1) Subgroup Norming: Against the CRA of 1991

Ways to Reduce Adverse Impact

2) Banding: Randomly selecting individuals from bands (race-neutral banding) is legitimate to use. Race conscious banding is “iffy” but is best if protected-group status is used along with other factors (Bridgeport Guardians v. City of Bridgeport, 1991 & Officers for Justice v. Civil Service Commission 1992).

3) Alternate test or combinations of tests: Legal to use.

From Section 1607(3)(B) of the Uniform Guidelines.

Where two or more selection procedures are available which servethe user’s legitimate interest in efficient and trustworthy workmanship,and which are substantially equally valid for a given purpose,the user should use the procedure which has been demonstrated tohave lesser adverse impact.

Ways to Reduce Adverse Impact (cont.)Manipulating Test Content: Unsettled. Upheld in Hayden v. Nassau County

Case Summary: To reduce adverse impact, 16 components were eliminated, only 9 retained

Lawsuit filed by those claiming that they would have been hired if the full exam was used

2nd Circuit ruled in favor of the County, “the intent to remedy the disparate impact of prior exams is not equivalent to an intent to discriminate against non-minority applicants.”

Although race was taken into account in redesigning the exam, it was deemed to be “ scored in a wholly race-neutral fashion”

Hayden v. Nassau County

In 1982, Nassau County and the Department of Justice entered into a consent decree to develop an exam without adverse impact

Two failures, one in 1983 another in 1987 (adverse impact existed); Committee formed to construct a new exam

Committee developed a new test with 25 components (adverse impact was still found!)

Although the County “won” in Hayden, the findings need to be interpreted in light of:

• a history of past litigation (20 years worth)

• the influence of an existing consent decree with the DOJ

Hayden v. Nassau County (cont.)

Basic Facts From Ricci

• Tests for promotion of firefighters to Lieutenant & Captain developed using content validity strategy

• Tests results in adverse impact on Blacks & Hispanics

• Competitor to IOS (Hornick) testifies telephonically without ever examining test --- tells CSB IOS test is valid, but assessment centers result in less adverse impact

• Others testify ---5 hearings ---lots of political pressure

• 2-2 vote (1 abstention) by CSB ---test not certified & Hornick is hired to develop new tests

• 17 Whites & 1 Hispanic sue

Ways to Reduce Adverse Impact (cont.)

Discarding Test Results: (see Ricci v. DeStefano)

• Intent to remedy the disparate impact is not equivalent to an intent to discriminate against non-minority applicants

• Judge acknowledges that CSB decision to not certify is race conscious ---

• However, she rules it leads to race-neutral results because all exam results are discarded and nobody is promoted

District Court Ruling (Judge Arteton)

• 3-judge panel of 2nd Circuit issues short per curium ruling stating that Judge Arteton‟s ruling is well-reasoned & CSB is in unfortunate position of having no good alternatives

• 13 2nd Circuit judges vote 7-6 to not review Arteton‟s ruling en banc (when all the members of an appellate court hear an argument) --- 6 Dissenters urge SC to review Arteton’s ruling

Written test = 60%, Oral test = 40% (based on collective bargaining agreement)

• Reverse discrimination claim by 17 whites and 1 Hispanic who were not promoted

• Issue was whether the City, in order to avoid losing an adverse impact lawsuit, engaged in intentional discrimination by using race in its decision to not certify the tests

Ricci (cont.)

The City’s decision was motivated by race --- not certifying test results is illegal

“Whatever the City's ultimate aim--however well intentioned or benevolent it might have seemed--the City made its employment decision because of race. The City rejected the test results solely because the higher scoring candidates were white. The question is not whether that conduct was discriminatory but whether the City had a lawful justification for its race-based action.”

Strong-basis-in-evidence standard adopted by the Supreme Court

“For the foregoing reasons, we adopt the strong-basis-in-evidence standard as a matter of statutory construction to resolve any conflict between the disparate-treatment and disparate-impact provisions of Title VII”

– Good faith standard seen as too lenient– Certainty criterion viewed as too harsh

Supreme Court Decision in Ricci

Connecting SC decision with race-norming provision in CRA-91:

If an employer cannot rescore a test based on the candidates' race, ｧ 2000e-2(l),then it follows a fortiori that it may not take the greater step of discarding the test altogether to achieve a more desirable racial distribution of promotion-eligible candidates--absent a strong basis in evidence that the test was deficient and that discarding the results is necessary to avoid violating the disparate-impact provisionDissent: Flaws in the testing used by the City and possible alternative measures

The Court today holds that New Haven has not demonstrated "a strong basis in evidence" ….. In so holding, the Court pretends that "[t]he City rejected the test results solely because the higher scoring candidates were white." That pretension, essential to the Court's disposition, ignores substantial evidence of multiple flaws in the tests New Haven used. The Court similarly fails to acknowledge the better tests used in other cities, which have yielded less racially skewed outcomes

“… the City never asked whether alternative methods might better measure the qualities of a successful fire officer, including leadership skills and command presence. See id., at A522 ("I was under contract and had responsibility only to create the oral interview and the written exam").

Ricci (cont.)

Warning from Scalia “ …the war between disparate impact and equal protection will be waged sooner or later, and it behooves us to begin thinking about how--and on what terms--to make peace between them.

“… this dispute merely postpones the evil day on which the Court will have to confront the question: Whether, or to what extent, are the disparate-impact provisions of Title VII of the Civil Rights Act of 1964 consistent with the Constitution's guarantee of equal protection? The question is not an easy one.

