Bryan Baldwin State of Washington Department of Personnel May 3, 2006

1. Creating Defensible Selection Procedures Bryan Baldwin State of Washington Department of Personnel May 3, 2006 IPMA-HR Western Region Annual Training Conference

2. Defensible Selection Overview/Objectives By the end of today, you will know: • What hiring practices can be challenged. • What you are defending against. • What the relevant laws are. • What is meant by “validity.” • Why we should care about good selection. • What you can do to help ensure defensibility.

3. Defensible Selection “Selection Procedure” • Uniform Guidelines on Employee Selection Procedures: • “Employment decisions include but are not limited to hiring, promotion, demotion, membership…referral, retention, and licensing and certification…Other selection decisions, such as selection for training or transfer, may also be considered employment decisions…” • Connecticut v. Teal (1982) • Professional guidance • APA Standards • SIOP Principles • Bottom line: Anything that narrows the talent pool

4. Defensible Selection Why do we spend so much time on assessment? • Increases productivity of workforce • Helps prevent errors from being made • Increases employee satisfaction and reduces turnover • Better fit • Processes are more consistent and fair • Improves organization’s reputation • More attractive as employer • Helps ensure we treat people fairly

5. Defensible Selection It’s not just about defensibility “Many lawyers think of test validation studies as just a bunch of paperwork that benefits no one but the psychologists…The cost of test validation is normally insignificant compared to the benefits received, and these benefits continue for each year that the test is used—and beyond, to the extent that employees selected by the test remain on the job.” - Seberhagen (1990)

6. Defensible Selection What are we defending against? • Discrimination complaints • Disparate treatment • Disparate/adverse impact • Privacy violations • Improper medical tests • Negligent hiring/failure to perform due diligence • Violations of merit system rules • Violations of bargaining contracts

7. Defensible Selection “Defensible” • Withstands scrutiny from: • Applicants/candidates • Peers • Union representatives • Regulatory agencies • Attorneys • Jury • Judge • Something you could stand behind • Something you wouldn’t mind seeing in the paper

8. Defensible Selection The Laws • Title VII • Section 1981/1983 • ADEA • ADA and Rehabilitation Act • USERRA and VEVRAA • FCRA • Immigration Reform and Control Act • Executive Order 11246 • State and local laws • Employment torts

9. Defensible Selection Regulatory Agencies • Equal Employment Opportunity Commission (EEOC) • U.S. Department of Justice (DOJ) • U.S. Department of Labor (DOL) • OFCCP • VETS • Federal Trade Commission (FTC) • U.S. Department of Homeland Security • State agencies, for example: • California Department of Fair Employment and Housing • Washington Human Rights Commission • Oregon Bureau of Labor & Industries • Local agencies

10. Defensible Selection “Internet Applicants” • New OFCCP regulations • Cover certain federal contractors • Require collection of demographic information • Require tracking of database searches • Require qualifications to be job-related • Should be thoroughly reviewed by covered employers • Pending EEOC regulations (UGESP Q&A) • Will the final version mirror OFCCP regulations? • Applies to more employers

11. Defensible Selection Disparate Treatment • Inconsistent/unfair application of policy or procedure • Employer must give a job-related, legal reason why they did what they did • Plaintiffs and judge/jury will look for any situations where you treated “similarly situated” individuals differently • Serious liability for organization and, in some cases, the individual

12. Defensible Selection Disparate/Adverse Impact • Policy/practice applied same way to all groups but has the effect of discriminating against some • Classic examples: diplomas, height • Common measure: “4/5ths rule” • Employer must show selection process was job-related and consistent with business necessity • Court/jury will look for evidence of validity per the Uniform Guidelines

13. Defensible Selection Exceptions • Bona Fide Occupational Qualification (BFOQ) • Religion, sex, national origin, or age only • Must be “reasonably necessary to the operation of that particular business or enterprise” • Bona Fide Seniority System (BFSS) • Affirmative Action • Diversity can be a compelling interest • AA must be narrowly tailored to achieve goals • Race/ethnicity can be considered a “plus” only • Can take many forms

