOC ultimately withdrew these letters on February 9, 2026, resolving a legal challenge to its authority to issue the letters. Doe1 v EEOC (D.D.C., 2/9/2026).

Tactical Retreats and Refined Enforcement Strategies

The Administration’s efforts to achieve retreat from DEI initiatives have homed in on two effective enforcement strategies—(1) regulatory/political pressure campaigns and (2) aggressive and burdensome investigations and information requests.

Both of these strategies achieve the Administration’s policy goal of peeling back at DEI initiatives without putting its EOs or its position about the unlawfulness of DEI programs in legal jeopardy.

Notably, both the March 19, 2025 EEOC/DOJ and July 29, 2025 Attorney General documents were characterized as “nonbinding” or “best practices.” Administration attorneys have been reluctant to specify in court what DEI is unlawful. The FAR Council has yet to approve the FAR clause that would implement the EO 14173 certifications. In response to legal challenges, the EEOC withdrew the March 17, 2025 letters that it sent to 20 law firms. Doe1 v EEOC (D.D.C., 2/9/2026). Similarly, the Department of Education pulled the certification it announced on April 3, 2025 for K-12 schools receiving federal financial assistance. This too was in response to legal challenges. New York v. Dept of Education (D. Mass., 2/6/2026); National Education Assoc. v. Dept of Education (D.N.H., 2/3/2026); American Fed. of Teachers v. Dept. of Education (4th Cir., 1/22/2026; D. Md., 8/14/2025).

The current enforcement climate reveals a strategic push by federal agencies to reshape corporate DEI initiatives. The Administration has pivoted toward a more aggressive pursuit of what they deem "unlawful DEI." This shift is being driven through high-pressure regulatory campaigns and information requests designed to force a DEI retreat.

Despite this heightened scrutiny, there is a palpable reluctance from these agencies to provide a concrete definition of what actually constitutes "unlawful DEI." Ultimately, for contractors and employers, the message is clear: the "definition" remains a moving target, making it increasingly more important to conduct a Review-Keep-Fix analysis on your DEI programs and policies so you do not end up on the receiving end of burdensome investigations or litigation.

DEI Development in 2026 Recording

Download our DEI Developments in 2026: An Employer Update webinar to hear from OutSolve CEO, Jeremy Mancheski, and Roffman Horvitz attorneys, Josh Roffman and Alissa Horvitz, as they break down the most important activity at a federal and state level regarding DEI. It also includes EEOC enforcement, OFCCP updates, and litigations tied to anti-DEI orders. Download the recording today.