The U.S. Federal Trade Commission (FTC) has taken a significant step in enforcement by issuing warning letters to
42 top U.S. law firms, cautioning that certain diversity, equity and inclusion (DEI) hiring practices could potentially violate federal
antitrust laws if they restrain competition for legal talent. The move intensifies scrutiny of DEI initiatives in the legal sector amid broader political and regulatory pushback against diversity programs nationwide.
FTC’s Action and Antitrust Concerns
On January 30, 2026, the FTC notified dozens of prominent law firms, including industry leaders, that some collaborative DEI hiring practices may be seen as
“unfair or anticompetitive” under U.S. competition laws. The agency described its action as a cautionary measure, alerting firms to the potential for liability rather than alleging specific illegal conduct.
In its letters, FTC officials raised concerns that
shared diversity benchmarks or coordinated hiring commitments even if voluntary might involve agreements that affect competition in the legal workforce. For example, if firms agree to common standards for candidate pools based on characteristics such as race, ethnicity, gender or other personal traits, that could be interpreted as collusion that distorts hiring, compensation or promotion decisions.
These warnings reflect how antitrust laws apply broadly to agreements that influence market behavior. The FTC’s position is that agreements among competitors on hiring criteria even if designed to promote inclusion can risk suppressing free competition for talent if they are not carefully structured within legal boundaries.
Diversity Lab and DEI Certification Programs
A key focus of the FTC’s scrutiny is the role of Diversity Lab, a private consultancy that runs one of the legal industry’s most prominent DEI certification programs. The Mansfield Rule initiative certifies law firms that meet specific diversity benchmarks—for example, ensuring that at least 30% of leadership candidate pools consist of lawyers from
underrepresented groups.
More than 360 law firms have been certified under Mansfield or similar programs, which seek to encourage more equitable representation in hiring and leadership recruitment. However, the FTC letter indicates that coordination on such DEI metrics could raise red flags if firms align too closely on specific diversity objectives.
The agency’s warning is consistent with heightened regulatory focus on DEI initiatives across multiple federal agencies. Last year, the U.S. Equal Employment Opportunity Commission (EEOC) requested detailed demographic and hiring data from several large law firms as part of its own separate inquiry into hiring practices.
Political and Regulatory Backdrop
The FTC’s warning comes amid a broader political and legal push by the Trump administration to challenge corporate DEI programs. Since returning to the White House, President Donald Trump has rolled back government DEI initiatives, and federal agencies have increasingly taken aim at private sector DEI practices as potentially discriminatory or unlawful.
In 2025, the administration issued executive orders targeting certain law firms and standards related to diversity practices, sparking litigation and controversy. Lawsuits from firms such as
Perkins Coie, Jenner & Block, and WilmerHale challenged these government directives in court, and some were struck down by federal judges for overstepping legal authority.
Still, regulatory pressure has persisted. The FTC’s action aligns with the administration’s broader stance, signaling to law firms that even voluntarily adopted industry best practices for hiring diversity may be subject to competition law risks if implemented collaboratively.
Impact on Law Firms and Industry Response
Many of the firms receiving the FTC’s letters have already adjusted their diversity programs in response to ongoing scrutiny. Some firms have scaled back or rebranded internal DEI initiatives, removed certain language from recruiting materials, or suspended participation in external diversity programs.
For example, some law firms have discontinued affinity groups or paused certification participation with organizations like the Leadership Council on Legal Diversity (LCLD), reflecting sensitivity to regulatory and political pressures.
Despite these adjustments, the legal industry is now grappling with how to strike a balance between promoting diversity and ensuring compliance with antitrust and employment law. Firms may need to revisit the structure of DEI collaborations and seek legal guidance to avoid unintentional anticompetitive implications.
Legal and Compliance Considerations
Lawyers and compliance experts note that antitrust laws are complex and that context matters. Agreements that unreasonably restrain trade or influence hiring conditions among competitors can run afoul of U.S. competition law, but not all cooperative efforts are unlawful. Independent decision-making by each firm and transparent justification for diversity practices can help mitigate risk.
Moreover, the FTC’s warning does not entirely prohibit DEI initiatives. Rather, it underscores the importance of ensuring that efforts to increase diversity do not involve explicit coordination with competitors on hiring metrics that affect compensation, promotion or workforce selection.
Looking Ahead
The FTC’s action adds another layer of complexity for law firms navigating DEI policies. As legal employers seek to build more inclusive workforces, they must remain mindful of
federal competition laws and evolving regulatory interpretations. Experts predict that law firms will increasingly consult antitrust counsel when designing diversity programs to ensure compliance while continuing efforts to advance inclusion in the profession.
This latest enforcement signal from the FTC is likely to reverberate beyond Big Law, prompting corporations and other industries to reassess how DEI practices are structured and communicated in hiring processes.
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