by Adam S. Hickey, Marcia E. Goodman, Ruth Zadikany, and Hiral D. Mehta
Left to proper: Adam S. Hickey, Marcia E. Goodman, Ruth Zadikany, and Hiral D. Mehta (images courtesy of Mayer Brown)
On July 29, 2025, U.S. Legal professional Basic Pam Bondi issued Steerage for Recipients of Federal Funding Relating to Illegal Discrimination (the “Steerage”). Following the creation of the Civil Rights Fraud Initiative by the Division of Justice (“DOJ”), and joint steerage issued by DOJ and the U.S. Equal Employment Alternative Fee (“EEOC”) on “illegal DEI-related discrimination“, the Steerage is essentially the most tangible steerage launched to this point on what the administration views as “unlawful DEI” and a possible roadmap for DOJ’s False Claims Act (“FCA”) investigations beneath the Civil Rights Fraud Initiative.
The Steerage (which was addressed to all federal companies however launched publicly) isn’t legally binding, but it surely units forth a view of federal antidiscrimination legal guidelines[1]: that will probably be immediately relevant to recipients of federal funds, and it is usually more likely to be utilized by DOJ and different authorities companies to the broader class of entities and individuals “which are in any other case topic to federal antidiscrimination legal guidelines, together with academic establishments, state and native governments, and private and non-private employers.” The Steerage warns that such entities and individuals could also be topic to authorized actions to implement these legal guidelines.
At a excessive stage, the Steerage advises that utilizing protected traits (together with race, colour, faith, intercourse, and nationwide origin) as a foundation to make choices about “employment, program participation, useful resource allocation, or different related actions, alternatives, or advantages, is illegal,” no matter whether or not the intention or motive is to not drawback any group, per se, however fairly to be optimistic or “preferential.” It goes on to say that use of different traits, corresponding to private experiences or background, socioeconomic standing, first-generation standing, or geographic variety can be unlawful if their objective is to prioritize people based mostly on protected traits.
The Steerage advises that the under, non-exhaustive checklist of insurance policies and practices is illegal and should consequence within the revocation of grant funding in addition to civil legal responsibility. Entities ought to assessment their insurance policies and practices (in addition to these of their contractors, grantees, and different third events) with these examples in thoughts.
GRANTING PREFERENTIAL TREATMENT BASED ON PROTECTED CHARACTERISTICS
In keeping with the Steerage, illegal preferential therapy happens when entities present alternatives, advantages, or benefits in a approach that disadvantages these with out protected traits. Extending unique alternatives through race-based scholarships or applications, prioritizing candidates from underrepresented teams when hiring or for promotions, and designating “secure areas” or lounge entry at universities completely to college students of a selected racial or ethnic group are some examples the Steerage gives.
PROHIBITED USE OF PROXIES FOR PROTECTED CHARACTERISTICS
The DOJ’s Steerage additionally identifies using facially impartial standards as a “proxy” for the express consideration of race, intercourse, or different protected traits. Once more, the supplied rationale is {that a} impartial proxy turns into legally problematic when the standards is chosen as an alternative choice to protected traits, or is applied with the intent to benefit or drawback people based mostly on protected traits.
Examples of illegal proxies embrace evaluating job candidates by their potential to show “cultural competence,” “lived experiences,” or “cross-cultural abilities,” and implementing recruitment methods focusing on particular geographic areas and establishments chosen primarily due to their racial or ethnic composition fairly than different respectable components. Moreover, it’s legally problematic to require that candidates describe “obstacles they’ve overcome,” or to submit a “variety assertion” in a way that benefits those that can describe their expertise as being implicitly tied to their protected attribute.
SEGREGATION BASED ON PROTECTED CHARACTERISTICS
The Steerage considers organizing applications, actions, or sources in a approach that separates or restricts entry based mostly on protected traits as illegal segregation. This contains internet hosting DEI coaching applications that require members to separate into race-based teams for discussions or designating identity-based sources and amenities. The Steerage notes that exceptions to this prohibition are “slim” and embrace solely conditions the place federal legislation expressly permits race-based cures for particular documented acts of previous discrimination by the establishment itself, or in particular contexts the place courts have acknowledged compelling institutional pursuits.
