On a recent episode of Stanford Legal, guest Professor Ralph Richard Banks explained how recent executive orders from President Trump have shined a spotlight on the disparate impact doctrine, one of the most consequential doctrines in civil rights law. Banks, the Jackson Eli Reynolds Professor of Law and faculty director of the Stanford Center for Racial Justice, joined host Pamela Karlan, the Kenneth and Harle Montgomery Professor of Public Interest Law and co-director of the Supreme Court Litigation Clinic, for a deep dive into how the disparate impact doctrine really works, why it matters, and what’s at stake when it’s attacked in the name of “meritocracy.”

From the landmark Griggs case to modern college admissions, Banks dissects the arguments, showing how this legal doctrine not only helps root out discrimination, but can also strengthen, rather than undermine, meritocracy.

The following is a shortened, edited version of the podcast transcript. Listen to the full podcast here.

Click here to read Professor Banks’ recent essay Reassessing Disparate Impact.

Karlan: A slew of executive orders from President Trump have repudiated or reversed course on decades-long practices and policies. The order titled Restoring Equality of Opportunity and Meritocracy rejects a legal theory known as disparate impact, which, for more than half a century, has been a key piece of anti-discrimination law in the United States. Disparate impact theory as a way of thinking about anti-discrimination law traces back to a case called Griggs v. Duke Power that the Supreme Court decided in 1971. Can you tell us a little bit about the case and what the Supreme Court did?

Banks: We need to understand this doctrine in its historical context because many of the Trump administration’s executive orders reject certain ideas wholesale that, in fact, have some virtues. At the same time, that doesn’t mean there are no vices in these doctrines, including disparate impact. In Griggs v. Duke Power Co., the Supreme Court issued a landmark ruling on what plaintiffs must show to prove discrimination. The defendant, North Carolina’s Duke Power Company, had openly discriminated against African American employees before the 1964 Civil Rights Act: white employees got the good jobs, Black employees did not.

After the Act’s passage, the company began assigning jobs based on intelligence tests and diploma requirements. Unsurprisingly, given the state of education for African Americans in North Carolina at the time, Black applicants did not score well. So they sued. The Court held that the IQ test and diploma requirements could be challenged based on the outcomes they produced. In other words, plaintiffs didn’t need to show that the company intentionally discriminated or adopted the policies to limit opportunities for Black employees. Merely the evidence of disparate outcomes was enough—as the first step—to allow the plaintiffs to get into court.

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Karlan: That a company would like people to have high school diplomas before they work for them doesn’t seem invidious in any way. But for years and years, the company had hired janitors who didn’t have high school diplomas and had hired secretaries who didn’t have high school diplomas, and so forth. You have argued that disparate impact helps smoke out intentional discrimination. People can adopt what looks like a neutral rule, but in reality it’s designed to make it harder for minority groups, women, or others to get the job or benefit. It’s like the old “grandfather clause” laws: on their face, they simply said you could vote if your grandfather could vote as of 1866. They didn’t mention race—but everyone understood they were meant to disenfranchise Black voters.

Banks: The Trump executive order rests on the assumption that the only purpose of the disparate impact doctrine is to try to mandate equal outcomes across groups. But of course, there’s another purpose, which, in fact, is probably the central purpose, at least historically. Disparate impact has been used to try to smoke out covert forms of discrimination where we don’t have obvious evidence of intent. And when you think about it, that kind of discrimination, once the Civil Rights Act was passed, became the dominant form of discrimination. Institutions knew they could no longer openly discriminate, so they tried to do so covertly.

Interestingly and ironically, the Trump administration’s attacks on higher education and other institutions has actually resorted to disparate impact or quasi-disparate impact approach whenever the administration says, for example, “We think that people are discriminated against based on their ideology or conservatives are being banished from academia and so we want the data.” Whenever they ask for the data and they want to look at the outcomes, they’re actually undertaking a disparate impact-sort of analysis. It is unclear to what extent administration officials realize this is what they’re doing.

The other piece, of course, is that in order to make out a disparate impact claim, it has to be the case that the employer doesn’t have an important, legitimate reason for why they have the challenged practice in place. In other words, if the employer can show that the reason they have a particular testing requirement is that the test has been shown to actually predict performance on the job, then the disparate impact claim will fail.

Karlan: Yes, that’s what’s sometimes referred to as the business necessity difference. The Trump executive order says that disparate impact theory means that a near insurmountable presumption of unlawful discrimination exists where there are any differences in outcomes in certain circumstances, even if there’s no policy, and even if everyone has an equal opportunity to succeed. But, of course, there is not a near insurmountable presumption. That’s not the case at all.

Banks: Yes, there are aspects of the order which, to put it simply, are misstatements of the law. But people don’t understand that these are misstatements of the law, and so disparate impact can easily be vilified as this “club” that some plaintiffs are using to enforce equal outcomes no matter what. But that’s not in fact the way it has worked in practice. The order is couched and framed in terms of legal doctrine, but in fact, the executive order, to say the least, doesn’t accurately track the doctrine or judicial decision-making. But executive orders are a place where the culture wars are fought. And outside the courts, yes, there are people on the far left–commentators and the like—who are arguably advocating for that view—that all outcomes need to be equal. 

The Trump administration wants to show that it’s against those who are pushing for equity or equal outcomes, or anti-racism, whatever the term is. In the process of doing so, though, it clearly misstates the law, and I think what’s most unfortunate here is that if we really got rid of the disparate impact doctrine, it would actually sacrifice meritocracy, which is what, and that’s what the Trump administration says it wants.

