Key Points:
- Florida’s Stop WOKE Act, which restricted workplace DEI training programs, was recently struck down.
- Although legal challenges to DEI initiatives will likely continue, most corporate leaders remain committed to the work.
- Leaders should stay informed on legally sound DEI practices while understanding different levels of DEI initiatives and tracking their business impact.
Florida is just the first of probably many states working to enact legislation to weaponize the Supreme Court of the United States’ (SCOTUS) 2023 decision in the Students for Fair Admissions v. Harvard and Students for Fair Admissions v. the University of North Carolina. Although the decision relates only to higher education admissions, this and similar cases have been used in attempts to hamstring corporate diversity, equity, and inclusion (DEI) initiatives.
Luckily, it’s not working. On March 4, 2024, the U.S. Court of Appeals for the Eleventh Circuit struck down a portion of Florida’s so-called Stop WOKE Act that sought to restrict workplace training on certain DEI concepts. A unanimous panel of judges for the Eleventh Circuit ruled in its decision on Honeyfund.com Inc. v. Governor, State of Florida that Stop WOKE is unconstitutional under the First Amendment of the U.S. Constitution because it sought to restrict content- and viewpoint-based speech.
From the outset, the Individual Freedom Act (IFA), commonly known as the Stop the Wrongs to Our Kids and Employees (Stop WOKE) Act, raised concerns for employers. It specifically restricted training programs that contain anti-harassment, anti-discrimination, and other DEI-related content, including any that address unconscious or implicit bias and systemic racism.
Challenges will continue
While we expect more attempts to derail DEI work at the state level, we don’t expect they’ll hold water. It’s important to address misunderstandings of the law since businesses have a history of changing workplace policies in response to higher-education mandates. It happened in the wake of the 1978 Supreme Court decision in Regents of the University of California v. Bakke, 438 U.S. 265. Although limited in scope to higher-education admissions, the case went on to quietly dissolve race-based quotas in corporate hiring.
This time around, nothing is quiet. The world has changed, and leaders need a way to manage the constant threats to corporate DEI work. Amid the chaos and confusion, they need clarity and an intelligent way to move forward.
DEI work expands
The good news is that although corporate leaders may be deploying initiatives more quietly, they’re not rolling back DEI work. According to a 2024 survey by Littler, a mere 1% of C-suite executives have scaled back their DEI commitments, while 57% have increased their efforts in this domain.
Similarly, in a recent Conference Board survey, no chief human resource officers (CHROs) expressed plans to retract DEI initiatives, with 63% focusing on attracting a more diverse workforce. These statistics underscore the fact that, despite the noise, organizations continue to recognize DEI efforts as integral to business survival and long-range success.
Guidance for leaders
How can leaders continue to expand this important work in the ever-changing, delicate, and highly politicized landscape companies operate in today? It’s no wonder that law firms specializing in consulting on DEI work are booming with new business. Leaders want to know how to prudently continue this work in a way that goes beyond mitigating legal risk. They understand that advancing DEI work in thoughtfully is a core leadership competency that requires strategy and action. Here’s some advice for leaders at any level.
Stay informed about legally sound DEI practices
Luckily, some of the best minds in constitutional law and organizational design are on the case. New York University law professors Kenji Yoshino and David Glasgow have written extensively about DEI workplace issues. They point to three criteria that can put a DEI program in legal hot water: 1) suggesting a preference for certain individuals over others, 2) demonstrating a preference for a legally protected group, and 3) conferring a “palpable benefit” on a specific group, such as an employment opportunity, pay increase, or development perk.
So, for example, efforts to increase job applications from historically underrepresented groups would typically not be a problem, but programs exclusively for hiring these candidates may raise concerns. Evaluating pay parity to meet broader equity goals may not be a problem, but adjusting team compensation based on diversity could be. And requiring certain training for everyone in an organization would not carry legal risks, but offering development opportunities for only a select group could.
Corporate leaders don’t need to be constitutional scholars, but it’s a good idea to regularly review policies and programs and invite open organizational discourse. Due diligence and seeking diverse perspectives as things change are the only ways to keep corporate DEI programs compliant, relevant, always improving, and deeply impactful.
Understand the different levels of DEI work
Through their research and writing, Yoshino and Glasgow have explained the different levels of work essential for meaningful DEI initiatives:
- Debiasing work refers to efforts aimed at reducing unconscious bias in decision-making processes within organizations, such as blind resume reviews, diversity training, diverse hiring panels, and structured interview processes.
- Ambient work involves policy and cohort initiatives aimed at advancing workforce diversity as a whole, including policies and programs to promote diversity in hiring, retention, and promotion practices, as well as fostering an inclusive organizational culture where all employees feel valued and included.
- Universal work refers to policies and practices that benefit every employee and are designed to create a more equitable and supportive work environment for all. Examples include flexible work arrangements, wellness programs, and professional development opportunities.
Together, these three concepts are aimed at creating more inclusive, equitable organizations where diversity is valued, biases are addressed, and all employees have opportunities to thrive.
Protect DEI work by making it good for business
While DEI initially focused on addressing harmful behaviors and ensuring legal compliance, it has grown into a matter of both sound ethics and smart business. To fully realize its potential, companies should track the positive impact of their DEI investments using clear metrics and actionable strategies. This approach, NLI’s Impact Case for DEI, positions diversity as far more than a moral obligation — it’s a key driver of organizational success.
By recognizing diversity as a tool that solves business problems and drives innovation, creativity, and competitiveness, organizations can align DEI initiatives with strategic business goals. This shift in perspective reframes diversity from being a cost center to becoming a clear catalyst of growth and success.
Moving beyond the concept of belonging, the Impact Case for DEI focuses on changing behavior at scale through inclusive habits. By implementing effective training programs that consider cognitive capacity, motivation, and bias, organizations can foster inclusive behaviors and create a culture of belonging.
Because inequity is systemic, equity must be, too. The Impact Case for DEI recognizes the need to address bias and inequity at every level of the organization. This means looking beyond talent systems and institutionalizing equity across all facets of the organization. By treating DEI as a systemic issue, organizations can create lasting change that withstands cultural and social disruptions.
Florida’s legislative actions underscore the ongoing need for leaders to be vigilant. This isn’t simply about staying on the right side of the law. It’s about staying on the right side of history and the right side of what’s best for the business. Leaders who lean into DEI, with both clarity and a growth mindset, will create the workplaces of the future.
