Katherine Pappas discussed the recent Department of Justice (DOJ) guidance clarifying how the administration will apply federal antidiscrimination laws to recipients of federal funding. The guidance provides examples of policies and practices, including diversity, equity, and inclusion (DEI) policies, that DOJ considers illegal, as well as "nonbinding suggestions" for organizations to "minimize the risk of violations." One potentially unlawful practice highlighted in the guidance is described as "proxy" discrimination — the use of "ostensibly neutral criteria that function as proxies for protected characteristics." "While I would say it was previously established that this administration would take the position that quotas and selection criteria that were explicitly based on protected characteristics were unlawful, this guidance goes a little further [by] making clear that the DOJ is going to consider whether facially neutral criteria is being used as a proxy for protected characteristics," Pappas said. "Then turning to the best practices section of the memo, it kind of doubles down on that scrutiny of neutral criteria, suggesting that companies discontinue programs or policies designed to achieve discriminatory outcomes even if they use facially neutral means."

The guidance also calls attention to the use of so-called diverse slates — pools of job applicants or interview candidates that deliberately include people of diverse backgrounds. Pappas said employers "are going to have to take a close look at whatever kind of hiring practice they have, whether it's diverse slate[s] or other hiring practices" listed in the DOJ's guidance document to make a determination as to whether those practices should be maintained in any form.