EMPLOYEE TESTING ON TRIAL

Many employers use objective test results or other data as part of their hiring and promotion process. Often the tests and screening procedures used include cognitive or personality tests, medical exams, credit checks, and criminal background checks. While these tools may be effective for identifying the most qualified candidate, they are not without risk. There are general legal restrictions on the use of employment testing (whether pre- or post-employment) in addition to the general prohibitions on discrimination found in Title VII. The Uniform Guidelines on Employee Section Procedures prohibits the use of a test or selection process that has an adverse impact on individuals in a protected class unless the test has criterion-related, content and construction validation studies. The validation studies must consist of empirical data demonstrating that the test: (1) is predictive of performance of important elements of job performance; (2) contains content which tests important aspects of performance on the job; and (3) consists of procedures that assess identifiable characteristics that have been determined to be important to job performance.

The EEOC at Work in the Field

Recently, two significant cases have reminded employers that if they use a screening test in a way that causes it to disproportionately impact a protected class, the test may later be challenged as discriminatory. In late 2006, a federal appeals court upheld a $3.3 million award to 52 rejected female job applicants who were not hired because they could not pass a pre-employment "strength test." The EEOC pursued the case on behalf of the alleged discrimination victims, claiming the test had a disproportionate and unlawful impact on women. The court agreed with the EEOC even though it also recognized that the strength test reduced the number of job-related injuries and appeared to be instituted as part of a plan to reduce time loss and worker's compensation costs, both of which are non-discriminatory business considerations. The problem for the company was that its test was considerably more difficult than the job required and thus screened out candidates who could still meet the physical requirements of the position. Because there was another option for screening candidates that would have had a less significant impact on women, i.e., decreasing the minimum weight used for the strength test, the employer could not show business necessity, and its justification was therefore rejected. EEOC v. Dial Corp., No. 05-4183 (8th Cir. 2006).

Similarly, in late 2007, Ford Motor Company agreed to settle the second of two race discrimination claims pursued on behalf of African-American employees by the EEOC. The 2005 settlement was $8.5 million and the 2007 settlement was an additional $1.6 million. In both cases, the EEOC claimed that a written test used by Ford to determine the eligibility of hourly employees for a skilled trades apprenticeship program had a disproportionately negative impact on African-Americans. The company contended that its cognitive test was designed to measure verbal and spatial reasoning in order to evaluate mechanical aptitude and was therefore valid. The problem for Ford was its inability to validate the test in a way that conformed with The Uniform Guidelines on Employee Selection Procedures and to show that there was no other alternative available that did not have such a dramatically negative impact on minority employees. EEOC v. Ford Motor Company.

The EEOC at Work Inside the Agency

Apart from the EEOC's clear litigation focus on large employers' screening practices, the agency further reinforced its concern about testing through the issuance of its Employment Tests and Selection Procedures Fact Sheet and Best Practices. Employers who use any form of testing or objective evaluation process will want to review their practices and ensure that they are in compliance with the EEOC's new guidelines:

• 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 also consider the additional protected classes that may exist under their State anti-discrimination law. In Oregon this includes age (18 or older), marital status, and sexual orientation.
• Employers should ensure that employment tests and other selection procedures are properly validated for the positions and purposes for which they are used. What is most important is that the test or selection procedure must be job-related and its results appropriate for the employer's purpose. Tests or selection procedures that are overly harsh may be subject to challenge. For example, consideration of arrest history is generally too remote and speculative to predict success on the job and may create an adverse impact for minority applicants. By contrast, consideration of felony convictions is clearly a better predictor of success and will have little or no disproportionate impact on applicants in a protected class.
• Employers should evaluate the results of a selection procedure. If it screens out a protected group at a disproportionate rate, the company should explore 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.

Summing it Up

Employers should ensure that when they implement a test or procedure, they have a clear understanding of its effectiveness and impact on the organization and its employees, its suitability for a specific job, and whether there are less discriminatory tests or procedures they can use. If you have implemented or are considering implementation of a screening test or procedure and have concerns, contact your employment law attorney. Dunn Carney's experienced employment law attorneys work with employers to navigate through the new EEOC guidelines and anti-discrimination laws.

Thank you to Kelly J. Martin for contributing to this article.

Employment and Labor Law Team

Leader: Tamsen Leachman
Bob Allen
Tim Bernasek
Jack Cooper
Elizabeth Knight
Kelly Martin
Renee Stineman