For the last year, the Justice Department has been quietly probing high-profile companies over their diversity, equity, and inclusion policies. Deloitte settled one such investigation earlier this week, agreeing to pay $21.5 million to address allegations that the company had violated federal law by taking race and gender into consideration when deciding who to hire and promote.
The government alleged that Deloitte had used “discriminatory race and sex-based employment practices” since 2017, failing to comply with the anti-discrimination measures imposed on federal contractors. “Government contractors cannot reward or penalize employees based on race or sex—and labeling the practice DEI does not make it lawful,” U.S. attorney general Todd Blanche said in a statement.
The Justice Department took issue with Deloitte tracking demographic data and tying diversity goals to executive compensation, and also noted that some of the company’s DEI policies specifically applied to employees who worked on federal contracts.
When reached for comment, a Deloitte spokesperson said, “We are pleased to have resolved this matter to avoid the cost and distraction of protracted litigation, allowing us to remain focused on attracting and developing exceptional talent with the skills and capabilities our clients rely on every day.”
This is just the most recent example of the Trump administration seeking to influence DEI practices at major companies that contract with the government, extracting sizable settlements in the process. In 2025, the Justice Department shared its intention to look into employers who took money from the government, under the aegis of a federal law called the False Claims Act. Through the Civil Rights Fraud Initiative, the agency planned to investigate private sector companies and academic institutions for potential violations of the law that involved DEI policies.
In April, IBM became the first employer to reach a settlement with the Justice Department as part of this initiative, forcing the company to pay $17 million. The allegations were similar to those levied against Deloitte, involving IBM’s use of “diverse interview slates” in the hiring and promotion process and a “diversity modifier” that influenced bonus compensation decisions.
Another investigation that took aim at PayPal’s DEI practices was not brought under the False Claims Act but resulted in a $30 million settlement back in May, targeting an investment program that was meant for Black and minority-owned businesses.
According to a Wall Street Journal report last year, the Justice Department had also opened investigations into Verizon and Google parent company Alphabet, making requests for documents on their workplace programs. (Both companies made significant changes to their DEI programs last year.)
These cases against major employers are in line with Trump’s laser focus on DEI since assuming office, but they also mirror some of the anti-DEI efforts that have taken hold across other parts of the government.
Just last month, the Equal Employment Opportunity Commission voted to eliminate EEO-1 reports, an annual breakdown of demographic data that employers have been legally required to provide for the last 60 years. Since Trump installed EEOC chair Andrea Lucas in early 2025, the agency has mounted a very public campaign to root out what the agency has described as “DEI-related discrimination,” soliciting outreach from white men who have faced discrimination and reportedly prioritizing those cases even when they have limited evidence.
A high-profile EEOC investigation into Nike has put the company under intense scrutiny and, depending on the final outcome, could have serious consequences for corporate DEI.
The Trump administration has continued to find new avenues to attack DEI programs and affirmative action efforts—and it seems companies are willing to cave if it means avoiding a public fight and years of litigation.
