EEOC Rescinds Forty-Year-Old Affirmative Action Guidance: Why Employers Should Review Their DEI and Employment Practices Now

On June 30, 2026, the U.S. Equal Employment Opportunity Commission (“EEOC”) voted to rescind two longstanding guidance documents that, for more than four decades, provided employers with a roadmap for implementing voluntary affirmative action programs under Title VII of the Civil Rights Act of 1964. The Commission withdrew its 1979 interpretive guidance entitled Affirmative Action Appropriate Under Title VII of the Civil Rights Act of 1964 and the related Section 607 of the EEOC Compliance Manual. According to EEOC Chair Andrea Lucas, the agency concluded that the guidance no longer reflects the text of Title VII or current Supreme Court precedent. Although the EEOC’s action does not amend Title VII or eliminate all affirmative action programs, it represents another significant step in the federal government’s continuing shift toward a color-blind interpretation of federal employment discrimination laws. For employers, this is an appropriate time to conduct a privileged review of hiring, promotion, compensation, and diversity initiatives.

The EEOC’s Position

When the original guidance was adopted in 1979, the EEOC encouraged employers to voluntarily implement narrowly tailored affirmative action plans designed to remedy identifiable barriers affecting women and minorities. The Commission has now determined that portions of that guidance are inconsistent with the Supreme Court’s modern interpretation of Title VII, which protects every individual from discrimination because of race, sex, religion, national origin, or other protected characteristics. The rescission itself does not prohibit employers from pursuing workplace diversity or expanding recruiting efforts. Rather, it reflects the EEOC’s position that employment decisions should not be based upon an applicant’s or employee’s protected characteristics unless specifically authorized by law.

Part of a Larger Trend

The EEOC’s action did not occur in a vacuum. Over the past several years, the Supreme Court has steadily emphasized that anti-discrimination laws protect individuals, not groups. In 2023, the Supreme Court’s decision in Students for Fair Admissions v. President and Fellows of Harvard College significantly limited the use of race-conscious admissions policies in higher education. Although that case addressed educational institutions rather than employers, many employers reevaluated their DEI initiatives in light of the Court’s reasoning regarding equal treatment. More recently, in Ames v. Ohio Department of Youth Services, the Supreme Court unanimously held that so-called “reverse discrimination” plaintiffs are not subject to a heightened evidentiary standard under Title VII. The Court reaffirmed that Title VII protects every employee equally, regardless of whether the employee belongs to a majority or minority group. Taken together, these developments strongly suggest that federal courts, and now the EEOC, will closely scrutinize employment practices that expressly consider race or sex when making employment decisions.

What This Means for Employers

Many employers implemented DEI initiatives in response to evolving workplace expectations and societal demands. Most were designed with laudable objectives and remain entirely lawful. However, employers should distinguish between initiatives that promote equal opportunity and initiatives that provide employment preferences based upon protected characteristics.

Programs that merit careful review include:

• Hiring preferences tied to race or sex;
• Promotion programs limited to particular demographic groups;
• Leadership development programs restricted by protected classifications;
• Internship or fellowship opportunities available only to certain races or genders;
• Diversity quotas or numerical hiring targets;
• Compensation or bonus programs tied to demographic outcomes; and
• Selection criteria that expressly consider race or sex in employment decisions.

By contrast, employers generally may continue to:

• Recruit broadly to expand applicant pools;
• Conduct outreach to historically underrepresented communities;
• Remove unnecessary barriers to employment;
• Provide mentorship opportunities that are open to all employees;
• Offer equal access to professional development; and
• Foster an inclusive workplace through lawful training and education.

The distinction is increasingly becoming whether an employer is expanding opportunity for everyone or making employment decisions because of an individual’s protected characteristics.

Considerations for New Jersey Employers

New Jersey employers should recognize that this federal development does not change their obligations under the New Jersey Law Against Discrimination (“NJLAD”), one of the nation’s broadest anti-discrimination laws. The NJLAD continues to prohibit discrimination and harassment based upon numerous protected characteristics, including race, sex, age, disability, sexual orientation, gender identity, religion, national origin, pregnancy, military service, and other protected classifications. Likewise, employers remain subject to other state and federal obligations, including reasonable accommodation requirements and equal pay laws. Nevertheless, because many discrimination claims are brought under both Title VII and the NJLAD, New Jersey employers should expect plaintiffs’ attorneys to rely upon recent federal developments when challenging DEI initiatives or employment decisions involving protected characteristics. Accordingly, employers should ensure that employment decisions are well documented, supported by legitimate business reasons, and based upon objective qualifications rather than demographic considerations.

Practical Steps Employers Should Take

In light of the EEOC’s announcement, employers should consider conducting a comprehensive review of their employment practices with counsel. Areas for review include:

• DEI policies and strategic initiatives;
• Hiring and recruiting procedures;
• Promotion and succession planning;
• Leadership development programs;
• Internship and fellowship opportunities;
• Compensation and incentive plans;
• Employee resource group policies;
• Performance evaluation systems;
• Job descriptions and qualification standards; and
• Human resources training materials.

The review should focus on whether any employment decision expressly relies upon protected characteristics and whether policies remain consistent with current federal and state law. Whenever possible, employers should document that employment decisions are based upon objective qualifications, demonstrated performance, business needs, and legitimate, nondiscriminatory factors.

Looking Ahead

The EEOC’s rescission is unlikely to be the final word. Employers should anticipate increased investigations, additional litigation challenging DEI initiatives, and continued judicial refinement of the legal standards governing affirmative action and workplace diversity programs. Organizations need not abandon their commitment to diversity, inclusion, or equal opportunity. Rather, they should ensure that those initiatives are structured in a manner consistent with today’s legal landscape. A proactive legal review today may significantly reduce the risk of costly litigation tomorrow.