Accounting and consulting firm Deloitte has agreed to pay $21.5 million to resolve a US government investigation into its diversity, equity and inclusion (DEI) practices.
The settlement was announced by the US Department of Justice (DOJ) under its Civil Rights Fraud Initiative, launched in May 2025.
The government alleged that Deloitte violated the False Claims Act by falsely certifying compliance with anti-discrimination provisions linked to its federal contracts.
Allegations over hiring and promotions
According to the DOJ, Deloitte considered race and sex in employment decisions, including hiring, promotions and staffing, while pursuing internal workforce composition targets.
The government alleged that Deloitte business units received monthly reports showing their progress against demographic objectives. Performance was categorised using colour-coded indicators depending on whether targets were exceeded, met or significantly missed.
The DOJ further alleged that some senior Partners, Principals and Managing Directors had their evaluations influenced by progress towards these workforce goals. For around 150 senior executives, compensation could also be affected if their business units failed to meet demographic targets.
The government also alleged that racial and gender considerations influenced promotion decisions for senior positions and that certain employees were identified by race and sex during selection processes.
Dispute also covered federal contract staffing
The allegations extended to staffing employees on federal projects. Deloitte was accused of identifying workers by race and sex and encouraging staffing managers to consider demographic composition when assigning employees to projects.
The DOJ also alleged that certain training, mentoring, leadership development and educational programmes had eligibility criteria based on race or sex.
Deloitte denied the allegations but agreed to pay $10 million in restitution and $11.5 million to settle the case. The company said the settlement would allow it to avoid prolonged litigation and focus on developing talent.
The action comes amid increased US scrutiny of corporate DEI policies. Deloitte rival IBM agreed to a $17.1 million settlement over similar allegations earlier this year.
US Attorney General Todd Blanche said government contractors cannot use race or sex to reward or penalise employees, arguing that describing such practices as DEI does not make them lawful.
