Affirmative action statements can also upend hiring policies

Legally, the Supreme Court’s rejection of race-conscious admissions to higher education does not in itself prevent employers from pursuing diversity in the workplace.

At least that’s the conclusion of lawyers, diversity experts, and political activists across the spectrum — from conservatives who say robust affirmative action programs are already illegal to liberals who claim they’re on solid legal grounds.

But many experts argue the ruling will, in practice, discourage companies from implementing ambitious diversity policies in hiring and promotion — or push them to rein in existing policies — by encouraging lawsuits under the existing legal standard.

After Thursday’s decision on university admissions, law firms companies encouraged to review their diversity policy.

“I worry about corporate consultants who see it as their most important job to keep organizations from being sued — I do worry about hypercompliance,” said Alvin B. Tillery Jr., director of the Center for the Study of Diversity and Democracy at Northwestern University, which advises employers on diversity policies.

Programs to promote the hiring and promotion of African Americans and other minority workers have been prominent in corporate America in recent years, especially in the reckoning race following the 2020 murder of George Floyd by a Minneapolis police officer.

Even before the ruling in the college cases, companies felt legal pressure for their diversity efforts. For the past two years, a lawyer who has a free market group sent letters to US airlines, McDonald’s and many other companies are demanding that they reverse hiring policies that the group says are illegal.

The free-market group, the National Center for Public Policy Research, acknowledged that Thursday’s outcome did not directly affect its fight against affirmative action in corporate America. “Today’s decision is irrelevant; it was about a special education carve-out,” said Scott Shepard, a staff member at the center.

Mr Shepard nonetheless claimed victory, arguing the ruling would help deter employers who might be tempted to break the law. “It couldn’t be more clear after the decision that it’s not allowed to cloud it on the edges,” he said.

(American Airlines and McDonald’s did not respond to requests for comment about their hiring and promotion policies.)

Charlotte A. Burrows, who was designated by President Biden to chair the Equal Employment Opportunity Commission, was also quick to state that nothing had changed. She said the decision “does not address employers’ efforts to promote a diverse and inclusive workforce or to attract the talents of all qualified employees, regardless of their background.”

Some companies targeted by conservative groups underlined the point. “Novartis’ DEI programs are precisely tailored, fair, equitable and compliant with existing laws,” the drugmaker said in a statement, referring to diversity, equity and inclusion. Novartis has also received a letter from a lawyer representing Mr. Shepard’s groupdemanding that it change its policy on hiring law firms.

In addition to government contractors, affirmative action policies in the private sector are largely voluntary and governed by state and federal civil rights law. These laws prohibit employers from basing hiring or promotion decisions on characteristics such as race or gender, whether in favor of or against a candidate.

The exception, said Jason Schwartz, a partner at the law firm Gibson Dunn, is that companies can take race into account if members of a racial minority were previously excluded from a job category — for example, an investment bank that recruited Black bankers after it excluded Black people from such jobs for decades. In some cases, employers may also consider the historical exclusion of a minority group from an industry, such as black and Latino people in the software industry.

In principle, the logic of the Supreme Court ruling on college admissions could threaten some of these programs, such as those designed to address discrimination across the industry. But even here, the litigation can be lengthy because the way employers typically make hiring and promotion decisions differs from the way colleges make admissions decisions.

“What seems to bother the court is that the admissions programs in question treated race as an asset regardless of the individual student,” Pauline Kim, a professor at Washington University in St. Louis who specializes in employment law, said in an e-mail. mail. But “job decisions are more often individual decisions,” focusing on the match between a candidate and a job, she said.

The more meaningful effect of the court’s decision is likely to be greater pressure on policies that were already based on questionable legal grounds. These may include leadership acceleration programs or internship programs open only to members of underrepresented minority groups.

Many businesses can also be vulnerable to policies that comply with civil rights laws on paper but violate them in practice, says Mike Delikat, a partner at Orrick who specializes in employment law. For example, a company’s policy may encourage recruiters to look for a more diverse pool of candidates from which hiring decisions are made without regard to race. But if recruiters implement the policy in a way that effectively creates a race quota, he said, it’s illegal.

“The devil is in the details,” said Mr. Delikat. “Did they interpret that as, ‘Come back with 25 percent of the internship class that must be from an underrepresented group, or else you’ll be labeled a bad recruiter’?”

The university’s admissions cases before the Supreme Court have been largely silent on these employment-related issues. Nevertheless, Mr Delikat said, since the court agreed to hear the cases, his firm has been advising clients to ensure their policies are airtight as an increase in litigation is likely.

That’s partly because of the growing attack from the right on corporate policies aimed at diversity in hiring and other social and environmental goals.

Florida Gov. Ron DeSantis, who is seeking the 2024 Republican presidential nomination, has regretted “the wake-mind virus” and proclaimed Florida “the state where Wake goes to die.” The state has enacted legislation to limit diversity training in the workplace and has limited dissuade state pension funds from basing investments on environmental, social and corporate governance considerations.

Conservative legal groups have also mobilized on this front. A group led by Stephen Miller, a White House adviser in the Trump administration, argued in letters to the Equal Employment Opportunity Commission that the diversity and inclusion policies of several large companies were illegal and asked the commission to investigate. (Mr. Miller’s group did not respond to a request for comment on those matters.)

The National Center for Public Policy Research, which challenges corporate diversity policies, has sued Starbucks directors and officers after they refused to reverse the company’s diversity and inclusion policies in response to a letter require them to do so. (Starbucks did not respond to a request for comment for this article, but its directors told the group it was “not in Starbucks best interest to accept the demand and withdraw the policy.”)

Mr Shepard, the man at the center, said more lawsuits were “reasonably likely” if other companies did not comply with demands to rein in their diversity and inclusion policies.

A modest way to do this, said David Lopez, a former general counsel to the Equal Employment Opportunity Commission, is to design policies that are racially neutral but nevertheless promote diversity — such as giving weight to whether a candidate has overcome significant obstacles .

Mr. Lopez noted that Chief Justice John G. Roberts Jr. argued, according to the Supreme Court’s majority view, that a university may consider the effect on a candidate of overcoming racial discrimination as long as the school does not consider the race of the candidate himself.

But dr. Northwestern’s Tillery said making such changes to business diversity programs could be an overreaction to the ruling. While the federal Civil Rights Act of 1964 generally prohibits making individual hiring and promotion decisions explicitly based on race, it allows employers to remove barriers that prevent companies from having a more diverse workforce. Examples include training managers and recruiters to ensure they do not unwittingly discriminate against racial minorities, or advertising jobs on certain campuses to expand the universe of potential applicants.

Ultimately, businesses appear to face a greater threat from lawsuits alleging discrimination against members of minority groups than from lawsuits alleging discrimination against whites. According to the Equal Employment Opportunity Commission, there were about 2,350 charges of the latter form of employment discrimination in 2021, among about 21,000 race-based costs in general.

“There’s an inherent interest in picking your poison,” said Dr. Tillery. Is it a lawsuit from Stephen Miller’s right-wing group that doesn’t live in the real world? Or is it a lawsuit from someone who says you discriminate against your staff and can tweet about how sexist or racist you are?”

He added, “I’ll take the Stephen Miller poison any day.”

J. Edward Moreno reporting contributed. Susan C. Beachy contributed research.