The Steerage explicitly warns that, though compelled segregation based mostly on protected traits is illegal, failing to keep up athletic competitions and intimate areas separated by intercourse might also violate federal legislation. Specifically, the Steerage says federally funded establishments permitting “males, together with these self-identifying as `girls,’ to entry single-sex areas designed for females” (corresponding to loos, showers, locker rooms or dormitories) might undermine privateness, security and equal alternative of girls and ladies and “threat making a hostile surroundings.” The DOJ advises organizations to affirm “sex-based boundaries rooted in organic variations.”
UNLAWFUL USE OF PROTECTED CHARACTERISTICS
Below the Steerage, using protected traits is illegal when a federally funded program considers protected traits as a foundation for choosing candidates for employment, contracts, or program participation. This contains insurance policies mandating various candidate swimming pools or diversity-focused evaluations, sex-based choice for contracts, and requiring a sure share of various members for internship applications.
TRAINING PROGRAMS THAT PROMOTE DISCRIMINATION OR HOSTILE ENVIRONMENTS
In keeping with the Steerage, coaching that—via its content material or construction—stereotypes, excludes, or disadvantages people based mostly on protected traits or creates a hostile surroundings in the direction of others is illegal. An instance supplied is a federally funded faculty district requiring lecturers to finish DEI coaching that stereotypes people based mostly on protected traits (e.g., by use of phrases corresponding to “poisonous masculinity” or “white privilege”).
To keep away from jeopardizing eligibility for federal funding, DOJ recommends the next “Finest Practices” to keep away from “authorized pitfalls of DEI applications:”
- Guarantee inclusive entry to all office applications, actions, and sources, no matter a person’s protected traits (with the exception that “[s]ome intercourse separation is critical the place organic variations implicate privateness, security, or athletic alternative”);
- Give attention to abilities and {qualifications} when deciding on candidates for employment or program participation, fairly than “cultural competence” or socioeconomic standing, first-generation standing, or geographic variety which, whereas not prohibited, “should not be used if chosen to prioritize people based mostly on racial, sex-based, or different protected traits;”
- Discontinue demographic-driven standards in applications and insurance policies, for instance, scholarship applications geared toward “underserved geographic areas” or “first-generation college students” as a result of “[i]ntent to affect demographic illustration dangers violating federal legislation”, as an alternative use “universally relevant standards, corresponding to tutorial benefit or monetary hardship;”
- Doc respectable rationales unrelated to protected traits when hiring, providing promotions, or deciding on contracts and guarantee these rationales are constantly utilized and are demonstrably associated to respectable, nondiscriminatory institutional targets;
- Scrutinize facially impartial standards and doc clear, respectable rationales for his or her use, unrelated to race, intercourse, or different protected traits;
- Get rid of variety quotas in hiring and participation, as an alternative focusing solely on nondiscriminatory efficiency metrics, corresponding to program participation charges or tutorial outcomes;
- Keep away from exclusionary coaching applications (this ties again to the primary “Finest Apply” above);
- Embrace nondiscrimination clauses in contracts with third events and monitor compliance; and
- Set up clear anti-retaliation procedures and create secure reporting mechanisms.
KEY TAKEAWAYS
The Steerage concludes that, “[b]y prioritizing nondiscrimination, entities can mitigate the authorized, monetary, and reputational dangers related to illegal DEI practices and fulfill their civil rights obligations.” Thus, it seems the DO] might look as to if organizations have thought of this Steerage in reviewing federal funding and enforcement actions.
Recipients of federal funds ought to think about assessing their insurance policies and programming in mild of the Steerage and newest “Finest Practices” supplied by the DOJ. This evaluation ought to be utilized to any third-party distributors or contractors used in addition to any joint ventures.
Though the Steerage gives some perception into how DOJ defines “unlawful DEI,” it leaves sure questions open. For one factor, it doesn’t handle whether or not sexual orientation qualifies as a protected attribute in DOJ’s view. Second, though it doesn’t prohibit outreach or recruiting efforts designed to increase the pool of candidates to a program, a assessment of the Steerage would counsel that such efforts ought to be undertaken with cautious consideration to the nuances of this Steerage. The Steerage additionally is totally silent on the interplay with state and native anti-discrimination legal guidelines, in addition to federal Deprived Enterprise Enterprise (DBE) applications (which require recipients of federal funds to fulfill contracting objectives based mostly on protected traits).[2]
The Steerage gives a much more expansive view of “illegal” discrimination and segregation beneath this Administration, protecting not solely specific actions based mostly on protected traits but in addition showing to focus on practices corresponding to contemplating “lived experiences,” geographic focusing on, and overcoming hardship or “obstacles” as proxies for illegal discrimination. Ought to DOJ launch an investigation of a specific observe, topics ought to anticipate a full examination of their actions for compliance with the Steerage, together with employment, contracting, company social accountability, and different charity or group applications. We will additionally count on a big quantity of litigation round DOJ investigation and enforcement efforts based mostly on this Steerage, together with interpretation and software of the steerage itself, to resolve whether or not the Steerage is according to current Supreme Court docket choices and different judicial precedent.
