In the recent U.S. Supreme Court decision in Ames v. Ohio Department of Youth Services, the justices agreed that that plaintiffs who are members of a majority group do not need to show additional “background circumstances to support the suspicion that the defendant is that unusual employer who discriminates against the majority.”
In the wake of this decision and some similar claims, employers are facing an increased possibility of employment practices liability (EPL) claims that allege “reverse discrimination”—discrimination against members of a majority class—which presents employers with nuanced risks that, while not legally new, reflect shifting societal attitudes and regulatory scrutiny.
The plaintiff in Ames was a straight woman who alleged that she had been discriminated against when she lost a promotion to a gay coworker and was demoted and replaced by another gay coworker. By eliminating the extra requirement to show that an employer discriminates against the majority, the Supreme Court’s ruling makes it easier for plaintiffs alleging reverse discrimination to prove their case.
The potential for an uptick in such claims is also partly due to recent changes at the federal level, namely, the rollback of certain diversity, equity and inclusion (DEI) initiatives. Eliminating affirmative action policies for federal contractors has empowered more individuals from historically non-protected classes to file claims, meaning an employer with robust DEI policies could potentially face allegations of unfair treatment from individuals from a historically favored class.
In addition, the potential for one reverse discrimination claim to turn into a class action has significantly increased. According to the Class Action Review—2025 by law firm Duane Morris, the 2023 U.S. Supreme Court decision in Students for Fair Admission v. President and Fellows of Harvard College already led to a marked increase in the number of claims alleging reverse discrimination in DEI programs last year.
How Reverse Discrimination Claims Arise
Reverse discrimination claims are ultimately conventional discrimination claims. Although discrimination laws have not directly changed, there has been a clear shift in the perception and social climate, resulting in heightened awareness and a greater willingness among individuals to bring these kinds of claims forward.
Typical reverse discrimination scenarios involve hiring or promotion decisions. For example, a qualified white male candidate who is not selected for a promotion may allege that he was unfairly passed over in favor of a candidate chosen due to DEI objectives rather than merit.
Another scenario might involve disciplinary actions perceived differently based on race or gender. For example, a long-time employee disciplined and eventually fired due to offensive humor might claim reverse discrimination, arguing that a person of a different race, gender, religion or sexual orientation would not have faced similar consequences.
Risk Management Best Practices for Employers
While reverse discrimination claims follow similar procedural patterns as traditional discrimination claims, requiring proof of adverse employment action linked directly to protected status. However, they can pose unique challenges for risk management.
Employers now face scrutiny for both having and not having DEI policies. A robust DEI policy could be construed as evidence of “systemic discrimination,” while the absence of a policy can suggest negligence or indifference toward discrimination issues. This puts human resources, legal and risk management professionals in a difficult position and makes documentation critical.
Employers must consistently and clearly document performance issues, employment decisions and rationale based on merit rather than demographics. Such documentation can include notes made during meetings with the employee as well as regular written performance appraisals.
To mitigate the risks associated with reverse discrimination claims, here are several key steps employers can take:
- Consult with legal and other experts: Regularly engage external and internal counsel and risk managers to understand evolving laws and interpretations of Title VII (the federal law that prohibits employment discrimination) and similar state laws.
- Maintain robust documentation: The most common mistake managers and HR professionals make is insufficient documentation. Employers must anticipate challenges by clearly articulating why employment decisions are made. All employment decisions need to be well-documented, justified by legitimate business reasons and consistent with company policies to mitigate the risk of retaliation claims.
- Review policies and training: Regularly update company policies and provide DEI training for managers and executives to effectively handle sensitive employment matters.
- Implement claims handling strategies: Maintain confidentiality, avoid retaliatory actions and promptly inform insurers upon receiving claims.
Additionally, employers should exercise caution when taking any employment actions following an employee’s discrimination complaint or allegation. Even seemingly minor changes, such as shifts in scheduling, departmental transfers or altered job duties, can be interpreted as retaliation, complicating claim defense and potentially increasing liability.
The Role of EPL Insurance
Subject to the policy’s terms and conditions, EPL insurance typically covers claims related to discrimination, wrongful termination, sexual harassment, retaliation, defamation, invasion of privacy, failure to promote and various other employment-related issues. It generally includes coverage for legal defense costs, settlements and judgments resulting from claims, ensuring employers are financially prepared for litigation and associated expenses.
Given the increasing complexity of employment laws and the rise in workplace litigation, having EPL insurance can be an essential component of a company’s risk management strategy. Having EPL coverage provides financial protection, resources for risk management and legal support for employers facing these complex claims.
Navigating the Evolving Landscape
With increased attention from recent successful reverse discrimination claims, employers should remember the imperative to balance fairness and merit-based decision-making. Actions like proactive risk management, consistent documentation and staying abreast of employment-related legal developments are more important than ever. Claims management and proactive policies will become even more critical.
Along with legal counsel, employers can leverage their insurers as external advisers when addressing reverse discrimination issues. Some insurers may provide access to specialized legal expertise and resources to assist employers in navigating complex claims, interpreting evolving regulations and implementing effective risk management strategies. Taking advantage of these external risk management resources can help businesses maximize the value of their insurance policies and more proactively and effectively manage risks.