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“This really is a novel extension of the False Claims Act to address an enforcement priority for this new administration, and address what it views as unlawful DEI,” says Driscoll. “The DOJ bases investigations on a preponderance of evidence, so these claims are easy to prove and the damages are tremendous.”
But companies that receive federal funds will have to figure out in advance how they may handle a DEI “fraud” claim, should it arise, says Vanessa Matsis-McCready, associate general counsel and vice president of human resources for Engage PEO, an HR outsourcing platform.
“Best practice is to routinely evaluate corporate programs to ensure they are not disparately impacting any particular groups, and that they are applied consistently in a business neutral manner,” she says. “It is also recommended that employers reiterate reporting procedures, review all complaints or concerns that are raised and investigate further when appropriate.”