14. Defensible Selection Why do applicants complain? • They perceive a violation of Title VII of the federal Civil Rights Act of 1964 as amended in 1991 • The exam didn’t pass the smell test (wasn’t “face valid”) • They feel they weren’t treated fairly • They’ve heard other applicants felt the same • They like to complain

15. Studies have linked procedural justice to: • Recommending the employer to others • Perceptions of fairness • Applicants’ intention to take a job • Organizational attractiveness • Turnover intentions • Filing complaints Defensible Selection Procedural Justice Procedural justice – the fairness of the process used to select applicants/new hires (not the result)

16. Defensible Selection Applicant Perceptions InstrumentFavorability Rating Interviews Higher Work sample Resumes References Cognitive ability Personality tests Biodata Honesty tests Lower Source: Hausknecht et al. (2004)

17. What is “validity”? Defensible Selection

18. Defensible Selection Sources of Validity Uniform Guidelines: “The 3 C’s”: • Relationship between scores and job performance • “Criterion-related validity” • Test content matches job content • “Content validity” • Test is measuring abstract concept (dependability) • “Construct validity” • Validity generalization

19. Defensible Selection Validity Evidence “The closer the content and the context of the selection procedure are to work samples or work behaviors, the stronger is the basis for showing content validity. As the content of the selection procedure less resembles a work behavior…the less likely the selection procedure is to be content valid, and the greater the need for other evidence of validity.” – Uniform Guidelines, 14(C)(4)

20. So how often do these lawsuits happen, anyway? Defensible Selection

21. Defensible Selection Charges in 2005 (thousands) Source: EEOC

22. Defensible Selection 2005 EEOC Charges Filed by Type Source: EEOC

23. Ehh..what’s the worst thing that could happen? Defensible Selection

24. Defensible Selection Potential Penalties • 1. Equitable relief • Hiring, reinstatement, back pay, legal fees, etc. • Adverse impact or disparate treatment • 2. Legal relief • Compensatory damages, e.g., pain and suffering • Punitive damages: to punish the employer • Available only against private sector employers • Available only in disparate treatment cases • May not be available for violating state laws (e.g., AZ) • 3. Limits • Title VII, ADA, ADEA: see next slide • State laws vary (e.g., unlimited in CA civil case) • Section 1981 and 1983: unlimited

25. Defensible Selection Title VII, ADA, and ADEA

26. $ $ $ $ $ $ $ But validation is so expensive! Average cost of content validation: $5-20K Median settlement in discrimination case, ’96-’02: $50-70K Median 2003 compensatory award in discrimination case: $232K Defensible Selection Sources: Seberhagen (1990); Jury Verdict Research

27. Defensible Selection First…reality • No selection system is perfect • Someone can always complain

28. Defensible Selection How to Protect Yourself • Job analysis, job analysis, job analysis “People will continue to measure the wrong things as long as they fail to define what they want to measure.” - Guion (1998)

29. Defensible Selection KSA-Selection Method Matrix

30. Defensible Selection • 2. Use “good” exams • Based on results of job analysis • Reliable • Valid • Structured • Free of obviously illegal questions • Weighted according to the job analysis • Bias for work sample/performance tests • Beware on-line tests—especially personality tests

31. Defensible Selection What works? Supervisors’ Opinion Validity Sources: Schmidt & Hunter (1998); Roth et al. (2005); Aamodt (1998); U.S. MSPB (2005)

32. Defensible Selection Looking in the mirror Study of 959 HR professionals QuestionAnswer% Wrong 1. The most valid employment interviews are designed around each candidate’s unique background. 2. Although people use many different terms to describe personalities, there are really only four…as captured by the Myers-Briggs Type Indicator (MBTI). 3. Being very intelligent is actually a disadvantage for performing well on a low-skilled job. 4. “Integrity tests” don’t work well in practice because so many people lie on them. 5. Companies that screen job applicants for values have higher performance than those that screen for intelligence. Source: Rynes et al. (2002)

33. Defensible Selection Adverse Impact d-value Sources: Several, including Aamodt (2006), Roth et al. (2001), and Hough et al. (2001)

34. Defensible Selection • Focus in-depth validation on certain jobs first • Do not rely on one method of assessment—use a “whole person” approach • Minimize the reading level • Document, document, document