[1] See, e.g., Title VI of the Civil Rights Act of 1964 (discrimination based mostly on race, colour, or nationwide origin), Title VII of the Civil Rights Act of 1964 (employment discrimination based mostly on or motivated by race, colour, faith, intercourse, or nationwide origin), Title IX of the Training Amendments of 1972 (discrimination based mostly on intercourse in teaching programs or actions receiving federal funds), and the Equal Safety Clause of the Fourteenth Modification.
[2] DO] has taken the place that such applications are unconstitutional, to the extent they depend on race-and gender-based presumptions. See Mid-America Milling Co. et al. v. DOT, No. 23 Civ. 72 (GFVT), Doc. No. 82 (E.D. Ky. Could 28, 2025).
Adam S. Hickey, Marcia E. Goodman, Ruth Zadikany, and Hiral D. Mehta are Companions at Mayer Brown. Kelly B. Kramer, Gabrielle Levin, Gina M. Parlovecchio, and Arun G. Rao are Companions, and Ravi Shah and Caitlyn Coffey are Associates at Mayer Brown who additionally contributed to this text. This put up first appeared on the agency’s weblog.
The views, opinions and positions expressed inside all posts are these of the writer(s) alone and don’t signify these of the Program on Company Compliance and Enforcement (PCCE) or of the New York College Faculty of Legislation. PCCE makes no representations as to the accuracy, completeness and validity or any statements made on this web site and won’t be liable any errors, omissions or representations. The copyright of this content material belongs to the writer(s) and any legal responsibility as regards to infringement of mental property rights stays with the writer(s).
by Adam S. Hickey, Marcia E. Goodman, Ruth Zadikany, and Hiral D. Mehta
Left to proper: Adam S. Hickey, Marcia E. Goodman, Ruth Zadikany, and Hiral D. Mehta (images courtesy of Mayer Brown)
On July 29, 2025, U.S. Legal professional Basic Pam Bondi issued Steerage for Recipients of Federal Funding Relating to Illegal Discrimination (the “Steerage”). Following the creation of the Civil Rights Fraud Initiative by the Division of Justice (“DOJ”), and joint steerage issued by DOJ and the U.S. Equal Employment Alternative Fee (“EEOC”) on “illegal DEI-related discrimination“, the Steerage is essentially the most tangible steerage launched to this point on what the administration views as “unlawful DEI” and a possible roadmap for DOJ’s False Claims Act (“FCA”) investigations beneath the Civil Rights Fraud Initiative.
The Steerage (which was addressed to all federal companies however launched publicly) isn’t legally binding, but it surely units forth a view of federal antidiscrimination legal guidelines[1]: that will probably be immediately relevant to recipients of federal funds, and it is usually more likely to be utilized by DOJ and different authorities companies to the broader class of entities and individuals “which are in any other case topic to federal antidiscrimination legal guidelines, together with academic establishments, state and native governments, and private and non-private employers.” The Steerage warns that such entities and individuals could also be topic to authorized actions to implement these legal guidelines.
At a excessive stage, the Steerage advises that utilizing protected traits (together with race, colour, faith, intercourse, and nationwide origin) as a foundation to make choices about “employment, program participation, useful resource allocation, or different related actions, alternatives, or advantages, is illegal,” no matter whether or not the intention or motive is to not drawback any group, per se, however fairly to be optimistic or “preferential.” It goes on to say that use of different traits, corresponding to private experiences or background, socioeconomic standing, first-generation standing, or geographic variety can be unlawful if their objective is to prioritize people based mostly on protected traits.
The Steerage advises that the under, non-exhaustive checklist of insurance policies and practices is illegal and should consequence within the revocation of grant funding in addition to civil legal responsibility. Entities ought to assessment their insurance policies and practices (in addition to these of their contractors, grantees, and different third events) with these examples in thoughts.
