Like almost every federal agency, things have certainly changed at the Equal Employment Opportunity Commission (EEOC) in the last 10 months. One of those significant changes has been the departure from investigation of claims asserting the “disparate impact” theory. A plaintiff in a disparate impact case, generally speaking, must show that a seemingly neutral policy causes disproportionately negative and unjustified harm to a protected class (like race or sex). At least one former claimant is now suing the EEOC for dropping its investigation into her charge of disparate impact discrimination, alleging that the EEOC violated its statutory obligations in Cross v. U.S. EEOC (No. 1:25-cv-03702 in D.D.C.).
EEOC’s Procedure and History on Disparate Impact
As we know, the EEOC enforces federal discrimination laws like Title VII and the Age Discrimination in Employment Act (ADEA). A charging party files a charge and the EEOC investigates. During the investigation, the EEOC is looking for evidence that a charging party has been discriminated against, either because of disparate treatment (intentional discrimination) or disparate impact. After the investigation, the EEOC can take one of two steps: (1) It can decide “that there is not reasonable cause to believe the charge is true” and dismiss the charge [42 U.S.C. § 2000e-5(b)] or (2) it can decide “that there is reasonable cause to believe that the charge is true,” in which case it “shall endeavor to eliminate any such alleged unlawful employment practice by informal methods of conference, conciliation, and persuasion.” If those efforts at conciliation fail, the EEOC can file a lawsuit on behalf of the claimant (§ 2000e-5(f)(1)).
According to the lawsuit, disparate impact claims are an “important tool that workers can use to hold employers accountable when they adopt unjustified policies or practices that disadvantage a particular group but where there is insufficient evidence to prove intentional discrimination.” The EEOC has had a long history of recognizing disparate-impact liability under the ADEA, going back to 1981, followed by codification in the Civil Rights Act of 1991. According to the plaintiff, the “EEOC has consistently recognized disparate-impact discrimination as a cognizable theory of discrimination in both its law enforcement and advisory roles.”
Executive Order and September Memo Shutting Down Disparate Impact Claims
On April 28, 2025, President Trump issued Executive Order 14281, “Restoring Equality of Opportunity and Meritocracy” [90 Fed. Reg. 17,537] that criticized the concept of disparate-impact liability as divisive and instructed agencies to “deprioritize enforcement of all statutes and regulations to the extent they include disparate-impact liability.” It also directed the chair of the EEOC to assess “all pending investigations, civil suits, or positions taken in ongoing matters under every Federal civil rights law . . . that rely on a theory of disparate-impact liability” and to “take appropriate action with respect to such matters consistent with the policy” of the executive order.
Then, on September 15, 2025, the EEOC issued the Disparate Impact Rule that directed the end of EEOC investigations of disparate-impact charges by September 30 and “every pending charge of discrimination premised solely on disparate impact liability [was to] be administratively closed by issuing a Notice of Right to Sue and identifying ‘other’ as the reason for the closure,” unless a no cause finding could be determined by October 31, 2025. The rule further set out that it was the policy of Executive Order 14281 “to eliminate the use of disparate-impact liability in all contexts to the maximum degree possible” and to “deprioritize enforcement of all statutes and regulations to the extent they include disparate- impact liability, including but not limited to 42 U.S.C. 2000e-2.” The EEOC would not be “commencing, developing, or continuing to pursue litigation advancing disparate impact causes of action.”
Claims Against EEOC’s Action
Leah Cross, an Amazon driver, filed a charge of discrimination in May 2023 alleging that she had been discriminated against because of her sex. Specifically, Cross alleged that Amazon’s strict delivery quotas made it difficult or impossible for drivers to use the bathroom during their shifts and that policy had a disparate impact on female drivers.
The EEOC interviewed her in January 2025. But based on the executive order and Disparate Impact Rule guidance, the EEOC issued a dismissal and right to sue to Cross on September 29, 2025. Cross’ lawsuit brings multiple claims for violation of the Administrative Procedures Act, including that the EEOC’s actions with regard to the Disparate Impact Rule violated its statutory requirements, was arbitrary and capricious, exceeded its statutory jurisdiction, and violated procedural requirements as it engaged in rulemaking without a quorum of three commissioners.
Takeaways
The Disparate Impact Rule will not prevent plaintiffs from pleading a disparate impact claim; it only means that the EEOC will not investigate or pursue such claims. The EEOC will simply issue a right to sue letter and be done.
The challenge to the EEOC’s position will be significant to watch and will certainly impact the EEOC’s actions and investigations going forward for any charges that may relate to disparate impact theory. Stay tuned to developments in this case.