At the end of June 2023, the Supreme Court of the United States (SCOTUS), in a 6-3 ruling, ended affirmative action, a set of procedures deployed by colleges and universities to eliminate unlawful discrimination among applicants from underrepresented groups. The purpose of affirmative action was to help people overcome present-day challenges brought about because of past practices and to remove barriers to opportunities, so everyone had a fair chance at succeeding. Many experts in college admissions and employment law have described affirmative action as a "leveling of the playing field."
Now, in this ruling, the Supreme Court has said that institutions of higher learning can no longer consider race among the factors in admissions. The question becomes, "What will this mean for HR and the workforce?"
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Why Should Human Resources Care?
"On its face, SCOTUS' decision to end affirmative action in higher eduction isn't an employment decision. But it's potential - and, I believe, likely - impact on the workplace will be significant," says Jon Hyman, Shareholder and Employment & Labor Practice Chair at Wickens Herzer Panza. "Those who oppose DEI efforts, or worse position them as evidence of 'evil wokeness,' will use the decision to argue that we don't need DEI programs or policies in the workplace anymore. If 'systemic discrimination' is over, they argue, then we don't need workplace programs that discriminate against White people. Secondly, opponents of affirmative action will target the OFCCP [Office of Federal Contract Compliance Programs] and affirmative action in federal contracts and subcontracts as unconstitutional. The fact that some will use the affirmative action case to make these arguments, however, shows just how far we still need to go."
Hyman's conclusion about OFCCP is one that HR Thought Leader and Co-Author of the Big Book of HR and many other titles, Cornelia Gamlem, has made, too. When she worked for a large IT company that had government contracts, she was required by law to devise an annual affirmative action plan. OFCCP is part of the Department of Labor (DOL) and is responsible for ensuring companies with government contracts are abiding by laws meant to protect people from discrimination at work. DOL regularly audits companies working with the federal government.
Gamlem reminds HR professionals that compliance is about more than race, which is what SCOTUS narrowly addressed in its decision. The OFCCP is "responsible for complying with the legal requirement to take affirmative action and not discriminate on the basis of race, color, sex, sexual orientation, gender identity, religion, national origin, disability, or status as a protected veteran. In addition, contractors and subcontractors are prohibited from discharging or otherwise discriminating against applicants or employees who inquire about, discuss or disclose their compensation or that of others, subject to certain limitations," according to the government's website.
In addition, Gamlem says she is confident that Human Resources at most companies will continue to pursue diversity, equity, inclusion, and belonging goals despite the ruling.
"Regardless of what box you want to put people in, if there's an environment where certain groups are feeling threatened or excluded - that's how we kind of morphed from diversity into inclusion - they're going to leave, and organizations are going to say, 'Wait a minute. We can't afford that turnover,'" says Gamlem. "It gets back to a very practical business issue. What we want to do is some training. We want to sensitize people around respecting differences. If you do a good job with diversity training, then that's going to be the message that people walk away with. It's all about respect."
Coming for Diversity Efforts in the Workplace
However, already 13 GOP attorneys general wrote a letter to Fortune 100 companies to reexamine their diversity policies in light of the Supreme Court ruling, according to the Washington Post. They argue that by trying to hire a diverse team, Human Resources is setting "racially discriminatory quotas and preferences," which are therefore illegal.
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For now, the Equal Employment Oppourtunity Commission, the federal agency that enforces workplace civil rights, still stands as does Title VII, which is part of the 1964 Civil Rights Act and makes it illegal for an employer to discriminate against someone because of race or gender and actually provides protection for employers trying to create equity and equal representation for all, say legal experts. But there's no question that some politicians are trying to turn the law on its head and use it against organizations.
Employers are pushing back and recognizing the impact of diversity practices on the bottom line and the ability of their organization to succeed in an increasingly competitive world.
"Employers need to recognize that, if they want to remain competitive in today’s market, creating an environment where all employees feel respected and valued is essential. It is also important for organizations to understand that diversity isn't just about race or ethnicity; it is about creating an environment where people from all backgrounds can succeed," says Martin Seeley, CEO of Mattress Next Day. "Through engaging in meaningful dialogue, developing inclusive policies and practices, and actively seeking out talent from different backgrounds, organizations will be able to ensure that their workforce and leadership of tomorrow are truly diverse."
