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Valid Testing Lowers the Risk of Discrimination Suits

Posted by Michael D. Haberman

valid testing

What is the purpose of an employment test? The answer: to reduce the number of candidates for a position, thus making the selection process more manageable. Unfortunately, using an improper test will potentially make the process more biased and put the organization using the improper test at risk for litigation if the test is proven unreliable. “Tests”, be they cognitive tests or tests of physical ability, can be used, and have been used, to screen candidates out of a position. The Equal Employment Opportunity Commission (EEOC) has guidelines requiring tests, and also interviews, be both valid and reliable. This means that a test needs to actually test what it claims to be testing, and it has to do so time after time. The test must also be job-related and cannot be something selected on someone’s whim. This means each test must be “properly validated” as “job-related” and “consistent with business necessity” under the Uniform Guidelines on Employment Selection Procedures (UGESP), according to attorneys Katharine H. Parker and Daniel L. Saperstein, writing for Lexology.com.

They summarize a suit, filed by the EEOC, against an assisted living facility that did not follow these guidelines and used a test that had an “English as a Second Language (ESL) component” that discriminated against Africans on the basis of their national origin. Additionally, the EEOC maintained the company did not conduct a job analysis to ensure the test measured essential functions related to the job. The company was unable to prove that a written test they had given as part of a training course had any relation to the essential skills required for a personal care provider, the job for which the test was given.

Another such case was brought against the Ford Motor Company. According to The EmpLAWyerologist Blog, Ford used a cognitive test to measure “verbal, numerical and spatial reasoning, purportedly to evaluate mechanical aptitude.” Though Ford had this test independently validated, it “consistently excluded a disproportionate number of African-American applicants.” The EEOC showed that another test was available that met the needed job standards and did not have a discriminatory effect on African-American candidates. Ford’s refusal to use this other test cost them $8.5 million in fines.

Pre-employment tests, conducted under the right circumstances, can help provide an enhanced perception of objectivity. However, they must meet the standards of non-discrimination put forth in the Uniform Guidelines. Unfortunately for Ford, the test they used failed to meet that standard.

Employer Best Practices for Testing and Selection

The EEOC has published useful guidelines and best practices. These include:

  • Employers should administer tests and other selection procedures without regard to race, color, national origin, sex, religion, age (40 or older), or disability.
  • Employers should ensure that employment tests and other selection procedures are properly validated for the positions and purposes for which they are used. The test or selection procedure must be job-related and its results appropriate for the employer’s purpose. While a test vendor’s documentation supporting the validity of a test may be helpful, the employer is still responsible for ensuring that its tests are valid under UGESP.
  • If a selection procedure screens out a protected group, the employer should determine whether there is an equally effective alternative selection procedure that has less adverse impact and, if so, adopt the alternative procedure. For example, if the selection procedure is a test, the employer should determine whether another test would predict job performance but not disproportionately exclude the protected group.
  • To ensure that a test or selection procedure remains predictive of success in a job, employers should keep abreast of changes in job requirements and should update the test specifications or selection procedures accordingly.
  • Employers should ensure that tests and selection procedures are not adopted casually by managers who know little about these processes. A test or selection procedure can be an effective management tool, but no test or selection procedure should be implemented without an understanding of its effectiveness and limitations for the organization, its appropriateness for a specific job, and whether it can be appropriately administered and scored.

Meeting these standards will help ensure that the test you are using as a selection device will meet the standards of the EEOC and help you avoid fines like Ford incurred.

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Consequences of Other Discriminatory Hiring Procedures

Other parts of the hiring process may also show discriminatory trends. The consequences of not using valid tests can be very expensive, as Ford found out. But it can also cost companies other ways as well. Marisa Kendall of the Los Angeles Times reported that Palantir, a Silicon Valley company that specializes in big data analysis, agreed to pay $1.7 million to settle a government lawsuit alleging racial discrimination against Asian applicants during the résumé review and telephone interview phases of the hiring process. Palantir maintains it did not discriminate but settled quickly to avoid losing its government contracts, which would have cost the company millions of dollars beyond the settlement.

Steps to Avoid Problems

An employer can do a number of things to protect itself in the use of selection tests. These include:

  1. Do a good analysis of the job to determine its essential functions and the skills necessary for the job.
  2. Work with a test vendor, eSkill for example, and find the right selection device to find the best candidates.
  3. If an adverse impact exists, determine if a better, less discriminatory selection tool can be used.
  4. If the test you use turns out to be the best available and it still has a discriminatory effect, then understand the business reason and be prepared to defend it.

Just because adverse impact exists does not mean a pre-employment testing tool cannot be used–it means that its use has to be defensible. Having good validation from a trusted test vendor will help greatly with that defense.

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About Michael D. Haberman

Author

Michael D. Haberman is Vice-President and co-founder of Omega HR Solutions, Inc., a consulting and services company offering complete Human Resources solutions. As the former founder and President of MDH Consulting, a Human Resources consulting firm, Mike has more than 35 years of experience in Human Resources, and he uses his broad-based background to help companies solve employee problems and deal with governmental compliance.

3 COMMENTS Join the discussion
  • Jan August, 30, 2017

    Do not allow test results alone to disqualify an applicant or to be a determining factor in a decision to not hire. Instead, use test results in combination with traditional hiring methods, such as résumés, job applications, references, and in-person interviews. This creates a holistic view of a candidate’s qualifications.

  • Roger B. August, 30, 2017

    Implementing a valid testing process can be time-consuming, but the wealth of information gleaned is worth the effort.

  • Matilda August, 30, 2017

    Before posting any position, HR should identify pertinent employment laws and customs and work with legal counsel to develop a strategy that addresses the legal parameters and practical constraints of administering a skills testing program for that job.

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Guest August, 30, 2017