This article contains a correction.
Authors’ note: The disability community is rapidly evolving to use identity-first language in place of person-first language. This is because it views disability as being a core component of identity, much like race and gender. Some members of the community, such as people with intellectual and developmental disabilities, prefer person-first language. In this column, the terms are used interchangeably.
On April 23, 2025, President Donald Trump signed an executive order (EO) titled “Restoring Equality of Opportunity and Meritocracy,” which targets disparate impact liability, a vital source of legal protection for victims of discrimination. “Disparate impact” is a legal term that describes the consequences of policies and actions that appear neutral but disproportionately affect a protected group of people and often perpetuate historical discrimination. The EO tells the Department of Justice’s (DOJ) attorney general, the secretary of the Department of Housing and Urban Development (HUD), the director of the Consumer Financial Protection Bureau (CFPB), the chair of the Federal Trade Commission (FTC), and the heads of other agencies to stop pursuing disparate impact claims.
This article aims to help affected communities understand what Trump’s executive order means for them and how it affects advocacy work.
What is disparate impact?
As mentioned above, “disparate impact” is a legal term that refers to policies or actions that may appear neutral but in reality perpetuate historical discrimination that disproportionately, negatively affects a protected class of people, including people who identify with a specific race, color, religion, disability, national origin, and more. Numerous courts have allowed plaintiffs to bring disparate impact cases under various civil rights laws, including the Civil Rights Act of 1964, the Age Discrimination in Employment Act (ADEA) of 1967, the Fair Housing Act of 1968, the Rehabilitation Act of 1973, and the Americans with Disabilities Act (ADA) of 1990.
In Griggs v. Duke Power Co. in 1971, the U.S. Supreme Court established a three-part test to determine if a defendant is subject to disparate impact liability. First, the plaintiff must identify the protected class, the facially neutral policy or practice in question, and how the protected class is disproportionately harmed by this policy or practice. Second, the court must review the defendant’s justification of the policy or practice and its connection to the institution’s mission or goals. Lastly, the plaintiff must identify less discriminatory alternatives, and the court may evaluate them against the policy or practice at issue.
Importantly, the Supreme Court has repeatedly upheld disparate impact claims. Some examples include Albemarle Paper Co. v. Moody in 1975 and Texas Department of Housing and Community Affairs v. The Inclusive Communities Project, Inc. in 2015.* In Albemarle Paper Co. v. Moody, Black employees sued Albemarle Paper Co., alleging that the company used aptitude tests to make hiring and promotion decisions. The employees argued that while the test seemed neutral, it disproportionately negatively affected Black applicants, creating disparate impact. The Supreme Court sided with the employees, ruling that the company’s tests were not suited to or adequate for job-related assessments. Congress also codified disparate impact liability in numerous statutes, including the Civil Rights Act and the ADA.
What does this EO do?
This EO directs the federal government to stop bringing disparate impact lawsuits, to reevaluate all ongoing disparate impact lawsuits and enforcement actions, and to investigate state laws that impose disparate impact liability. It does not eliminate the use of disparate impact liability in court because it does not change existing laws authorizing these claims. Individual plaintiffs can still sue based on disparate impact under the ADA, Title VII of the Civil Rights Act, the ADEA, the Fair Housing Act, and other federal statutes.
Can people still bring disparate impact lawsuits?
Yes. Disparate impact liability was established by the Supreme Court in Griggs v. Duke Power Co. and codified by Congress in the Civil Rights Act of 1991. Presidents cannot make new laws via executive order, nor can they override a Supreme Court decision or overrule statutes passed by Congress; they can only direct the executive branch on how to interpret those laws. Businesses and other private employers remain liable for disparate impact discrimination, and plaintiffs can still bring claims. President Trump’s order only directs the federal departments and agencies to deprioritize enforcement and reevaluate, amend, and repeal all federal regulations, guidance, rules, and orders that impose disparate impact liability.
Does disparate impact liability allow for unlimited liability?
No—despite what the EO says, disparate impact does not create “a near insurmountable presumption of unlawful discrimination.” In fact, it is very hard to prove disparate impact discrimination. Plaintiffs need to provide a complicated, data-heavy statistical analysis to show disparate impact, making it a very high bar to meet—particularly if the data collected omit essential variables such as protected classes. As disparate impact discrimination concerns policies that do not explicitly discriminate against a given group, plaintiffs often have to hire statisticians and other experts to create elaborate datasets illustrating that a policy has a harsher impact on one group than another.
Is disparate impact liability bad for businesses?
No. Businesses have numerous protections when it comes to disparate impact liability. The three-part test ensures businesses have a safety net, forcing plaintiffs to meet a high burden of proof. Courts also recognize “business necessity” as a defense to disparate impact liability. If a business can show that a given practice is necessary for it to function and there is no policy that achieves a similar function, or if it can show that a similar policy does not decrease the disparate impact, the challenged policy or practice can remain in place. This provides a lot of latitude to businesses.
Does disparate impact liability harm workers?
No. Facially neutral policies that perpetuate historical discrimination and cause disparate impact harm workers by “depriv[ing] them of opportunities for success.” The legal theory of disparate impact does not take away opportunities; it ensures that opportunities are available for all people. Discrimination, whether identified as disparate treatment or disparate impact, hurts vulnerable workers. Stating policies are only discriminatory if one can prove they are intentionally so warps the purpose of civil rights protections.
Is disparate impact liability unconstitutional?
No. Disparate impact liability has existed since the 1960s and is squarely consistent with the principles undergirding the Constitution. The 14th Amendment specifically calls for equal protection, and without disparate impact liability, businesses could discriminate against Americans simply by avoiding discriminatory language. Though the 14th Amendment does not apply to private businesses, it is hard to believe that the principle behind equal protection would solely bar employers from saying, “No women for this role,” but allow them to say, “Only employees over 6 feet, 2 inches and 230 pounds are eligible.” Despite being phrased differently, both statements aim to exclude a specific group of people from opportunities.
Conclusion
Disparate impact is an essential legal principle used to provide protected classes the ability to fight against less overt discrimination. President Trump’s EO does not overturn Supreme Court decisions or congressional statutes. It only shifts how the federal government will enforce civil rights laws while causing confusion among the general public. The bottom line is that people can still bring disparate impact claims to court.
*Correction, August 14, 2025: This article has been updated to correctly list court cases in which the Supreme Court reaffirmed disparate impact.
The authors would like to thank William Roberts and Ben Olinsky for their reviews, Ben Greenho for fact-checking, and CAP’s Editorial and Legal teams for their guidance.