In a significant development related to disparate impact liability, on April 23, 2025, President Trump issued an Executive Order “to eliminate the use of disparate impact liability in all contexts to the maximum degree possible.” The order is titled “Restoring Equality of Opportunity and Meritocracy”, and would eliminate disparate impact liability, which is a legal theory codified in Title VII of the Civil Rights Act of 1964 that requires federal agencies, such as the Equal Employment Opportunity Commission (EEOC) to prohibit employer practices that have a discriminatory impact on protected groups, even when there is no intent to discriminate. The Order states as its purpose, the following:

“A bedrock principle of the United States is that all citizens are treated equally under the law.  This principle guarantees equality of opportunity, not equal outcomes.  It promises that people are treated as individuals, not components of a particular race or group.  It encourages meritocracy and a colorblind society, not race- or sex-based favoritism.  Adherence to this principle is essential to creating opportunity, encouraging achievement, and sustaining the American Dream.

But a pernicious movement endangers this foundational principle, seeking to transform America’s promise of equal opportunity into a divisive pursuit of results preordained by irrelevant immutable characteristics, regardless of individual strengths, effort, or achievement.  

A key tool of this movement is disparate-impact liability, which holds that a near insurmountable presumption of unlawful discrimination exists where there are any differences in outcomes in certain circumstances among different races, sexes, or similar groups, even if there is no facially discriminatory policy or practice or discriminatory intent involved, and even if everyone has an equal opportunity to succeed.  Disparate-impact liability all but requires individuals and businesses to consider race and engage in racial balancing to avoid potentially crippling legal liability.  It not only undermines our national values, but also runs contrary to equal protection under the law and, therefore, violates our Constitution.  
On a practical level, disparate-impact liability has hindered businesses from making hiring and other employment decisions based on merit and skill, their needs, or the needs of their customers because of the specter that such a process might lead to disparate outcomes, and thus disparate-impact lawsuits.  This has made it difficult, and in some cases impossible, for employers to use bona fide job-oriented evaluations when recruiting, which prevents job seekers from being paired with jobs to which their skills are most suited — in other words, it deprives them of opportunities for success.  Because of disparate-impact liability, employers cannot act in the best interests of the job applicant, the employer, and the American public. 
Disparate-impact liability imperils the effectiveness of civil rights laws by mandating, rather than proscribing, discrimination.  As the Supreme Court put it, “[t]he way to stop discrimination on the basis of race is to stop discriminating on the basis of race.”
Disparate-impact liability is wholly inconsistent with the Constitution and threatens the commitment to merit and equality of opportunity that forms the foundation of the American Dream.  Under my Administration, citizens will be treated equally before the law and as individuals, not consigned to a certain fate based on their immutable characteristics.”

Although at this time, since the law has not yet changed, U.S. courts will likely still apply the disparate impact theory of liability in employment discrimination claims, it is expected that federal agencies, such as the EEOC, will stop with their enforcement of disparate impact claims. Employers should consult with their legal counsel on the impact of the Executive Order on any pending disparate impact cases.