Four Legal Trends Impacting Higher Education Institutions

Transcript

Débora Avelino

Associate, Denver

Hi, everyone. Thank you so much for joining us today. My name is Débora Avelino, and I'm an associate in the Denver office. I'm joined here by Mike Bertoncini, principal in the Boston office. We both work with clients in the higher education industry, and are here today to talk about a few topics that we've been seeing our clients have challenges with. We are going to cover four topics, the first one being ‘illegal DEI.’

We can't be in 2025 and not talk about ‘illegal DEI.’ It all started at the beginning of the year, January 22nd, 2025, with the issuance of Executive Order 14173 by President Trump. That executive order focused on the concept of meritocracy and the prohibition against 'illegal DEI', among other subjects and issues. Prohibition against 'illegal DEI' was a topic that immediately caused concern, not only in higher education but also in various industries. Employers became concerned about what that meant. The idea behind the Executive Order was that diversity, equity, and inclusion programs, policies, and procedures should not, in the name of DEI and promoting diversity, engage in discrimination based on a protected characteristic. However, the ‘illegal DEI’ terminology in the Executive Order was not defined. First, we had a round of challenges to better understand what that meant. As time passed, we got a little bit more guidance from federal government agencies, even some lawsuits regarding what all that meant. 

With the progress on the subject, we've also seen progress in our higher education partners regarding what challenges they're now focusing on. At first, when this all became an issue, we saw a lot of higher education institutions pausing to do an assessment of all of their practices, policies, both on the student side and on the staff, faculty, and employment side, to determine, based on these new lenses, whether their practices are sound. Did they present a risk? How much risk did they present? Mike will discuss how the DOJ and the False Claims Act have been invoked to discuss ‘illegal DEI,’ to enforce the prohibition against ‘illegal DEI,’ but we've seen a spectrum. 

Right at the beginning with those assessments, we saw our clients focusing on things like employee resource groups and how to organize those groups.  Considering that, in higher education, this is high stakes. We are talking about potentially losing grants and creating a problem for the financial stability of institutions. With time, again, we looked at recruitment and a lot of universities reimaged some practices that existed and were established for a long time. 

Now, with the passage of time and better guidance, we've seen a new set of challenges here. Those challenges are regarding all of the data that universities collect or have collected, and how that is analyzed. Ensuring all of that was a priority that's easier to accomplish outside of the higher education industry, but harder for the Office of General Counsel. At the time, the OGC was just trying to catch up and learn after studies were made and after data analysis was already performed, how the demographic information and demographic data were being used and considered. All of that, again, in the higher education industry, there are higher stakes. 

Part of those higher stakes is something that we've been seeing with the DOJ and its enforcement initiatives, which is something Mike here is going to cover for us. Mike?

Mike Bertoncini

Principal, Boston

Thanks, Débora. Let's talk a little bit about the Department of Justice and their Civil Rights Fraud Initiative. This is something that was announced on May 19, 2025, in a Memorandum issued by Deputy Attorney General Todd Blanch. The Memo directs all DOJ attorneys to use the False Claims Act to “investigate and, as appropriate, pursue claims against any recipient of federal funds that knowingly violates federal civil rights laws.” This is a tool, the False Claims Act, that has been used pretty effectively by the DOJ in other realms. It’s something that, if you look at what the Trump administration is doing as a whole, we have the ‘illegal DEI’ that Débora talked about, the Civil Rights Fraud Initiative in May, and the October 1st Compact for Academic Excellence in Higher Ed. There is a concerted effort to look at higher education and, frankly, to bring to bear some pressure. What the initiative does is it targets, and again, I'm going to quote this memo, it “targets the many corporations and schools that accept federal funding that continue to adhere to racist policies and preferences, albeit camouflaged with cosmetic changes that disguise a discriminatory nature.” You can see that it's continuing to build upon the ‘illegal DEI’ concept. There's an example of particular note in the Memo to higher ed institutions, which gives this example: “a university accepting federal funds that encourages anti-Semitism, refuses to protect Jewish students, allows men to intrude into women's bathrooms, or requires women to compete against men in athletic competitions.” You can see the themes continuing to build throughout here. 

