DEI rollback & law firm recruiting 2026: what actually changed

March–April 2025: EEOC letters and the four-firm settlement

On 17 March 2025, EEOC Acting Chair Andrea Lucas sent letters to 20 major law firms requesting information on whether their DEI policies created disparate treatment against white or male employees under Title VII. Most firms did not respond.

Four chose to settle: on 11 April 2025, Kirkland & Ellis, Latham & Watkins, Simpson Thacher & Bartlett, and A&O Shearman signed multi-year agreements with the EEOC. Under the settlements — reached without admission of liability — the firms affirmed commitment to “merit-based hiring, promotion and retention,” agreed not to engage in preferences based on race or sex, and agreed not to categorise any lawful employment practices as DEI. The probe of the remaining 16 firms was closed without enforcement action on 9 February 2026, after law students successfully challenged the investigation on privacy grounds.

January–June 2026: FTC targets the Mansfield Rule

In January 2026 the Federal Trade Commission launched a formal investigation into Diversity Lab, issuing 42 warning letters to participating law firms. The FTC’s theory was that Mansfield certification constituted an anticompetitive agreement on hiring standards.

Diversity Lab announced a pause on the Mansfield Rule in February 2026 and furloughed most staff. After months of negotiations over a proposed consent decree — which would have required the organisation to end the Mansfield Rule and submit FTC compliance reports every 150 days — founder Caren Ulrich Stacy declined to sign. She cited the risk of handing over confidential client data on the approximately 400 law firms and legal departments that had participated in the programme since its founding in 2016.

Diversity Lab formally closed on 5 June 2026. All firm data was destroyed as part of the dissolution. A federal court had earlier affirmed that Mansfield “expressly does not establish any hiring quotas” — but the operating funds needed to contest the investigation were gone.

Sources: EEOC press release (11 April 2025), Bloomberg Law. “White House arrangement” denotes the commitments — totalling $700 million in pro bono and public-interest work across the six firms — that resolved EEOC inquiries.

A parallel data point from the NALP Foundation’s CY 2025 associate attrition update (published April 2026) sharpens the picture: associates of colour departed at a 25% rate in 2025, compared to a 16% rate for white associates. The entry-point gap and the retention gap compound. A smaller incoming cohort of diverse summer associates, combined with a higher departure rate once hired, produces a structural pipeline problem at both ends.

Lateral hiring is partly filling the gap — and changing the composition

NALP’s lateral hiring data (released May 2026) adds context: lateral associates accounted for 49% of all new associate hires in 2025, surpassing entry-level graduates (38%) for the first time. Overall lateral hiring was up 16% year-on-year.

This shift matters for diversity because the summer-associate programme has historically been the primary structured channel for entry-level diversity hiring — a defined, cohort-based process that lends itself to explicit sourcing strategies. Lateral hiring is a more fragmented, experience-led market. The practical implication: as the weight of associate intake shifts from campus programmes to lateral channels, diversity outcomes in lateral hiring become more determinative, and less visible.

Source: NALP — U.S. Law Firm Lateral Hiring Shows Broad Growth in 2025 (May 2026); overall lateral hiring up 16% year-on-year.

The structured pipeline has contracted, not disappeared

Diversity fellowship programmes and 1L diversity recruiting still exist at a number of major firms. What has changed is the infrastructure around them: the external certification system (Mansfield) is gone; the external benchmarking pressure from corporate clients has largely been removed; the internal branding and tracking of these programmes has been revised or dropped at most AmLaw 50 firms; and the NALP dataset that made firm-level comparison possible has shrunk. The absence of these mechanisms matters independently of whether individual firms maintain their pipeline programmes.

Data opacity and self-selection in the remaining NALP pool

When approximately a third of the firms that previously submitted diversity data to NALP stop submitting, the aggregate numbers become harder to interpret. The firms most likely to withdraw are either those with the weakest diversity numbers (avoiding negative disclosure) or those most sensitive to regulatory scrutiny (avoiding data collection for its own sake). The firms that keep reporting may skew toward those with stronger or at least stable programmes. That means the remaining numbers — already showing declines — may, on balance, overstate diversity in the BigLaw population as a whole.

The attrition multiplier

Entry and retention compound. The NALP Foundation CY 2025 data show associates of colour departing at a 25% rate, compared to 16% for white peers — a 9-percentage-point gap that persists regardless of entry conditions. Even if summer associate cohorts stabilise at current levels, the pipeline continues to drain faster at one end than the other. Firms operating without the Mansfield framework’s advancement-process transparency provisions lose the structural mechanism most directly aimed at the retention side of this equation.