Affirmative Action Ruling Could Have an Effect on DEI Programs in the Workplace

The Supreme Court of the United States handed down another controversial ruling last month, when it ruled, 6-3, that affirmative action programs in two colleges violated the equal protection clause of the 14^th Amendment.

The ruling, which follows other contentious decisions by the court, bans using race as a factor in college admissions, overturning decades of practices designed to provide more opportunity in higher education to qualified students from minority groups.

Although the ruling does not address hiring or employment practices directly, many who specialize in diversity, equity, and inclusion (DEI) issues said that there are a number of implications for employers. Despite a clear demand from employees for a more equitable and inclusive approach to hiring and promotion, the Supreme Court ruling could open the door for lawsuits and challenges to DEI programs and produce a chilling effect for companies seeking to promote diversity.

What the Supreme Court said The ruling found that race-conscious admissions programs at Harvard and the University of North Carolina were unlawful, adding that race could still be included in discussions such as essays by applicant students. The vote was 6 to 3, with the court’s more liberal members offering blistering dissents noting the overturning of precedent and the controversial application of “color-blind” reasoning.

“The six unelected members of today’s majority upend the status quo based on their policy preferences about what race in America should be like, but is not, and their preferences for a veneer of colorblindness in a society where race has always mattered and continues to matter in fact and in law,” wrote Justice Sotomayor in dissent.

However, Chief Justice John Roberts continued to champion the idea that the only way to avoid discrimination is to end any type of discrimination, even in policies which seek to address historic inequities.

“The Harvard and U.N.C. admissions programs cannot be reconciled with the guarantees of the equal protection clause,” Roberts wrote. “[These] programs lack sufficiently focused and measurable objectives warranting the use of race, unavoidably employ race in a negative manner, involve racial stereotyping and lack meaningful end points.”

The impact on employers

Many observers said that the ruling does not directly apply to the employment world. But considering the flurry of lawsuits being brought by conservative activists and the eagerness of the Supreme Court’s conservative majority to wade into these issues, it is very possible that this version of “colorblindness” could become a legal issue for employers as well.

Krissy Katzenstein, a partner in the Employment & Compensation Practice Group in Baker McKenzie’s New York office, said the ruling could well have reverberations in the workplace. “While not directly applicable to private sector employers, it does reaffirm the long-standing law in the employment space that protected characteristics generally may not be taken into account when making employment decisions,” she said. “Employers should expect continued scrutiny of their [DEI] programs following today’s decision with arguments that these programs impermissibly treat protected characteristics as plus factors, which is unlawful and cannot be justified by the broader goal of a more inclusive, diverse, and equitable workforce. We can expect to see increased litigation in this space in the coming months.”

Kyle Holm, VP of total rewards at Sequoia Consulting Group noted that his firm’s research showed that a majority (59%) of companies currently have a DEI program in place, and nearly one-third of those (28%) have a DEI specialist responsible for hiring candidates with diverse backgrounds, with DEI-related programs continuing to grow in 2023.

Holm added that the ruling could have an impact in several areas. “With affirmative action policies overturned, it remains to be seen what implication the Supreme Court’s decision will have on other legislation,” he said. “For example, pay transparency laws were established to level the playing field for underrepresented groups in the workforce — part of a broader push to change the imbalance of information around compensation.”

And one direct outcome of canceling a tool for increasing the number of minority college graduates in the U.S. is likely to be a smaller pool of diverse job candidates, noted Milena Berry, CEO of PowerToFly, a diversity recruitment and retention platform.

“The end of affirmative action in college admissions will make it even harder for corporations to reach their DEI goals,” Berry said. “First, there could be a reduced pool of diverse candidates entering the workforce, which could make it more challenging for companies to maintain or improve diversity within their organizations.

“Second, the end of affirmative action in college admissions could lead to debates and potential legal challenges around the use of race-conscious policies in employment practices. Companies may need to navigate changing legal landscapes and potentially adjust their diversity and inclusion strategies accordingly.”