35. Defensible Selection Documenting the Selection Process • Job analysis and critical behaviors/KSAs • Decision process for choice of selection methods • Selection method(s) development or purchase • Rating scales and benchmarks • Recruitment activities • Applicant responses (can summarize) • Reference/background check information • Final selection process • Record retention period: Varies • Recommend three years

36. Defensible Selection • Train and be trained • Hiring supervisors • Staff • Candidates • Be consistent & courteous with your applicants • Establish & follow clear policies & procedures • Establish an exam review procedure

37. Defensible Selection 11. “Sell” your exam to applicants 12. Pre-test 13. Look at your SMEs 14. Do background and reference checks

38. Defensible Selection Background and Reference Checks • Background checks are database checks • Reference checks are real-time interviews • Check personnel files when available • Obtain a release • Give yourself enough time

39. Defensible Selection Background Checks • Examples: • Criminal background checks • Credit checks • Educational/employment verification • Driving record • Be very wary of using arrest records to deny job • Analyze conviction records—no blanket policies • Tie denial of employment to nature of job • Follow requirements of the FCRA and other laws • May be required for certain jobs (check laws) • Not to be undertaken lightly

40. Defensible Selection Reference Checks • Do them as part of your due diligence • Ask job-related questions • Ask follow up questions • Use a standard form • Consider assigning to specialists • Document questions and answers • Off-list checks

41. Defensible Selection • Provide candidates enough time • Keep an eye on things – ongoing evaluation • Periodically audit your examination process • Set your pass points systematically

42. Defensible Selection Where do we set the pass point? “[cutoff scores]…should normally be set as to be reasonable and consistent with normal expectations of acceptable proficiency within the work force.” - Uniform Guidelines on Employee Selection Procedures (1978) “[cutoff scores should be] reasonable and consistent with normal expectations of performance.” - Craig v. County of Los Angeles (1980, 9rd Cir.) “…under [the Civil Rights Act] a discriminatory cutoff score on an entry level employment examination must be shown to measure the minimum qualifications necessary for successful performance on the job.” - Lanning v. SEPTA (1999, 3rd Cir.)

43. Defensible Selection • Check immigration status • Must verify authorization to work in U.S. • Penalties for non-compliance can be steep • Estimates of unauthorized workers up to 30% in some industries (e.g., construction) • Consider applicant privacy and medical testing issues

44. Defensible Selection Privacy Violations • Polygraph tests • Public entities often exempt from laws (esp. police) • Be very wary of relying on them • Personality tests (e.g., Target, Staples cases) • Drug testing • Generally supported if administered to all applicants • Tie to job responsibilities (e.g., operates vehicle) • Safer for applicants than current employees • May be required for some jobs (e.g., transportation) • Current use v. rehabilitated addicts & alcoholics • Criminal/credit history • Follow requirements of the FCRA • Be aware of state/local laws

45. Defensible Selection Improper Medical Tests • Pre-employment questions • “Are you able to perform the essential functions of this job, with or without reasonable accommodation?” • EEOC definition of medical test • Medical inquiries/tests must come after job offer • Karraker v. Rent-A-Center (2005) • Miller v. City of Springfield (1998)

46. Defensible Selection • Use broad, inclusive recruitment strategies that target qualified applicants • Use standard applications, not resumes • Don’t ignore the Uniform Guidelines • Involve multiple stakeholders • When in doubt … seek help !!

47. How can I keep up on all these changes in the law? Defensible Selection Electronic newsletters • www.elinfonet.com • www.ahipubs.com • hr.cch.com • www.blr.com

48. Defensible Selection Resources/References • Links • Uniform Guidelines: www.uniformguidelines.com • OFCCP: www.dol.gov/esa/ofccp • EEOC: www.eeoc.gov • Recommended Reading • Testing and assessment: An employer’s guide to good • practices. Available at www.onetcenter.org/guides.html • 2. Gutman, A. (2000). EEO law and personnel practices. • 3. Brannick & Levine (2002). Job analysis. • 4. Guion, R.M. (1998). Assessment, measurement, and • prediction for personnel decisions. • 5. Rosen, L. (2005). The safe hiring manual.

49. Defensible Selection