For years, employers sought to remedy racial imbalances in their workforce by recruiting and hiring racial minorities. Diversity, equity, and inclusion (DEI) efforts have only increased since the protests following the killing of George Floyd which defined the summer of 2020.[i] In the summer of 2023, however, the Supreme Court handed down a decision effectively ending affirmative action in college admissions.

Already since the court’s ruling, many litigants have turned their focus toward invalidating employer DEI efforts, relying in part on the Supreme Court’s ruling in Students for Fair Admissions, Inc. v. President & Fellows of Harvard College (SFFA).[ii]     Looking forward, labor and employment attorneys will need to track litigation trends involving DEI measures, as they must remain prepared to advise employer clients on how SFFA may affect the lawfulness of DEI programs.

The Case

SFFA was a consolidation of two cases, one challenging affirmative action at Harvard College and the other challenging affirmative action at the University of North Carolina (UNC).

Harvard’s admission process required consideration of race once an applicant made it to a certain stage of the admissions process.[iii] When Harvard’s admissions committee made its final cuts, the committee considered several non-academic factors, one of which was the applicant’s race. As a result, according to the court, “race is a determinative tip for a significant percentage of all admitted African American and Hispanic applicants.”[iv]

Race played a factor at two stages in UNC’s admissions process. UNC admissions officers were required to consider race and ethnicity as a factor when making their initial recommendations on whether the applicant should be admitted.[v]  Admissions officers could also offer a “plus” for applicants based on their race in determining whether to recommend admission.[vi] After admissions officers’ initial recommendations, a committee reviewed those initial recommendations, and could also consider race in deciding whether to adopt the officers’ recommendation.[vii] 

Plaintiffs claimed such affirmative action programs remained unconstitutional under the Equal Protection Clause of the Fourteenth Amendment.[viii] The court agreed, holding such affirmative action plans could not survive strict scrutiny.[ix]

Before the SFFA decision, colleges and universities could consider an applicant’s race as one factor in determining whether to admit the student. Following the court’s decision, consideration of race in college admissions is generally limited to how an applicant’s race affects other areas of his or her life. For example, the court stated it would remain permissible for a college to consider “an applicant’s discussion of how race affected his or her life [in an admissions essay] be it through discrimination, inspiration, or otherwise.”[x]

Affirmative Action Plans by Private Employers

Unlike public universities like UNC or public sector employers, private employers are not subject to the Equal Protection Clause of the Fourteenth Amendment. However, employers with 15 or more employees are subject to Title VII of the Civil Rights Act of 1964, which   prohibits employers from “fail[ing] or refus[ing] to hire . . . any individual . . . because of such individual’s race, color, religion, sex, or national origin[.]”[xi] Additionally, Section 1981 of the Civil Rights Act of 1866 (§ 1981) provides, “All persons within the jurisdiction of the United States shall have the same right in every State and Territory to make and enforce contracts . . . as is enjoyed by white citizens . . . ”[xii] 

The debate over whether federal laws allow employers to proactively favor minority groups is not new. The United States Supreme Court took up this very question in its 1979 decision in United Steelworkers v. Weber. There, the court held a private employer’s affirmative action plan to hold a certain percentage of positions in a training program open for Black individuals did not violate Title VII. Writing for the majority, Justice William Brennan reasoned Title VII could not be understood to prohibit voluntary employer action to remedy past discrimination because, in passing Title VII, Congress intended to “to cause employers and unions to self-examine and to self-evaluate their employment practices and to endeavor to eliminate, so far as possible, the last vestiges of an unfortunate and ignominious page in this country's history[.]”[xiii] 

Of course, such an allowance is not without parameters. Under prior precedent, an affirmative action plan must be “designed to eliminate manifest racial imbalances in traditionally segregated job categories,” and must not “unnecessarily trammel the interests of” majority employees or require that majority employees be discharged and replaced with minority employees.[xiv] Additionally, the plan must be temporary.[xv]  If an employer’s affirmative action plan meets these marks, the plan constitutes a nondiscriminatory rationale for an employment action under Title VII, overcoming a prima facie showing of a discriminatory employment action.[xvi]

Will the Supreme Court Apply SFFA to Title VII Cases?

It remains too soon to know what effect SFFA will have on employment discrimination cases. Courts developed separate bodies of law for employer affirmative action and college affirmative action, but these bodies of law have generally run parallel with each other and they sometimes overlap.

In Johnson v. Transportation Agency, the court considered whether an employer violated Title VII when it considered an employee’s sex in making promotion decisions to promote females into positions in which females had been underrepresented.[xvii] In finding the employer’s plan did not unnecessarily trample on the rights of male employees, the court noted an applicant’s sex was merely a “plus,” echoing the language of the court’s analysis of college affirmative action plans in Regents of University of California v. Bakke.[xviii] 

Additionally, the Supreme Court has held that cases discussing Fourteenth Amendment principles can provide “helpful guidance” to Title VII cases.[xix] For example, the Supreme Court in Ricci v. DeStefano followed Fourteenth Amendment jurisprudence to conclude an employer can only undertake disparate treatment discriminatory actions to remedy apparent disparate impact discrimination where “the employer can demonstrate a strong basis in evidence that, had it not taken the action, it would have been liable under the disparate-impact statute.”[xx] 

It must also be noted that Justice Gorsuch, joined by Justice Thomas, wrote a concurrence in SFFA, arguing that Harvard and UNC’s affirmative action plans should also be found unlawful under Title VI, the title of the Civil Rights Act prohibiting discrimination in programs receiving federal funding.[xxi] Justice Gorsuch further highlighted the operative language in Title VI is “materially identical” to Title VII’s prohibition on employment discrimination.[xxii] This could very well be seen as a signal of willingness on the part of at least two Justices to apply SFFA’s analysis and conclusion to Title VII cases.

