DOJ Memo Defines Federal Stance On Unlawful Discrimination

The Department of Justice (DOJ) recently issued a memorandum for all federal agencies and recipients of federal funding urging them to follow federal antidiscrimination law, emphasizing that the agency will consider programs supporting diversity, equity and inclusion (DEI) as discriminatory.

The July 29 memorandum clarifies how the federal government will apply antidiscrimination laws and provides nonbinding best practices “to assist entities in avoiding legal pitfalls and upholding equal opportunity for all. Entities that receive federal financial assistance or that are otherwise subject to federal antidiscrimination laws, including educational institutions, state and local governments, and public and private employers, should review this guidance carefully to ensure all programs comply with their legal obligations.”

The tone of the memorandum is similar to a “Follow the Law” letter issued by the Department of Transportation in April (see “Letter Demands DOT Recipients Follow Federal Laws,” June 2025) and a Dear Colleague letter issued by the Department of Education in February (see “ED Letter Affirms Stance on Racial Preferences,” April 2025).

The memorandum states that entities receiving federal funds, like all other entities subject to federal antidiscrimination laws, must ensure that their programs and activities comply with federal law and do not discriminate on the basis of race, color, national origin, sex, religion or other protected characteristics “no matter the program’s labels, objectives or intentions.”

Key points that DOJ addressed in the memorandum include:

• Prohibition on protected characteristics as criteria: Using race, sex or other protected characteristics for employment, program participation, resource allocation, or other similar activities, opportunities or benefits, is unlawful, except in rare cases where such discrimination satisfies the relevant level of judicial scrutiny.
• Importance of sex-separated intimate spaces and athletic competitions: Compelling employees to share intimate spaces with the opposite sex or allowing men to compete in women’s athletic competitions would typically be unlawful.
• Unlawful proxy discrimination: Facially neutral criteria (e.g., “cultural competence,” “lived experience,” geographic targeting) that function as proxies for protected characteristics violate federal law if designed or applied with the intention of advantaging or disadvantaging individuals based on protected characteristics.
• Scrutiny of third-party funding: Recipients of federal funds should ensure federal funds do not support third-party programs that discriminate.
• Protection against retaliation: Individuals who object to or refuse to participate in discriminatory programs, trainings or policies are protected from adverse actions like termination or exclusion based on that individual’s opposition to those practices.

The memorandum states that entities receiving federal funds must comply with applicable civil rights laws, including Title VI of the Civil Rights Act of 1964 (see ¶511 in the Federal Grants Management Module); Title VII of the Civil Rights Act of 1964; Title IX of the Education Amendments of 1972 (see ¶531 in the Module) and the Equal Protection Clause of the 14th Amendment. It also adds that the U.S. Supreme Court has consistently held that policies or practices based upon protected characteristics are subject to rigorous judicial scrutiny, particularly alluding to the Supreme Court’s decision in Students for Fair Admissions v. Harvard, 600 U.S. 181 (2023), which stated that the “clear and central purpose of the 14th amendment [to the U.S. Constitution] was to eliminate all official state sources of invidious racial discrimination in the states.” “Race-based classifications are subject to strict scrutiny, requiring a compelling governmental interest and narrowly tailored means to achieve that interest,” DOJ adds in the memorandum.

Among some of the “best practices” for agencies and recipients as listed in the memorandum are:

• Ensure inclusive access: All workplace programs, activities and resources should be open to all qualified individuals, regardless of race, sex or other protected characteristics. Avoid organizing groups or sessions that exclude participants based on protected traits. Some sex separation is necessary where biological differences implicate privacy, safety or athletic opportunity.
• Focus on skills and qualifications: Base selection decisions on specific, measurable skills and qualifications directly related to job performance or program participation. For example, rather than asking about “cultural competence,” assess specific skills such as language proficiency or relevant educational credentials. Criteria like socioeconomic status, first-generation status or geographic diversity must not be used if selected to prioritize individuals based on racial, sex-based or other protected characteristics.
• Prohibit demographic-driven criteria: Discontinue any program or policy designed to achieve discriminatory outcomes. The intent to influence demographic representation risks violating federal law. For example, a scholarship program must not target “underserved geographic areas” or “first-generation students” if the criteria are chosen to increase participation by specific racial or sex-based groups. Instead, use universally applicable criteria, such as academic merit or financial hardship, applied without regard to protected characteristics or demographic goals.
• Document legitimate rationales: If using criteria in hiring, promotions or selecting contracts that might correlate with protected characteristics, document clear, legitimate rationales unrelated to race, sex or other protected characteristics. Ensure these rationales are consistently applied and are demonstrably related to legitimate, nondiscriminatory institutional objectives.
• Scrutinize neutral criteria for proxy effects: Before implementing facially neutral criteria, rigorously evaluate and document whether they are proxies for race, sex or other protected characteristics. For instance, a program targeting “low-income students” must be applied uniformly without targeting areas or populations to achieve racial or sex-based outcomes.
• Eliminate diversity quotas: Focus solely on nondiscriminatory performance metrics, such as program participation rates or academic outcomes, without reference to race, sex or other protected traits. Discontinue policies that mandate representation of specific racial, sex-based or other protected groups in candidate pools, hiring panels or final selections. For example, replace a policy requiring “at least one minority candidate per slate” with a process that evaluates all applicants based on merit.
• Avoid exclusionary training programs: Ensure trainings are open to all qualified participants, regardless of protected characteristics. Avoid segregating participants into groups based on race, sex or other protected characteristics. Trainings should not require participants to affirm specific ideological positions or confess to personal biases or privileges based on a protected characteristic.
• Include nondiscrimination clauses in contracts to third parties and monitor compliance: Incorporate explicit nondiscrimination clauses in grant agreements, contracts or partnership agreements, requiring third parties to comply with federal law, and specify that federal funds cannot be used for programs that discriminate based on protected characteristics. Monitor third parties that receive federal funds to ensure ongoing compliance, including reviewing program materials, participant feedback and outcomes to identify potential discriminatory practices. Terminate funding for noncompliant programs.
• Establish clear anti-retaliation procedures and create safe reporting mechanisms: Implement and communicate policies that prohibit retaliation against individuals who engage in protected activities, such as raising concerns, filing complaints or refusing to participate in potentially discriminatory programs. Include these policies in employee handbooks, student codes of conduct and program guidelines. Provide confidential, accessible channels for individuals to report concerns about unlawful practices.

For More Information

The DOJ memorandum is available at https://tinyurl.com/2zu7za9y.