In the wake of the Supreme Court’s landmark decision that prohibits universities from expressly considering race in the admissions decision-making process, scrutiny of companies’ diversity programs has increased.  The aftermath of the ruling has private employers asking whether the opinion affects their commitments to diversity, equity, and inclusion (DEI) efforts, including supplier diversity programs, employee resource groups, hiring and recruiting initiatives, and scholarship programs, among other initiatives.  

Background

Students for Fair Admissions, Inc. v. University of North Carolina and Students for Fair Admissions, Inc. v. President & Fellows of Harvard College

Students for Fair Admissions (SFFA) filed separate lawsuits against Harvard and the University of North Carolina (UNC), arguing that their race-based admissions programs violated Title VI and the Equal Protection Clause of the Fourteenth Amendment.

Both schools argued that their programs were consistent with the standards set in prior Supreme Court precedent which provided that a university could lawfully consider an applicant’s race without violating Title VI or the US Constitution if the university was seeking to further student diversity and if race was one factor among many considered in evaluating the applicant.  Prior precedent barred racial quotas but permitted other race-conscious recruitment and admissions programs.

Supreme Court’s Decision

The Supreme Court found that Harvard’s and UNC’s race-conscious admissions policies failed strict scrutiny, and therefore were unlawful.  The majority opinion focused on the limitations, such as the need for measurable goals and a logical end to race-based admissions practices in making its decision.   

First, the Court found that the interests the schools viewed as compelling could not “be subject to meaningful judicial review.”  Both schools identified similar education benefits such as training future leaders, enhancing empathy and cross-racial understanding, and producing new knowledge.  The Court determined that, “[a]lthough these are commendable goals, they are not sufficiently coherent for purposes of strict scrutiny” and “it is unclear how courts are supposed to measure any of these goals.” 

Second, the Court found that the “admissions programs fail to articulate a meaningful connection between the means they employ and the goals they pursue.”  The Court described the race categories used by the universities as “imprecise in many ways” – with some being over-inclusive, while others were under-inclusive.

Third, the Court determined that using race as a “plus” factor will “unavoidably employ race in a negative manner,” finding that “[a] benefit provided to some applicants but not to others necessarily advantages the former group at the expense of the latter.” 

Fourth, the Court stated that the race-based admissions programs improperly tolerate stereotyping, including the “offensive and demeaning assumption that students of a particular race, because of their race, think alike” or at least think differently from nonminority students.

Finally, the Court found that the admissions programs did not have a “logical end point” contrary to the expectations set in prior precedent.  Moreover, the universities did not have plans to end their race-based admissions decisions. 

Next Steps

The Court’s decision is based exclusively on college admissions practices.  Both institutions are bound by Title VI of the Civil Rights Act, which does not govern private employment. Title VII of the Civil Rights Act governs private employment and it remains to be seen whether and how the decision will impact challenges to DEI efforts in the private sector.  Nevertheless, based on the potential implications and likelihood that litigants will attempt to apply this decision to challenge employers’ DEI programs, we encourage employers to:

• Conduct an audit of the company’s existing DEI programs and assess the potential risk of challenges in light of this decision. The decision does not prohibit employers from pursuing diversity initiatives in the workplace. Instead, the decision is essentially silent on employment-related questions. Following the ruling, the United States EEOC Chair issued a statement that read, in part, “It remains lawful for employers to implement diversity, equity, inclusion and accessibility programs that seek to ensure workers of all backgrounds are afforded equal opportunity in the workplace.”  Employers should review their existing DEI programs taking into account the factors evaluated in this decision.

• Review and revise, if needed, internal communications about DEI programs and strategies. The Court did not state that diversity is not important.  Universities are not prohibited “from considering an applicant’s discussion of how race affected his or her life, be it through discrimination, inspiration, or otherwise.”  Employers are encouraged to review communications about the objectives and execution of their DEI initiatives.

• Provide training to educate managers, recruiters, and other decision-makers about the company’s policies and procedures, including areas of risk. It has never been legally permissible to make employment decisions specifically because of a person’s protected class (such as race, gender, or sexual orientation.) This remains true. Employers should provide training to reiterate the company’s commitment to complying with the law and to ensure decision-makers are aware of the company’s policies and procedures.

• Stay abreast of legal developments, including state-specific laws and directives.