IBM has agreed to pay ₱960 million to settle allegations by the U.S. Department of Justice (DOJ) over illegal diversity, equity, and inclusion (DEI) practices. The settlement reflects the continuation of a crackdown on DEI programs that began under President Donald Trump. His administration dismantled federal DEI offices, restricted race- and sex-based criteria in government contracting, and issued an executive order prohibiting “divisive” DEI training among federal contractors. These actions laid the foundation for the DOJ’s current enforcement strategy.
The DOJ accused IBM of making false claims about its hiring and promotion practices in federal contracts. Instead of focusing on qualifications, the company allegedly used race and sex-based goals, creating a discriminatory hiring system under the guise of diversity. “Racial discrimination is illegal,” said Acting Attorney General Todd Blanche. “Government contractors cannot evade the law by repackaging it as DEI.”
IBM denied any wrongdoing but chose to settle the case without admitting liability. The company’s spokesperson insisted that their workforce strategy focuses on “the right people with the right skills.” However, the settlement marks a step back for DEI advocates and signals growing resistance against identity-based hiring practices.
This case is part of a broader crackdown on DEI policies initiated during the Trump administration. The DOJ’s Civil Rights Fraud Initiative, built on Trump’s push for merit-based opportunity, uses the False Claims Act to challenge companies accused of embedding unlawful DEI mandates in their federal contracts. IBM, as a government contractor, became a key target of this effort.
The settlement underscores the need for merit-based hiring free from race and sex quotas. Critics of DEI practices argue that they foster division, not equality. For supporters of Trump’s policies, this case validates his administration’s push to restore fairness and opportunity based on skills rather than identity.
