Microsoft faces down criticism after laying off DEI team

Company says it’s due to ‘changing business needs’

Microsoft has laid off an internal team which focused on diversity, equity and inclusion. It’s part of a wider trend.

After Microsoft included its DEI team in its latest round of job cuts, a team leader spoke out in an email sent to thousands of employees and seen by Business Insider.

"True systems-change work associated with DEI programs everywhere are no longer business critical or smart as they were in 2020," a leader of the team wrote in an email sent to thousands of employees, which was viewed by Business Insider.

The email says the team was eliminated because of "changing business needs" as of July 1.

Most of the tech giants and enterprise tech more broadly made public commitments to improve the diversity of their workforces and leadership in the wake of the murder of George Floyd by a police officer and the waves of public anger that it generated in the US. The horror at the sheer brutality was felt at a global level.

Big Tech sensed a moment and in 2020, Microsoft pledged to double the number of Black and African American leaders within the company by 2025. The pledge also committed to investing $150 million over five years in DEI programmes.

"Our D&I commitments remain unchanged," a Microsoft spokesperson, Jeff Jones, said in a statement. "Our focus on diversity and inclusion is unwavering and we are holding firm on our expectations, prioritizing accountability, and continuing to focus on this work."

Microsoft is far from alone in abandoning DEI efforts, or indeed in issuing statements of their heartfelt commitments to diverse workforces at the same time as the redundancy notices are being posted.

Zoom cut its DEI team earlier this year and Google and Meta have done likewise.

Settling for failure

Microsoft is an interesting case study in corporate DEI efforts. When the company made its pledge in June 2020 on doubling the number of Black leaders, it triggered an investigation by the US Labour department for potentially violating the Civil Rights Act.

A letter from Craig Leen, Director of the Labor Department's Office of Federal Contract Compliance Programs said:

"Although contractors must establish affirmative action programs to set workforce utilization goals for minorities and women based on availability, contractors must not engage in discriminatory practices in meeting those goals."

Microsoft's pledge "did not reference any established goals in an affirmative action program, and appears to imply that employment action may be taken based on race," Leen said.

Following this, the company, in a blog post, said, "The letter asked us to prove that the actions we are taking to improve opportunities are not illegal race-based decisions. Emphatically they are not." You can read the full post here.

Running parallel to these events was another set of allegations of race discrimination against Asian, African American and Hispanic applicants for roles at Microsoft. That ended with Microsoft paying out $3m in back-pay and agreeing to review its hiring practices.

At the same time the Trump administration issued an executive order prohibiting government contractors such as Microsoft from providing specific forms of racial or other diversity training programmes.

Whether or not Microsoft has met its pledge of June 2020 is unclear. However a clue about the direction of travel can be found in another settlement announced earlier this month between Microsoft and the California Civil Rights Department, this time worth approximately $14m. The settlement is to resolve allegations made by Microsoft employees that when they exercised parental, disability, pregnancy and/or family care leave they faced retaliation and discrimination as a consequence.

Examples of this discrimination offered were lower bonuses and poor performance reviews which subsequently limited the employees' eligibility for merit increases, stock awards, and promotions. Women and people with disabilities were overrepresented in the employees taking this action.

Microsoft, along with the rest of Big Tech, made some very worthy pledges in 2020. But whilst the words said one thing, the deeds showed another.