Dive Brief:
- Management and technology consulting firm Accenture will pay $25 million to settle U.S. Department of Justice allegations it has discriminated in its hiring and promotional practices based on race and sex in violation of the False Claims Act since 2017, according to a DOJ announcement Monday.
- According to DOJ’s allegations, Accenture took race and sex into account in both hiring and promotions in order to more heavily favor candidates who advanced their demographic goals. DOJ also alleged that certain training, partnerships, mentoring, leadership development programs and other opportunities were limited by race and sex.
- Under the second Trump administration, DOJ has used the False Claims Act to crack down on federal contractors’ diversity, equity and inclusion efforts. Deloitte agreed to pay $21.5 million to settle similar allegations in late August.
Dive Insight:
The False Claims Act imposes liability on companies that knowingly submit false or fraudulent claims for payment to the federal government. Law firm Helmer, Martins, Tate and Garrett noted in April that the “landscape is shifting rapidly” when it comes to FCA enforcement, with DOJ’s Civil Rights Fraud Initiative using the law to target DEI goals and methods.
“Most federal contracts contain a provision that requires contractors to provide equal opportunity to employees and applicants for employment,” DOJ noted in a press release on the settlement. “As a condition to being a federal contractor, the company must certify that it will not discriminate against an employee or applicant for employment because of race or sex and must further certify that it will take steps to ensure that applicants are employed, and employees are treated during employment, ‘without regard to’ race or sex.”
DOJ alleged that company leaders received monthly demographic updates that included the race and sex of employees, “with the figures highlighted green, yellow, or red to indicate whether representation was at or exceeded AFS’ goal.”
“These demographic goals were designed to, and did, drive changes in hiring practices based on race and sex,” DOJ said. “For example, at the end of 2020 and beginning of 2021, AFS engaged in a round of entry level employee hiring to make further progress towards the company’s racial representation goals.”
Similarly, DOJ alleged Accenture provided for candidates who could advance its demographic goals to be more easily promoted by holding separate discussions about them, highlighting their names and developing a separate “pipeline” for them.
“Accenture complies with applicable laws, and our resolution does not constitute an admission of liability,” a spokesperson for the company told HR Dive. “We have cooperated with the government’s review, and we are pleased to put this matter behind us to avoid the costs and resource demands of prolonged litigation.”
Accenture in February 2025 said it would end its global employee representation goals and other DEI programs to comply with President Donald Trump’s anti-DEI executive orders.
Attorneys have repeatedly warned employers against DEI goals that could incentivize discriminatory conduct. Even “aspirational goals” to improve workforce diversity metrics could be challenged as encouraging or resulting in de facto quotas, a partner with Duane Morris previously wrote for HR Dive.
The Accenture agreement marks at least the third such settlement this year; before the Deloitte settlement in August, IBM in April agreed to settle similar allegations for $17 million.