The Data on Diversity at Work
Still, even those companies without government contracts may face challenges to their diversity, equity, inclusion, and belonging (DEIB) programs and goals. After all, the Supreme Court decision will inevitably impact talent pipelines.
"This decision raises worries about potential setbacks in creating a diverse workforce and leadership within our industry (tech). From an HR standpoint, maintaining a diverse and inclusive workplace will pose challenges without affirmative action's support," says Chris Stott, Director of Seven Marketing. "The policy has been instrumental in promoting equal opportunities, leveling the playing field, and addressing historical inequalities. Consequently, HR leaders will need to proactively implement robust diversity, equity, and inclusion (DEI) initiatives to bridge the gap. Moreover, the decision could impact the tech industry's talent pipeline, potentially leading to greater barriers for underrepresented candidates in terms of entry and advancement."
In the wake of the decision, the Washington Post assessed the damage done when different states banned affirmative action ahead of the ruling. In states where affirmative action was banned and race could not be a factor in admissions decisions, White and Asian students benefited, while Blacks, Native Americans, Hispanics, and multiracial people become even less represented. That means fewer of them become part of alumni networks, fewer of them go through recruiting for internships and jobs, and fewer of them end up as knowledge workers and then in leadership roles in business.
Black and Indigenous People and other people of color make up only about 17% of the C-suite, according to Gartner. Men still hold most of the CEO jobs, although women have made progress.
"I think the pipeline is beginning to change. It has improved dramatically for women: Our research found, for example, that women are now 27% of top executives, up from zero in 1980 and 12% in 2001," says Peter Cappelli, the George W. Taylor Professor of Management at The Wharton School at University of Pennsylvania and Director of Wharton's Center for Human Resources. "The issue is more as to the pace of change and whether employers will push to improve diversity more at the top, faster than changes in the pipeline alone would suggest."
Employers and HR Take Action
Companies are already thinking about their next move and what they can do to keep making progress on these fronts.
"The talent pipeline for diverse candidates could be affected, necessitating HR's efforts to foster relationships with underrepresented communities and educational institutions," says Anthony Bautista, Founder/CEO at Pure CBD Now. "Despite the decision, HR leaders have the opportunity to drive meaningful change by implementing strong DEI initiatives and showcasing the business benefits of diversity. Proactive efforts can lead to a more diverse and inclusive workforce and leadership for the future."
At least one employer, Richard Nolan, Chief People Officer at Epos Now, shared concern about the tension that affirmative action can spark among colleagues because some people mistakenly believe that these admissions and hiring decisions are based solely on race or classification in a protected group, rather than their qualifications and achievements.
"To strike an optimal and harmonious balance, Epos Now actively prioritizes the promotion of diversity, while remaining steadfast in our commitment to merit-based principles," says Nolan. "We conscientiously foster an inclusive environment where each individual feels genuinely valued and is offered equal opportunities for growth and advancement. Continuously evaluating the consequences of our affirmative action decisions ensures that we consistently uphold a fair, inclusive, and high-performing work culture that benefits both our esteemed employees and the organization as a whole."
The Future of DEIB
Ultimately, businesspeople are driven by results. Study after study has shown that DEIB policies and a diverse team that brings together people with different perspectives results in positive business outcomes. There's more innovation, creativity, and success. These groups tend to create products and services that have appeal to a broader customer base, and they can achieve great things when given the resources.
Of course, many HR leaders also recognize that creating a fair and just system of hiring and promotion is the right thing to do. Morals still matter.
"Probably, we're in for some bumpy times. I think it's a good time to be talking about diversity for people who really understand what it is to be educating others...Leadership really needs to understand what diversity is to push it forward. A lot of this rhetoric makes absolutely no sense. But it's going to take a lot of work," says Gamlem. "It took us a lot of work to get here, if you start to read about the history of the passage of Title VII. It didn't just happen...Putting a lot of the political noise aside, I think, many companies - I'd like to say most companies - in this day and age, recognize the importance of having a diverse workplace and having people who come from different backgrounds and bring different points of view."