What does this mean as a practical matter for colleges and universities? Sort of more of the same that Débora touched upon. You've got to align your policies with federal anti-discrimination laws. You've got to do your due diligence about certifying compliance with the government. This is an area where it’s really important, as a former in-house counsel myself, to be sure that those of you in the general counsel's office are reaching out to your colleagues all across the institution. As we know, sometimes your internal clients will sign off on documents and maybe haven't given them quite the review you'd like. Here, it's super important because that certification of compliance with federal law is going to be the basis of the False Claims Act action that's going to be brought pursuant to this initiative. You've got to be very, very careful about the breadth of that certification. Update your compliance programs. 

Then, finally, do a risk calculation. Again, as we've been saying, really, since that ‘illegal DEI’ EO came out, this requires a look across the entire institution, and it requires buy-in from all stakeholders within the organization. In some ways, this is just further blocking and tackling, if you will, in a way that perhaps we were not doing before the Trump administration came in. However, this is yet another example of when you have to do it and why you have to do it. The penalties available under the False Claims Act are very, very serious. They get very expensive, very fast. Again, this is something that bears greater internal communication and rigorous review. It's of paramount importance that you do that review. 

With that, I'm going to turn it back to Débora.

Avelino 

Mike, in terms of that blocking and tackling, I wanted to talk a little bit about some changes that we had in the affirmative action world. We are not talking here about affirmative action in terms of admission of students, but I'm going to talk about affirmative action for federal contractors. The same executive order we've been discussing, the ‘illegal DEI’ EO 14173, revoked EO 11246, which is an executive order from the Lyndon Johnson era that established affirmative action for what we used to call women and minorities, so affirmative action based on race and ethnicity and sex assessment. We used to use affirmative action to look at our workforce and compare it to the labor market to see areas of underutilization. All of that based on race and sex is now gone since Executive Order 14173 was issued. Only affirmative action for veterans and individuals with disabilities remains. Since January, universities have begun the process of winding down their women and minority affirmative action programs and maintaining their veterans and individuals with disabilities plans. 

Now we have a proposed rule here that's being put through the rulemaking process. We just want to make sure all of our colleagues within higher education are aware of this because it is going to require some of that blocking and tackling. This proposed rule is pretty much eliminating quantitative analysis for disability. If we look back to 2014, that's when the OFCCP, through implementing regulations for Section 503 of the Rehabilitation Act, started collecting disability data and began requiring that federal contractors collect disability data for applicants and employees in a few moments in time – first, during a job application, and second, after an offer is made, but before employment starts. Then, there are requirements regarding surveying the workforce every five years and reminding employees to self-identify in the meantime. 

When that obligation started, there were a lot of concerns regarding how that interplayed with the Americans with Disabilities Act, because we are, in essence, asking disability and medical-related questions during the job application process. At the time, a Memorandum of Understanding was executed between the OFCCP, which is the Office of Federal Contract Compliance Program – the agency that oversees and regulates affirmative action –, and the EEOC due to the disability component. That Memorandum of Understanding allowed employers to ask disability-related questions and ask for the self-identification via an approved OMB form that has been used by employers ever since. It is updated with a certain frequency, but the form is still used. Now, because it is a compliance requirement, our HRIS systems are asking that question. The proposed rule is still being reviewed after the comment period. The comment period ended in mid-September, and we still haven't heard anything. However, the proposed rule eliminates all of the data collection. It still maintains affirmative action, but more on a qualitative basis. We still have obligations to assess our outreach. We still have to look at our processes and policies to ensure there are no barriers for individuals with disabilities and all of the other aspects of the affirmative action plan. However, we'll no longer be looking at our applicant and the hiring of individuals with disabilities compared with our applicant and hiring overall numbers. We'll no longer be looking at our workforce and comparing it with a utilization goal of 7% like we used to. All of that is going to go away.

There is a very practical question here, which is that those questions are being asked in our ATS and HRAS systems. We are collecting that information because even today, as of November 2025, we are still required to collect that. 

Here is another area where we'll need buy-in from our campus partners, like Mike referenced. That buy-in is also important because we are at a point where if we stop asking self-identification questions for disability, people may notice. Our advocates for disability inside the university may notice. This is a good opportunity, since we're still waiting for the proposed rule to be finalized, to determine what level of communication we want to have beforehand, what buy-in we want, and what type of heads-up we want to give within our university regarding why people might not see self-identification for disability. Types of conversations, such as What is the mission of the university, given the fact that discrimination is still prohibited. Conversations about the fact that we are no longer asking for self-disability are based on all of these legal questions and not based on a cultural shift from the university. These are all areas that we still have some time to tackle and might be good for our relationships within campus, and to try to avoid friction.

