On April 23, 2025, President Trump signed an executive order aimed at eliminating enforcement of “disparate impact” discrimination claims, asserting that the disparate impact liability theory—used by courts for over five decades—violates the U.S. Constitution, “by requiring race-oriented policies and practices to rebalance outcomes along racial lines.” The executive order, titled “Restoring Equality of Opportunity and Meritocracy,” broadly addresses federal civil rights laws, including Title VII of the Civil Rights Act, by:
- Revoking certain presidential actions that approve the disparate impact theory of liability.
- Ordering all federal agencies to “deprioritize enforcement of all statutes and regulations” that “impose” disparate impact liability (notably including by its terms “other laws or decisions, including at the State level, that impose disparate impact liability”).
- Directing the U.S. attorney general to repeal or amend Title VI regulations that contemplate disparate impact liability (Title VI of the Civil Rights Act of 1964 protects every person in the U.S. from discrimination based on race, color, or national origin in programs or activities receiving federal financial assistance).
- Requiring the U.S. attorney general and the chair of the EEOC to review all pending investigations and suits under federal civil rights law that rely on a theory of disparate impact liability, and “take appropriate action with respect to such matters consistent with the policy” of the executive order (i.e. ceasing enforcement of a disparate impact claims for liability.
- Instructing the U.S. attorney general and chair of the EEOC to formulate and issue guidance to employers regarding ways to promote equal access to employment.
Notably, the executive order cannot and does not change or supersede state or federal law or Supreme Court precedent and does not affect how individual employees can assert claims against employers. However, the executive order does indicate the federal government’s enforcement priorities in employment cases, at least for the foreseeable future.
What’s Changed
Under the current statutory and common law framework, in addition to direct discrimination claims, employers can be held liable for facially neutral policies that have a discriminatory impact on individuals based on a protected characteristic such as their race or gender. Under such disparate impact theory of liability, courts are asked to consider the effects of a policy—not the intent—and review policies that disproportionately impact protected groups.
For example, if an employer requires a certain level of education to be eligible for a job, and that requirement disproportionately impacts employees in a protected class, then such requirement may be said to have a disparate impact on the affected individuals, even though the employer may not have been motivated to discriminate against any protected class on the basis of race, color, religion, sex, or national origin.
Under the new executive order, President Trump has directed enforcement arms of the executive branch to stop using disparate impact as a basis for pursuing discrimination claims, because, as the executive order argues, disparate impact liability itself contravenes the principles of equality and meritocracy as they relate to ensuring a “colorblind society.”
How the Executive Order Impacts Employers
At least for the next several years of the Trump administration, employers can expect that the EEOC and other federal agencies will quickly terminate all enforcement efforts relating to disparate impact theories of discrimination.
This means that if an employer is currently under investigation or is being sued based on a disparate impact claim, all investigations or prosecution efforts will cease. Additionally, while employees can still bring disparate impact claims under state and federal law, such claims may be more difficult to prove in the face of disappearing and amended rules and regulations (albeit applicable statutes and state and federal case law on point remains untouched by the EO).
Furthermore, employers should be on the lookout for additional guidance from the Office of the Attorney General and the EEOC regarding enforcement activities.