IBM to Pay $17 Million Over Alleged DEI Discrimination in Federal Contracts
IBM has agreed to pay $17 million to settle a DOJ lawsuit accusing the company of using DEI policies — including a diversity bonus modifier and demographic hiring targets — in federal contracts. IBM cooperated with investigators and has modified or ended the contested programs as part of the settlement.
1. Settlement Terms
IBM agreed to pay $17 million to resolve allegations it violated federal anti-discrimination clauses by implementing DEI practices in its federal contracts. The settlement is the first resolution under the DOJ's Civil Rights Fraud Initiative and concludes potential civil liability.
2. Alleged DEI Violations
Investigators alleged IBM linked employee bonuses to demographic targets, set diverse interview slates, and imposed demographic goals on hiring, promotions, and training. These practices were deemed to sort or disadvantage individuals based on race, color, national origin, or sex.
3. IBM's Corrective Actions
IBM voluntarily disclosed findings from its internal review and took steps to modify or end the questioned programs, demonstrating cooperation with the investigation. The company aims to ensure future compliance and maintain eligibility for federal contracts.