Mike, I'll turn it back to you with our last topic.

Bertoncini 

Thank you. I'm going to provide a brief update on the state of the state with regard to organized labor in the National Labor Relations Board. In reverse order, at the National Labor Relations Board, as of October 20th, 2025, we have one member of the National Labor Relations Board currently seated. We have an acting general counsel. The Senate Health, Education, Labor, and Pensions Committee, the HELP Committee, has approved the nomination of one member, James Murphy, and the General Counsel, Crystal Carey. A vote of the full Senate is the next step that has not yet been scheduled. Note that to have a quorum at the NLRB, one needs to have three members seated. President Trump's other nominee, Scott Mayer, has had his nomination tabled. He is not going forward to a vote of the full Senate, at least as of now, which means that even if the Senate votes in the affirmative, we still will not have a quorum at the National Labor Relations Board.

If you look at organizing, I frankly expected to see a spike in organizing driven by a sense of uncertainty, in the sense that perhaps there would be greater job security through union representation. To date, we have not seen that. We have not seen a spike in organizing, which is particularly true in higher ed. One thing to note on the higher ed front, what I do not expect to see is the spike in any form of student organizing, whether that be grad students or student athletes. The reason for that is that with a Republican-majority Board, the unions are concerned that the Columbia University decision will be overturned, calling into question once again whether students are able to be considered employees who can organize. To the extent we're going to see organizing, it's not going to be on the student side; it's more likely to be on the staff side. 

One thing we are beginning to see, because the Board has not had a quorum since, I believe, late January, after the President fired member Wilcox, unions are getting impatient with their ability to move cases along. That's becoming more true with the government shutdown. We're beginning to see unions that file election petitions right before the shutdown. We're seeing them put pressure on employers to either voluntarily recognize them or to find a third-party neutral to conduct the elections. If this shutdown drags on much longer, we're likely to see more pressure along those lines. 

At the collective bargaining table, there are a couple of things that are happening that bear discussion and consideration before you find yourselves facing the unions at the table on these issues. The first is academic freedom. We're seeing unions push for academic freedom language in their contracts in a way that I have not seen before. That is because of two things. One, it's fallout from the protests that we saw over the last couple of years. The second is a direct reaction to concerns that the Trump administration is going to somehow restrict academic freedom. The proposals that we're seeing at the bargaining table are proposals that are different than the academic freedom policies that you may have set forth in your faculty handbooks. Unions are often less willing to accept what I would call a ‘me too clause’ that says you'll be afforded the same academic freedom as other faculty through the faculty handbook, as it may be amended. They're looking for a firm commitment about what that policy is going to say. In many instances, they're looking for broader protections than your existing policies grant. So, that's the first piece. 

The other thing we're seeing is that the economic uncertainty that academic institutions face today is not leading to a tempering of wage proposals. If anything, it's leading to the opposite. Unions seem very concerned that they will bear the brunt of these financial difficulties. Rather than tempering their wage proposals, they're swinging for the fences. I find they are not moving down into a realm of wage increases that most employers are willing to offer in these uncertain times. That's becoming more difficult, so be prepared for wage proposals that are higher than you are willing to pay and that are harder to bring down to a level that you're willing to engage on. 

The last thing that I am starting to see, and that you need to prepare for, is union protest activity. Not necessarily a strike but a greater willingness to picket, a greater willingness to engage in leafleting and hand-billing during events such as open houses, big events with potential students visiting, disrupting presidential ‘state of the university addresses,’ and all that protest activity that doesn't result in a loss of pay for the faculty members or other organized workers. We're seeing a lot more of that kind of activism. That’s the type of thing you need to plan in advance for, and you need to really focus on your communication strategy around that. So, that's really all that I wanted to get you thinking about with respect to the labor front.

We are in for a little bit of a rockier time than we perhaps had in the past on it. All of which we can deal with, but it's going to take some intentionality and some forward-thinking and  planning around communications in a way that may be new to some employers. 

With that, those are the four big topics that we wanted to cover in this podcast. We really appreciate you tuning in, and hope that you'll watch our website for future editions of this. The Education and Collegiate Sports Group is committed to rolling these podcasts out and we're always happy to try to address topics that we think are a front of mind for you all. Thank you.