The Trump Administration has escalated its attacks on diversity, equality, and inclusion (DEI) initiatives, targeting 20 major law firms, including prominent London-based practices. Among those affected are A&O Shearman, Freshfields Bruckhaus Deringer, and Hogan Lovells, which now find themselves in the crosshairs of sweeping federal scrutiny.
This comes amidst the crackdown on corporate DEI announced by Attorney General Pam Bondi, who has instructed the Justice Department to examine a series of measures to crackdown on diversity, equality and inclusion programmes in corporations. This comes alongside the federal government’s unravelling of publicly funded DEI operations.
This new direction is set against the backdrop of the US Supreme Court’s 2023 decision in Students for Fair Admissions v. Harvard, which has dramatically reshaped the legal landscape for affirmative action in higher education. The DoJ is interpreting this decision far more broadly, potentially going after any company which uses race or sex in hiring, alongside broader DEI initiatives. Now, the Trump Administration is setting its sights on law firms, too.
Anti-DEI executive orders
The Administration’s approach to curbing DEI has extended beyond rhetoric to concrete action. Firms like Perkins Coie and Paul Weiss have already faced direct consequences. Perkins Coie, known for representing Hillary Clinton’s 2016 campaign, was isolated from federal contracts by an executive order. Paul Weiss faced similar treatment, with President Trump alleging that one of its partners participated in politically motivated prosecutions linked to the January 6 riot.
With this EO, the Administration has moved to sever financial ties between the federal government and firms engaging in pro bono DEI-related work. This reflects a broader attempt to dismantle pro-DEI corporate policies that the Administration perceives as discriminatory.
The fine legal line of DEI
For companies operating in the United States, the situation presents a delicate balancing act. On one hand, the landmark Supreme Court ruling in Students for Fair Admissions v. Harvard clearly prohibits admissions policies that explicitly consider race and sex. On the other, federal courts have repeatedly reaffirmed that private employers possess a First Amendment right to advocate for DEI initiatives. Recent judicial opinions have warned against overreaching interpretations that could be construed as a violation of free speech and the right to association.
This legal tightrope demands that companies closely monitor and adjust their DEI programmes. The policies of the Trump administration, as evidenced by Bondi’s memos, suggest a marked shift towards a narrower reading of civil rights laws. Companies are therefore advised to review their diversity and inclusion strategies to ensure they do not inadvertently contravene these emerging interpretations. Failure to do so might expose them to federal scrutiny and potential litigation by the Justice Department.
EEOC investigation into DEI practices
The US Equal Employment Opportunity Commission (EEOC) has reinforced this stance by launching an expansive inquiry into DEI policies at top law firms. Letters sent to 20 firms demand detailed information on hiring, compensation, and client diversity requirements.
The scope of these investigations suggests that DEI programs could be challenged under Title VII of the Civil Rights Act of 1964, which prohibits discrimination based on race, sex, or other protected characteristics. The demand for client demographic data further signals an effort to scrutinise how law firms align their staffing with diversity policies.
The law firms receiving the letters are: Debevoise & Plimpton, Cooley, Goodwin Procter, Kirkland & Ellis, Latham & Watkins, McDermott Will & Emery, Milbank, Morgan Lewis & Bockius, Morrison & Foerster, Perkins Coie, Reed Smith, Ropes & Gray, Sidley Austin, Simpson Thacher & Bartlett, Skadden, White & Case, and WilmerHale.
Is the DEI crackdown spreading to the UK?
While the crackdown on DEI initiatives unfolds in the United States, the implications for international businesses remain uncertain. In the UK, the Financial Conduct Authority (FCA) has already abandoned its DEI plans for the financial sector, partly in response to transatlantic tensions.
Furthermore, ongoing trade disputes and regulatory divergences between the US, UK, and EU complicate the compliance landscape. The Trump administration’s actions against DEI could signal further legal and economic friction, especially as European regulators continue to prioritise corporate accountability and inclusion.
DEI compliance checklist: Keeping your law firm on the right side of the DEI crackdown
Review applicable legislation and case law
Familiarise yourself with the relevant federal and state laws on discrimination and affirmative action. Understand key judicial decisions, such as Students for Fair Admissions v. Harvard, to understand the legal limits on race- and sex-conscious policies.
Engage specialist legal advice
Consult with legal experts experienced in employment law, civil rights, and constitutional matters. Seek regular legal updates to stay informed of evolving interpretations, especially given recent actions by the US Department of Justice.
Audit existing DEI initiatives
Undertake a comprehensive review of all current DEI programmes and policies. Identify any elements that may be construed as providing explicit or implicit preferences based on race, sex, or other protected characteristics.
Ensure policies are voluntary and transparent
Confirm that participation in DEI initiatives is voluntary rather than mandatory. Clearly articulate the purpose, goals, and expected outcomes of each programme, ensuring that they are aligned with broader business objectives and merit-based practices.
Maintain a neutral and inclusive approach
Avoid policies that could be interpreted as imposing quotas or fixed diversity targets. Focus on creating inclusive environments and fostering equal opportunity through training, mentorship, and unbiased recruitment processes.
Document rationale and processes
Keep detailed records that explain the business case and legal rationale behind each DEI initiative. Document all internal reviews, consultations, and any adjustments made in response to legal advice or policy updates.
Train leadership and staff
Provide regular training for HR personnel and managers on the legal boundaries of DEI initiatives. Ensure that staff understand both the importance of diversity and the legal requirements that must be met to avoid discrimination claims.
Implement internal compliance measures
Establish regular internal audits or reviews of DEI practices to ensure ongoing compliance. Set up a dedicated compliance team or officer to monitor changes in law and policy, and to oversee necessary adjustments.
Communicate clearly with employees
Ensure that all internal communications about DEI policies highlight the voluntary and supportive nature of these initiatives. Reinforce that the organisation’s commitment to diversity does not contravene constitutional rights, such as free speech and association.
Monitor policy changes at the federal level
Keep abreast of new memos, orders, or directives from the Department of Justice and other regulatory bodies. Adjust DEI programmes as necessary in response to evolving guidance, particularly any changes associated with administrations known to scrutinise DEI practices closely.
