DEI In The Spotlight: Wage And Hour Implications

With the nation's heightened focus on DEI programs and policies, U.S. employers should carefully evaluate the legal risks associated with their DEI-related wage and hour practices.

Many employers across a broad range of industries—including financial services, technology, media, healthcare, retail, and professional services—utilize compensation-related incentives to support their DEI efforts. Practices that are likely to be scrutinized by those targeting an employer's DEI initiatives include:

• Diversity referral bonuses. Over the last decade, a number of leading employers have included as a component of their overall DEI efforts a program providing special bonuses to employees who successfully refer diverse candidates. To the extent such bonuses exceed those paid to employees for referring non-diverse candidates, they will likely be among the "low hanging fruit" for challenges.