IBM has reached a settlement with the US federal government on Friday — agreeing to pay $17 million to resolve an anti-DEI investigation. The Donald Trump administration has come down heavily against diversity, equity and inclusion practices over the past year with executive orders escalating pressure on the private sector.
The Department of Justice has accused the New York-based technology firm of “knowingly” making “false claims” about its hiring and employment practices in federal contracts. The settlement document also accused IBM of identifying “diverse” candidates for hiring or promotions while developing race and sex demographic goals. IBM has denied the accusations and the settlement added that their agreement was not an admission of guilt.
“IBM is pleased to have resolved this matter. Our workforce strategy is driven by a single principle: having the right people with the right skills that our clients depend on,” the company told CNN.
Trump leads DEI crackdown
The settlement marks the first resolution from the DOJ unit formed last year called the “Civil Rights Fraud Initiative” to crack down on DEI policies using a civil anti-fraud law. Trump has targeted public and private organizations – from government agencies to private universities – over DEI practices that civil rights advocates say help address historic inequities for marginalized groups like women and ethnic minorities.
The White House casts DEI as anti-merit and discriminatory against groups like white people and men. Trump has signed executive orders asking federal contractors and subcontractors to eliminate DEI.
Many US companies scaled back or modified diversity policies after Trump’s orders.