One particular interest group, American Alliance for Equal Rights (AAER), has already filed suits targeting employer DEI initiatives, using the SFFA decision to bolster claims that such initiatives are unlawful.

Following the Supreme Court’s ruling in SFFA, AAER sued two international law firms, Perkins Coie LLP and Morrison & Foester LLP, alleging their 1L fellowship programs open only to members of groups historically underrepresented in the legal profession violated § 1981.[xxiii] The courts were not able to consider SFFA’s effect on private employer’s DEI initiatives, however, as both of these cases have since been dismissed. AAER entered a stipulation of dismissal for both cases when both firms removed the requirement that an applicant be a member in a group historically underrepresented in the legal profession, representing the firms would no longer consider an applicant’s race except as contemplated in SFFA.[xxiv] 

Conclusion

It is unclear at this point what effect SFFA will have on employer DEI efforts. As one federal district court has noted, “[t]he extent to which SFFA overruled the affirmative action plan defense to § 1981 under Johnson, if at all, is unclear.”[xxv]  Labor and employment attorneys will need to keep a close eye on the courts, though, as more lawsuits are likely to follow, asking courts to find that SFFA overrules the Court’s prior decisions in United Steelworkers v. Weber and Johnson v. Transportation Agency. Given the court’s tone in SFFA, especially considering the tone of Justice Gorsuch and Justice Thomas when concurring, employers should also prepare for the real possibility that the Supreme Court could one day soon deem workplace DEI programs unlawful.

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Chris McCarty practices employment and education law as a shareholder in the Knoxville office of Lewis Thomason PC. Chris can be reached at CMcCarty@LewisThomason.com. Ryan Shannon practices employment and education law as an associate in the Knoxville office of Lewis Thomason PC. Ryan can be reached at RShannon@LewisThomason.com.

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[i] Gaudiano, Paolo. “Two Years After George Floyd’s Murder, Is Your DRI Strategy Performative or Sustainable?” Forbes, https://www.forbes.com/sites/paologaudiano/2022/06/27/two-years-after-george-floyd-is-your-dei-strategy-performative-or-sustainable/?sh=76baa526aaa7 (Oct. 11, 2023).

[ii] 143 S. Ct. 2141 (2023); Monnay, Tatyana. “The Lawyer Who Sued Harvard on Affirmative Action Is Going After Law Firms,” BNN Bloomberg, https://www.bnnbloomberg.ca/the-lawyer-who-sued-harvard-on-affirmative-action-is-going-after-law-firms-1.1962268 (Oct. 11, 2023). 

[iii] Id. at 2154.

[iv] Id. at 2155 (internal quotation marks omitted).

[v] Id. 

[vi] Id. 

[vii] Id. at 2156.

[viii] Id. at 2154.

[ix] Id. at 2175.

[x] Id. at 2176.

[xi] 42 U.S.C. § 2000e-2. 

[xii] Id. at § 1981.

[xiii] United Steelworkers v. Weber, 443 U.S. 193, 204 (1979) (internal quotation marks omitted).

[xiv] Johnson v. Transportation Agency, 480 U.S. 616, 628-30 (1987) (citing Weber, 443 U.S. at 204-208). 

[xv] Id.

[xvi] Id. at 626.

[xvii] 480 U.S. 616, 620-21 (1987). 

[xviii] Id. at 640 (citing Regents of University of California v. Bakke 438 U.S. 265 (1978)).

[xix] Ricci v. DeStefano, 557 U.S. 557, 582 (2009). 

[xx] Id. at 563.

[xxi]  SFFA, 143 S.Ct. at 2208 (Gorsuch, J., concurring).

[xxii] Id. at 2216 (Gorsuch, J., concurring). 

[xxiii] (Case 1:23-cv-23189-KMW, Doc. 1 (S.D. Fla. Aug. 22, 2023); Case 3:23-cv-01877-L Doc. 1 (N.D. Tx. Aug. 22, 2023)).

[xxiv] (Case 1:23-cv-23189-KMW, Doc. 39 (S.D. Fla. Oct. 6, 2023); Case 3:23-cv-01877-L Doc. 31 (N.D. Tx. Oct. 11, 2023).

[xxv] Johnson v. Transportation Agency. Am. All. for Equal Rights v. Fearless Fund Mgmt., LLC, 2023 U.S. Dist. LEXIS 172392, *23 (N.D. Ga. Sep. 27, 2023). 

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