Decisions About Diversity Programs Carry Consequences
4.21.2025
With the Trump administration questioning the legality of diversity, equity and inclusion initiatives, employers must figure out what to do going forward. Companies face risk when they decide to continue their diversity programs but abandoning them has downsides too. It depends on how much risk an organization is willing to take on.
A recent Continuing Legal Education Course hosted by the New York State Bar Association addressed the legal landscape and what employers must consider when determining next steps.
The panelists were:
- Nicholas H. De Baun, partner at Seyfarth Shaw.
- Andrew M. Lieb, managing partner at Lieb at Law.
- Nic Rangel, executive director of the Legal Aid Society of Northeastern NY.
Loren Gesinsky, chair of the Labor and Employment Law Section, delivered opening remarks.
Executive Orders Contradict Existing Policy
“In my 30 years of practice, I have rarely seen a time when the legal landscape has been so fluid and subject to change as it is in this area,” De Baun said. “I would have to go back quite a way to think of a time when things were so uncertain.”
Even before the new administration took over in January, programs promoting diversity were on shaky legal ground. In 2023, the U.S. Supreme Court ruled that race-conscious admissions policies are unconstitutional in Students for Fair Admissions, Inc. v. President and Fellows of Harvard College and Students for Fair Admissions, Inc. v. University of North Carolina.
In January, the administration released an executive order ending affirmative action requirements for federal contractors. Another required all federal agencies to identify and stop DEI practices within 120 days.
“The order does not define unlawful,” said De Baun. “And so, it’s left to us to look to the case law, pronouncements of officials, and other actions taken by the administration to figure out what position the administration is going to take regarding what’s unlawful – and what position the courts are likely to take.”
Another Executive Order ended federal recognition of transgender people, contradicting the U.S. Supreme Court decision in Bostock v. Clayton County, which determined that anti-LGBTQ employment discrimination violates federal law.
The New York State Human Rights Law explicitly protects gender identity and expression.
“So, we have this governmental Executive Order conflicting directly with state law,” Lieb said.
Considerations for Employers
The panelists recommended that employers review all DEI initiatives and practices to determine if any do not comply with federal directives. Instead of programs that are restricted to underrepresented groups, diversity should be achieved through other means, such as geographic origins, economic status, or educational background, the panelists said.
“The protected classes have grown over the years and may continue to grow to include additional classes,” said Rangel. “But also, there’s a lot of value in thinking about diversity more broadly.”
All stakeholders within the company – Human Resources, management, leaders, communications team, labor – should be involved in this process.
“Make sure your outside counsel is present, so you have attorney-client privilege in those conversations,” said Lieb. “And please don’t make decisions on the spot and instead let your lawyer write you a risk assessment.”
Another way to comply with federal directives is to make sure that employee resource and affinity groups are open to allies, so they are not exclusionary.
The panelists said that employers must weigh their tolerance for risk – both legal and reputational. Can they take the risk of a lawsuit – either from keeping a program or changing it? And how will the public react to any actions they take?
“Part of it isn’t [just] what you want to choose,” said Lieb. “It’s how much you want to fight as well.”
Employers are also advised to closely monitor ongoing litigation, as any rulings or official government announcements may drastically change the legal landscape.
“If we’re evaluating our initiatives and practices but we’re doing it with the lens of inclusivity and equal opportunity – which is the ultimate goal of DEI initiatives – I think that’s the appropriate lens to be thinking about what kind of policies you have internally,” said Rangel. “Are they inclusive? Do they provide equal opportunity?”
The program was sponsored by the Labor and Employment Law Section and the Committee on Diversity, Equity, and Inclusion. View the full program here.
