The proposal to rescind the Uniform Guidelines on Employee Selection Procedures is undergoing its final review by the federal government. A request for a preliminary injunction against a DEI executive order was denied by a federal court. In a reverse sex discrimination case brought by the Equal Employment Opportunity Commission (EEOC), a district court denied a motion to dismiss. The Department of Labor (DOL) withdrew three wage-hour opinion letters concerning tipped employees.

Uniform Guidelines Rescission Advances – The Equal Employment Opportunity Commission (EEOC) has sent the proposed rescission of the interpretive rulemaking portions of the Uniform Guidelines on Employee Selection Procedures (UGESP) to the Office of Information and Regulatory Affairs (OIRA), which is part of the Office of Management and Budget (OMB). The EEOC intends to publish the rescission as a final rule in November with an effective date in January 2027. The proposed language has not been published for public review and comment.

UGESP was finalized and adopted in 1978 by the EEOC, the Department of Labor, the Department of Justice, and the Office of Personnel Management (OPM). UGESP applies to employee selection procedures such as tests. When a selection procedure is found to have an adverse impact, the employer is required to validate the procedure and retain the validation documentation. OPM issued an interim final rule in July to remove references to UGESP from the federal civil service regulations. The Office of Federal Contract Compliance Programs (OFCCP), which is part of the Department of Labor, finalized its rule eliminating the regulations implementing Executive Order 11246, promulgated in 1965, that created antidiscrimination requirements for federal contractors and subcontractors. As part of this action, OFCCP also removed the UGESP rules. These actions became effective on October 26.

DEI Executive Order Upheld – The United States District Court for the District of Maryland denied a motion for a preliminary injunction prohibiting implementation of Executive Order 14398, “Addressing DEI Discrimination by Federal Contractors.” In a narrow opinion, the District Court, in the case of National Association of Diversity Officers in Higher Education v. Donald J. Trump, stated that the order “only prohibits contractors from engaging in conduct that is already prohibited by federal law: intentional discrimination on the basis of race or ethnicity.” The District Court cited language from a Fourth Circuit Court of Appeals decision in a case brought by these plaintiffs challenging an earlier DEI executive order, that “there is ‘absolutely’ DEI activity that falls comfortably within the confines of the law.”

This lawsuit was brought by five organizations whose membership includes government contractors. They assert that the order is unconstitutional and sought a preliminary injunction. The executive order defines “racially discriminatory DEI activities” to mean “disparate treatment based on race or ethnicity in the recruitment, employment (e.g., hiring, promotions), contracting...” Since the executive order only prohibits contractors from engaging in intentional discrimination on the basis of race or ethnicity, the court concluded that it “will not silence a substantially disproportionate amount of protected speech and thus is not constitutionally overbroad.” In a press release, the plaintiffs stated that “This ruling provides crucial clarity for federal contractors and subcontractors: at bottom, the executive order challenged in this case means nothing more than ‘follow the well-settled law.’”

Motion to Dismiss Reverse Discrimination Lawsuit Denied – The United States District Court for the District of New Hampshire has denied a motion to dismiss a case brought by the Equal Employment Opportunity Commission (EEOC) on behalf of a male employee claiming that a female-only conference constituted sex discrimination in violation of Title VII of the Civil Rights Act of 1964. In denying the summary judgment motion in the case of U.S. Equal Employment Opportunity Commission v. Coca-Cola Beverages, Northeast, Inc., the judge concluded that “the EEOC has plausibly alleged that Coca-Cola’s conduct amounts to actionable harm under Title VII.”

The EEOC alleged that Coca-Cola violated Title VII by not allowing male employees to attend Coca-Cola’s Women’s Forum, a two-day conference that the employer contends was focused on increasing the pool of candidates for promotion. In September 2024, Coca-Cola sponsored a Women’s Forum networking event in Connecticut, and those female employees who attended were paid their regular wages and were provided with paid hotel rooms and food and beverages. Male employees were not invited, and several male employees said they would have attended if invited. The EEOC contends that the male employees suffered damages based on sex, since they were not provided with any of the benefits associated with attendance at the Forum.

The District Court noted that in 2024, the Supreme Court in the case of Muldrow v. City of St. Louis ruled that a plaintiff must “show some harm respecting an identifiable term or condition of employment to establish a discrimination claim under Title VII, but the harm need not be significant.” The judge believed that the EEOC met, for the purposes of the motion to dismiss, the Muldrow standard “by pointing to missed networking opportunities, the potential deprivation of paid time off, and the denial of perks including a company-paid hotel stay, food, and beverages.” The case will proceed to trial.

DOL Withdraws Opinion Letters on Tipped Employees – The Wage and Hour Division (WHD) of the Department of Labor (DOL) issued a Field Assistance Bulletin withdrawing three opinion letters concerning tipped employees. The WHD stated that this withdrawal “confirms that any guidance that contemplates specific time limits on duties performed within a tipped occupation no longer reflects WHD policy.”

Section 3(m) of the FLSA, 29 U.S.C. 204(m), allows employers to take a partial credit against their minimum wage payment obligations to tipped employees, provided the employees work in occupations in which they customarily and regularly receive more than $30 per month in tips. The initial dual jobs regulation provided that employers can only take tip credits for those hours in which the tipped employees are engaged in an occupation for which they receive tips. For any hours worked in a non-tipped occupation, employers could not take the tip credit and had to pay employees at least the full minimum wage. In 2021, DOL issued a revised dual jobs rule stating that tipped employees “must receive the full minimum wage from their employer whenever non-tipped, directly supporting work exceeds 20 percent of their workweek or 30 continuous minutes.” The DOL issued guidance providing that where tipped employees spend in excess of 20 percent of their time performing general preparation or maintenance work, the employees are no longer engaged in a tipped occupation.

In 2024, the United States Court of Appeals for the Fifth Circuit decided in the case of Restaurant Law Center v. U.S. Department of Labor that the 2021 dual jobs rule was inconsistent with the FLSA since it was based on how long employees perform specific tasks and whether such tasks are tip-producing. DOL subsequently withdrew the 2021 regulation and reinstated the initial dual jobs regulation.

Neil Reichenberg is the former executive director of the International Public Management Association for Human Resources. He is an attorney, a frequent writer and speaker on public policy and human resource issues, and an adjunct faculty member at George Mason University. For questions or additional information, contact Reichenberg at [email protected].