Karlan: Disparate impact helps us ask whether a test or hiring criterion truly has merit—or whether there’s a better way to find the best employees or students without disproportionately excluding minority groups, women, or people of certain religions. Take some of the old requirements for police or firefighters. Many departments had minimum height and weight standards, which disproportionately screened out women. Strength tests for firefighters had the same effect. These weren’t adopted to exclude women—they reflected the intuition that “bigger and stronger is better.” But in practice, there are many ways to be an effective police officer, and not all involve being physically intimidating. Skills like de-escalation, listening, and building trust are just as critical. Disparate impact theory forced departments to rethink those criteria, and when they did, they found ways to maintain effectiveness while hiring more women and more men from ethnic groups that tend to be shorter or lighter than average.

The Trump administration frames disparate impact and meritocracy as opposites. But you’re saying they don’t have to be in tension—how so?

Banks: This is an important point. Rather than being a tool to promote equal outcomes no matter what, disparate impact might instead be better understood as a doctrine that nudges employers toward best practices that embody a norm of meritocracy—that help them to hire the best employees when, for a variety of reasons, they might not do so on their own. That’s what Trump purports to want. The reality is that the 1964 Civil Rights Act was a pro-meritocracy development because it opened up opportunities for people from all backgrounds and it nudged employers toward doing good things, which we now take for granted, such as posting jobs openly and selecting from a broad pool of applicants. Think about the famous “riverboat” case, Kotch v. Board of River Port Pilot Commissioners, which concerned how people could become captain of a riverboat. Essentially, you had to be the son or the nephew of a captain—it was sheer nepotism, which everyone likely would agree is anti-meritocratic. Passing jobs along to relatives was the way it worked in many contexts for a long time and disparate impact is one of the many legal tools that have helped to break up that system.

Karlan: You have a book coming out this year titled The Big Sort, which is about colleges and college admissions. When colleges admit students, is that a meritocratic system? And what would it mean to say it is or it isn’t?

Banks: Meritocracy, in principle, is a good thing. Sometimes that gets lost in our culture war. The idea of hiring the best people for the job, the idea of recognizing talent and hard work and having that determine one’s outcome in life rather than pedigree or lineage. That’s part of what the modern world is and should be about. But it’s also the case that not every embodiment or instantiation of meritocracy is what we should embrace. We also need to think about what the effects of the system are in a broad sense, both for individual students, institutions, and also for society. One of the things I do in the book is sort out these issues in some detail.  

Karlan: It is a complicated question when we think about merit as it relates to 17-year-olds and letting them into a highly selective university. Should we let in the people who are the smartest? Is it we should let in the people who we think will be the best leaders going forward? Should we be thinking about the extent to which letting them into our school rather than letting them go someplace else will make the biggest change? If you think about merit as a form of deservingness, should it be the people who’ve overcome the most hurdles? And yet huge numbers of universities, including a number of public universities, give preference to children of the faculty, children of alums and the like. How should we be thinking about this when we think about disparate impact?

Banks: Having this conversation about universities, and the role of universities in society, is timely and important. I don’t think it’s an overstatement to say that the health of our society in the future will depend on the health of its universities, in particular the research universities. Too often in public debate, the issues are addressed in a crude, black or white sort of manner, and the nuances completely get lost. What we need is a discussion that has more nuance, where we recognize that meritocracy, for example, has important virtues, but it also has vices. 

Karlan: In your essay you point out that there is a disparate impact to a lot of the standardized tests that universities use in their admissions process. On the other hand, eliminating those tests might also have a huge disparate impact.  

Banks: There are many critics of standardized testing, with the assumption that eliminating admissions tests would make the process fairer. But if you don’t rely on tests, you rely on something else—which may be even more skewed by race or class. That’s one key point in the debate. Another, often overlooked, is that test scores are predictive: imperfectly and not for every applicant, but they do help forecast future performance. That’s the bind. We have tests that produce disparate outcomes, yet they remain useful in important ways.

Ralph Richard Banks is the Jackson Eli Reynolds Professor of Law at Stanford Law School and a professor, by courtesy, at the Stanford Graduate School of Education. He is the Founder and Faculty Director of the Stanford Center for Racial Justice, an initiative that aims to confront and counter the polarization that plagues American society through an analysis of contentious racial issues free from the orthodoxies of Left and Right. His forthcoming book, The Big Sort: How College Can Make or Break the American Dream, will be published in 2025.

Professor Banks is the co-author of two leading law school casebooks, Racial Justice and the Law: Cases and Materials (2016) (with co-editors Kim Forde-Mazrui, Guy Uriel Charles and Cristina Rodriguez) and Family Law in a Changing America (2nd ed. 2024) (with co-editors Douglas NeJaime, Joanna Grossman, and Suzanne Kim). He is also the author of the trade book Is Marriage for White People? How the African American Marriage Decline affects Everyone (2011; paperback 2012), described by the Los Angeles Times as a “must read,” by the New York Times as “important” and by the Wilson Quarterly (the official publication of the Woodrow Wilson International Center for Scholars) as one of the Top Ten Books of 2011. The book has been featured by a wide range of media outlets, including The Wall Street Journal, The Economist, Essence magazine, The Village Voice, Time, Newsweek/The Daily Beast, and also NPR (local and national) CNN, ABC News/Nightline, The View, and Fox News, among many others.