GRANTING PREFERENTIAL TREATMENT BASED ON PROTECTED CHARACTERISTICS
In keeping with the Steerage, illegal preferential therapy happens when entities present alternatives, advantages, or benefits in a approach that disadvantages these with out protected traits. Extending unique alternatives through race-based scholarships or applications, prioritizing candidates from underrepresented teams when hiring or for promotions, and designating “secure areas” or lounge entry at universities completely to college students of a selected racial or ethnic group are some examples the Steerage gives.
PROHIBITED USE OF PROXIES FOR PROTECTED CHARACTERISTICS
The DOJ’s Steerage additionally identifies using facially impartial standards as a “proxy” for the express consideration of race, intercourse, or different protected traits. Once more, the supplied rationale is {that a} impartial proxy turns into legally problematic when the standards is chosen as an alternative choice to protected traits, or is applied with the intent to benefit or drawback people based mostly on protected traits.
Examples of illegal proxies embrace evaluating job candidates by their potential to show “cultural competence,” “lived experiences,” or “cross-cultural abilities,” and implementing recruitment methods focusing on particular geographic areas and establishments chosen primarily due to their racial or ethnic composition fairly than different respectable components. Moreover, it’s legally problematic to require that candidates describe “obstacles they’ve overcome,” or to submit a “variety assertion” in a way that benefits those that can describe their expertise as being implicitly tied to their protected attribute.
SEGREGATION BASED ON PROTECTED CHARACTERISTICS
The Steerage considers organizing applications, actions, or sources in a approach that separates or restricts entry based mostly on protected traits as illegal segregation. This contains internet hosting DEI coaching applications that require members to separate into race-based teams for discussions or designating identity-based sources and amenities. The Steerage notes that exceptions to this prohibition are “slim” and embrace solely conditions the place federal legislation expressly permits race-based cures for particular documented acts of previous discrimination by the establishment itself, or in particular contexts the place courts have acknowledged compelling institutional pursuits.
The Steerage explicitly warns that, though compelled segregation based mostly on protected traits is illegal, failing to keep up athletic competitions and intimate areas separated by intercourse might also violate federal legislation. Specifically, the Steerage says federally funded establishments permitting “males, together with these self-identifying as `girls,’ to entry single-sex areas designed for females” (corresponding to loos, showers, locker rooms or dormitories) might undermine privateness, security and equal alternative of girls and ladies and “threat making a hostile surroundings.” The DOJ advises organizations to affirm “sex-based boundaries rooted in organic variations.”
UNLAWFUL USE OF PROTECTED CHARACTERISTICS
Below the Steerage, using protected traits is illegal when a federally funded program considers protected traits as a foundation for choosing candidates for employment, contracts, or program participation. This contains insurance policies mandating various candidate swimming pools or diversity-focused evaluations, sex-based choice for contracts, and requiring a sure share of various members for internship applications.
TRAINING PROGRAMS THAT PROMOTE DISCRIMINATION OR HOSTILE ENVIRONMENTS
In keeping with the Steerage, coaching that—via its content material or construction—stereotypes, excludes, or disadvantages people based mostly on protected traits or creates a hostile surroundings in the direction of others is illegal. An instance supplied is a federally funded faculty district requiring lecturers to finish DEI coaching that stereotypes people based mostly on protected traits (e.g., by use of phrases corresponding to “poisonous masculinity” or “white privilege”).
To keep away from jeopardizing eligibility for federal funding, DOJ recommends the next “Finest Practices” to keep away from “authorized pitfalls of DEI applications:”
- Guarantee inclusive entry to all office applications, actions, and sources, no matter a person’s protected traits (with the exception that “[s]ome intercourse separation is critical the place organic variations implicate privateness, security, or athletic alternative”);
- Give attention to abilities and {qualifications} when deciding on candidates for employment or program participation, fairly than “cultural competence” or socioeconomic standing, first-generation standing, or geographic variety which, whereas not prohibited, “should not be used if chosen to prioritize people based mostly on racial, sex-based, or different protected traits;”
- Discontinue demographic-driven standards in applications and insurance policies, for instance, scholarship applications geared toward “underserved geographic areas” or “first-generation college students” as a result of “[i]ntent to affect demographic illustration dangers violating federal legislation”, as an alternative use “universally relevant standards, corresponding to tutorial benefit or monetary hardship;”
- Doc respectable rationales unrelated to protected traits when hiring, providing promotions, or deciding on contracts and guarantee these rationales are constantly utilized and are demonstrably associated to respectable, nondiscriminatory institutional targets;
- Scrutinize facially impartial standards and doc clear, respectable rationales for his or her use, unrelated to race, intercourse, or different protected traits;
- Get rid of variety quotas in hiring and participation, as an alternative focusing solely on nondiscriminatory efficiency metrics, corresponding to program participation charges or tutorial outcomes;
- Keep away from exclusionary coaching applications (this ties again to the primary “Finest Apply” above);
- Embrace nondiscrimination clauses in contracts with third events and monitor compliance; and
- Set up clear anti-retaliation procedures and create secure reporting mechanisms.
