“Certainly the state of South Carolina can have an anti-DEI policy for the state, but we don’t believe that the state should be coercing private business about how they handle their HR policies,” said Frank Knapp of the South Carolina Small Business Chamber of Commerce. “As long as HR and private businesses are not violating constitutional protections we just don’t need that. I mean, what’s next?”
The State
February 27, 2025
Any company that supports diversity can’t do business with SC under proposed law
By Ted Clifford
A pair of bills in the state General Assembly that broadly target diversity, equity and inclusion efforts in South Carolina are causing waves among South Carolina businesses because companies that work with state government would be required to pledge they do not have any such program.
The bills, called “Ending Illegal Discrimination and Restoring Merit-Based Opportunity Act,” would prohibit any part of the South Carolina government from promoting DEI policies. As part of that push, any entity receiving a contract or grant from the state must “certify that they do not operate any programs that promote equity, diversity, and inclusion.”
The bills, filed in the House and Senate, also require companies to ensure that their subcontractors do not employ any DEI policies.
“Certainly the state of South Carolina can have an anti-DEI policy for the state, but we don’t believe that the state should be coercing private business about how they handle their HR policies,” said Frank Knapp of the South Carolina Small Business Chamber of Commerce. “As long as HR and private businesses are not violating constitutional protections we just don’t need that. I mean, what’s next?”
The stated intention of the bills is to protect South Carolinians from discrimination through “illegal” diversity, equity, inclusion and accessibility programs. These programs have undermined national unity and key industries, including health care and aviation, according to the bill’s text.
“In case after tragic case, South Carolinians have witnessed first-hand the disastrous consequences of illegal, pernicious discrimination that has prioritized how people were born instead of what they were capable of doing,” according to the bill.
Its language and intention appears to mirror efforts by President Donald Trump to eliminate DEI policies at the federal level. In one of his first executive actions, Trump terminated the consideration of DEI criteria in federal contracts — a federal judge has since blocked part of that order.
But with 77 representatives — more than 60% of House members — signing on as sponsors, the bill is not a fringe piece of law.
The State has reached out to lead sponsors of the House bill, Rep. Leon “Doug” Gilliam, R-Union; Majority Leader David Hiott, R-Pickens; and Speaker Murrell Smith, R-Sumter.
The bills also prohibit any state agency from establishing or maintaining a DEI office or hiring outside contractors to perform DEI work. All hiring must be “color-blind and sex-neutral… in accordance with any applicable state and federal antidiscrimination laws.”
State agencies are also prohibited from conducting any trainings, programs or promoting any policies “in reference to race, sex, color, ethnicity, gender, or sexual orientation.”
And the bill prohibits any state institution, including schools, from requiring anyone enrolling to participate in a “training or program…. designed or implemented in reference to race, sex, color, ethnicity, gender, or sexual orientation.”
“I hope that people read the bill because it has wide ranging implications that a lot of the members don’t even think about and don’t even want discussed,” said state Sen. Tameika Isaac Devine, D-Richland. “But I think they have the numbers to pass it.”
What does this mean for South Carolina’s economy?
Carl Blackstone, the president and CEO of the, said the bills’ sweeping breadth is likely to only make things more difficult for small businesses. Half of all small businesses fail within three years, Blackstone said.
“Many of the businesses in South Carolina have a nuance, whether they are veteran owned or minority owned,” Blackstone said. “We need clarity from the legislature about the types of programs. Because we have a program that helps small businesses that have trouble getting access to capital, is that DEI?”
In recent years, South Carolina has enjoyed an economic flourishing. In 2023, South Carolina had the fourth highest net migration of any state. South Carolina’s gross domestic product grew 4.5% in the first half of 2024, and new industries, like data centers and electric vehicle manufacturer Scout, have been held up as proof of the state’s economic renaissance.
But laws compelling how companies, including major multinationals, govern internal culture could dampen the perception that the state is open for business, according to business leaders and policy makers.
“I think that we’re going to see a lot of things that people rely upon in this state shutting down in our state. It’s going to set out state back years, if not decades,” Devine said.
“I think this is going to have a significant impact on the economics in our state. I think we’re going to end up with an even more imbalanced system,” said Brenda Murphy, president of the South Carolina Conference of the NAACP. While women and people of color in South Carolina have made advances in terms of salary and opportunity, Murphy said this law would be part of a larger “rollback” of those gains even as state leaders are trying to encourage more people and businesses to move to the state.
“Our concern is really broader than DEI — this is just one of the symptoms,” Murphy said.
Were the bill to pass in its current form, the state should expect a challenge on First Amendment grounds, said Jay Bender, a Columbia media lawyer.
“The government cannot do indirectly what it cannot do directly, it cannot circumvent the constitution by having this provision in there,” said Bender, who has represented The State. “If I have a company and want to have training for employees that recognizes history or differential treatment for different categories of person, I have a right to do that.”
Will these bills pass?
The House’s version of the bill has been sent to the House Education and Public Works Committee, where Chairwoman Shannon Erickson told The State that she doesn’t have a timeline on when her committee will start work on the legislation.
“Have you seen the bill? It’s ginormous,” said Erickson, R-Beaufort. “It covers everything from soup to nuts. I will very carefully be collaborative, and I will very carefully have days for testimony before that moves. That’s something too big not to have some good talks about it and hear from the public.”
Were the bill to move forward, there is little that Democrats could do to stop the bills given that Republicans have a super majority in both houses.
Previous efforts to ban DEI initiatives from the floor have grounded the House budget debate to a halt. In order to prevent this, state Rep. Nathan Ballentine said he has proposed a budget proviso that would target DEI in a narrower manner than the bills.
Ballentine, R-Richland, said the bill uses a sledgehammer whereas he compared the proviso to using a scalpel.
“I think it will do things that will be unintended consequences that frankly we can’t do,” Ballentine said. “It sounds good to the public. People could run around and say they completely eliminated DEI but that will cause more problems than what it was supposed to do.”
Rep. Justin Bamberg, D-Bamberg, said that he believed many Republicans felt pressure to pass an anti-DEI bill because of the rhetoric of President Trump and his supporters, who had shifted state Republican parties further to the right.
“I wish more of them had the courage to stand up and say, ‘certain things aren’t right and and were not going to do that and if you’re going to say I’m not a Republican because of that then so be it,” Bamberg said. “It’s very weird that the pendulum has swung such that the Republican super majority is now the big government party.”
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