Private Plaintiff Attorneys Step Up in Title VII Disparate Impact Cases

After the White House announced that it would “deprioritize” disparate impact cases, many employers may have mistakenly concluded that disparate impact liability was no longer a concern under Title VII. However, recent litigation activity by the plaintiffs’ bar reaffirms why employers must still evaluate whether neutral rules have a negative impact based on a protected trait if they want to manage employment law risks. 

The Background 

On April 23, 2025, the White House issued Executive Order 14281 entitled, “Restoring Equality of Opportunity and Meritocracy,” announcing the Administration’s policy “to eliminate the use of disparate impact liability in all contexts to the maximum degree possible to avoid violating the Constitution, Federal civil rights laws, and basic American ideals.” 

Disparate impact liability refers to discrimination that results from policies or practices that appear to be neutral, but disproportionately harm people based on legally protected characteristics like sex or race. If the policy or practice has a discriminatory effect, it can be challenged, regardless of whether there is any intent to discriminate. Disparate impact liability was codified into Title VII of the Civil Rights Act in 1991, and has become a cornerstone for most federal, state, and local non-discrimination laws. 

EO 14281 could not – and indeed did not - eliminate disparate impact liability under Title VII. However, the Order did announce enforcement priorities for the new administration, which included that all federal agencies, including the EEOC and the Department of Justice, “deprioritize” enforcement of statutes and regulations imposing disparate impact liability. That makes it highly unlikely that the EEOC, for instance, will take up disparate impact cases on behalf of employees for the foreseeable future. 

However, most employment discrimination cases are handled by the private plaintiffs’ bar, which is not prohibited by EO 14281 from pursuing such cases (nor are federal courts barred from hearing them), and there are plenty of private litigation attorneys ready and willing to pursue these cases.  

What about existing disparate impact cases? 

But what happens to existing charges of discrimination or lawsuits filed by the EEOC that include a disparate impact claim? 

Employees who wish to sue their employer for discrimination under Title VII are required to first file a complaint, or charge of discrimination with the EEOC. If there is reasonable cause to believe the charge states a claim under Title VII, the EEOC can file a lawsuit on behalf of the aggrieved employee or employees. When the agency decides not to file a lawsuit, the employee receives a “Notice of Right to Sue” and can then proceed with a lawsuit on their own.  

Despite EO 14281, employees still have the right to file a charge of discrimination with the EEOC to challenge neutral policies under the disparate impact theory of liability. In fact, employees are still required to do so before filing suit in federal court, and can request a Notice of Right to Sue after 180 days after filing with the EEOC. 

For already-pending EEOC lawsuits with a disparate impact claim, the agency is re-evaluating its involvement. Recent activity in two litigation matters suggests that - while the EEOC may move to dismiss these cases - the agency is notifying impacted employees so they can continue the lawsuits on their own. And the plaintiffs’ bar is stepping in to help. 

This is just what happened in a case filed against a gas station chain claiming its policy of refusing to hire anyone with a criminal history (regardless of the crime) discriminated against Black, Native American, and multiracial job applicants. The EEOC filed suit in 2024 after an eight-year investigation, then moved to dismiss the case citing Executive Order 14281. After the EEOC notified claimants that it would not seek monetary or injunctive relief based on a disparate impact theory due to the new executive order, one of the plaintiffs filed a motion in federal court asking to “intervene” and pursue their own class action lawsuit, effectively taking over the case from the EEOC. For their part, the EEOC has asked the court to delay dismissal of the suit for 60 days to allow potential claimants to intervene. If the motion to intervene is granted (which is likely), the end result will be that the employer will still have to defend its policies and practices in court and can still be found liable under a disparate impact theory of liability. 

Of note, Jenny Yang, who previously served as chair of the EEOC, is now with the law firm Outten & Golden which represents the plaintiff seeking to intervene. In a press release announcing the decision to intervene, Yang  noted “Our client is doing what the law allows – and demands – when government enforcement falls short: workers are stepping in to carry the case forward.”   

The Associated Press has reported that Yang has also said the pullback on federal enforcement of disparate impact risks dissuading companies from proactively examining hiring and other practices to ensure that they do not discriminate. As these cases show, that would be a mistake. The EEOC may be backing away, but private plaintiff attorneys are standing by to step in and fill the void (and potentially recover significant fees for doing so).