KEY TAKEAWAYS
The Steerage concludes that, “[b]y prioritizing nondiscrimination, entities can mitigate the authorized, monetary, and reputational dangers related to illegal DEI practices and fulfill their civil rights obligations.” Thus, it seems the DO] might look as to if organizations have thought of this Steerage in reviewing federal funding and enforcement actions.
Recipients of federal funds ought to think about assessing their insurance policies and programming in mild of the Steerage and newest “Finest Practices” supplied by the DOJ. This evaluation ought to be utilized to any third-party distributors or contractors used in addition to any joint ventures.
Though the Steerage gives some perception into how DOJ defines “unlawful DEI,” it leaves sure questions open. For one factor, it doesn’t handle whether or not sexual orientation qualifies as a protected attribute in DOJ’s view. Second, though it doesn’t prohibit outreach or recruiting efforts designed to increase the pool of candidates to a program, a assessment of the Steerage would counsel that such efforts ought to be undertaken with cautious consideration to the nuances of this Steerage. The Steerage additionally is totally silent on the interplay with state and native anti-discrimination legal guidelines, in addition to federal Deprived Enterprise Enterprise (DBE) applications (which require recipients of federal funds to fulfill contracting objectives based mostly on protected traits).[2]
The Steerage gives a much more expansive view of “illegal” discrimination and segregation beneath this Administration, protecting not solely specific actions based mostly on protected traits but in addition showing to focus on practices corresponding to contemplating “lived experiences,” geographic focusing on, and overcoming hardship or “obstacles” as proxies for illegal discrimination. Ought to DOJ launch an investigation of a specific observe, topics ought to anticipate a full examination of their actions for compliance with the Steerage, together with employment, contracting, company social accountability, and different charity or group applications. We will additionally count on a big quantity of litigation round DOJ investigation and enforcement efforts based mostly on this Steerage, together with interpretation and software of the steerage itself, to resolve whether or not the Steerage is according to current Supreme Court docket choices and different judicial precedent.
[1] See, e.g., Title VI of the Civil Rights Act of 1964 (discrimination based mostly on race, colour, or nationwide origin), Title VII of the Civil Rights Act of 1964 (employment discrimination based mostly on or motivated by race, colour, faith, intercourse, or nationwide origin), Title IX of the Training Amendments of 1972 (discrimination based mostly on intercourse in teaching programs or actions receiving federal funds), and the Equal Safety Clause of the Fourteenth Modification.
[2] DO] has taken the place that such applications are unconstitutional, to the extent they depend on race-and gender-based presumptions. See Mid-America Milling Co. et al. v. DOT, No. 23 Civ. 72 (GFVT), Doc. No. 82 (E.D. Ky. Could 28, 2025).
Adam S. Hickey, Marcia E. Goodman, Ruth Zadikany, and Hiral D. Mehta are Companions at Mayer Brown. Kelly B. Kramer, Gabrielle Levin, Gina M. Parlovecchio, and Arun G. Rao are Companions, and Ravi Shah and Caitlyn Coffey are Associates at Mayer Brown who additionally contributed to this text. This put up first appeared on the agency’s weblog.
The views, opinions and positions expressed inside all posts are these of the writer(s) alone and don’t signify these of the Program on Company Compliance and Enforcement (PCCE) or of the New York College Faculty of Legislation. PCCE makes no representations as to the accuracy, completeness and validity or any statements made on this web site and won’t be liable any errors, omissions or representations. The copyright of this content material belongs to the writer(s) and any legal responsibility as regards to infringement of mental property rights stays with the writer(s).