Title VII v. The 14th Amendment?

• Employers should carefully scrutinize exclusionary rules based on potential causes of adverse impact, including:– No beards– Arrest records (e.g., Gregory v. Litton, 1972)– Misdemeanors vs. felonies (e.g., Carter v.

Gallagher, 1971)– Credit information – Wage garnishment

• Employers should ensure that every exclusion in job descriptions, advertisements, and background checks can be defended

Exclusionary Rules

EEOC Guidance for Arrest and Conviction Records (2012)OFCCP Directive Regarding Criminal Record Restrictions

(2013)

Arrest and Conviction Records

Overall Concerns: Whatever statistics you look at, Blacks and Hispanics are:

a) arrested,

b) convicted, and

c) sent to prison at a significantly higher rate than

Whites

SO … use of such data may have a DISPARATE IMPACT on both African Americans and Hispanics (perhaps disparate treatment too; treating minorities more harshly than non-minorities for the same or similar offenses)

Step 1: Did the policy disproportionately screen out applicants based on race, national origin or another protected factor?

Step 2: Is the exclusion job-related and is there a business need related to the job in question? • Unless the above is satisfied, the EEOC suggests not asking about conviction records on application forms.

Arrest and Conviction Recommendations

Consistent with the above, the EEOC stress considering:1) the nature and severity of the offense, 2) the amount of time that has passed since the conviction (or completion of one’s sentence), and3) the nature and type of job sought

EEOC Suit (2013) Against BMW and Dollar General for Discrimination Using Criminal Background Data9 State Attorney Generals Letter Opposing EEOC Guidance on Criminal Background Data

Summary of State Attorney General’s Concerns

•The EEOC’s goal to prevent racial discrimination in this context may lead to the creation of a new protected class (i.e., ex-offenders). Creating protected classes is the role of Congress.  

•The EEOC’s Enforcement Guidance are an unwarranted expansion of Title VII

•The EEOC  is obstructing state and local laws which require criminal background restrictions on certain positions of employment

•Feasibility of performing individualized assessments ($, time) and possibility of increased suits if subjective, individualized assessments are challenged for not being performed

2004

In general, how frequently does your organization, or an agency hired by your organization check any of the following references for its job candidates?Credit Checks

Always: 19%Sometimes: 24%\ 42%Rarely: 18%  Never: 39%

Survey margin of error: +/- 5%Note: n = 296. Excludes respondents who responded “Don’t know.”Source: SHRM Reference and Background Checking Survey (2004)

2010

Does your organization, or an agency hired by your organization, conduct credit background checks for any job candidates by reviewing the candidates’ consumer reports?

Credit Checks

All job candidates: 13%Select job candidates: 47%No: 40%

Survey margin of error: +/- 5%Note: n = 343. Excludes respondents who responded “Not sure.”Source: SHRM Background Checking Survey (2010)

SHRM Credit Background Check Survey Results

On which categories of job candidates does your organization conduct credit background checks?

SHRM Survey on Use of Credit Background Checks

(2010)

In general, when making a hiring decision about a job candidate, which are the most important factors influencing the final decision to hire a particular candidate over another?

SHRM Survey (cont.)

When does your organization, or any agency hired by your organization, initiate credit background checks on job candidates?

SHRM Survey (cont.)

Does your organization allow job candidates, in certain circumstances, the opportunity to explain the results (e.g., high debt, bankruptcy, etc.) of their consumer report that might have an adverse effect on an employment decision?

SHRM Survey (cont.)

SHRM Credit Check Survey Research Summary

• The use of credit background checks in employment decisions has not changed in any discernable way over the past 6 years.

• Most organizations do not conduct credit background checks on all job candidates.

• Organizations conduct credit background checks for those positions where this information is most job-relevant.

• Employers place lower relative importance on credit background checks than other job-related factors in making hiring decisions.

• Employers do not use credit background checks to screen out mass numbers of candidates in the early phases of the application process.

• Credit background check results are seldom used as a definitive hiring criterion.

From: Statement of Michael Aamodt, Ph.D., Principal Consultant, DCI Consulting Group, Inc. EEOC Meeting of October 20, 2010 - Employer Use of Credit History as a Screening Tool

Credit score: A number which provides a “snapshot” over a certain period of time (not shown to employers)Credit report: Generates information about an individual’s debt over a longer time frame than a credit score

Two large studies by the Federal Reserve System in 2003 and Freddie Mac in 2000 concluded that Asians and Whites have higher credit scores than do Hispanics and African Americans

Criterion K N r

Work problems 10 7,464 .149

Discipline 5 5,946 .131

Absenteeism 6 1,678 .211

Performance ratings

3 561 .069

K = number of studies, N = total sample size, r = sample-size weighted uncorrected average correlation

Meta-Analysis

No relationship between credit ratings and performance scores or termination decisions (Bryan & Palmer, 2012) – over 170 employees in a financial organization

A recent study (Bernerth, Taylor, Walker, & Whitman, 2011) found credit scores to be predictive of certain work-related outcomes and Big 5 personality scores. The authors found that credit scores were significant and negatively related to supervisor ratings of:

• Task performance (supervisor ratings) and employee engagement in OCBs

Credit score were also predictive of Big 5 personality scores of • Greater conscientiousness • Low agreeableness

• But, credit scores were NOT found to predict supervisor ratings of: workplace deviance (e.g., theft, aggressiveness)

However, the authors caution the use of credit scores absent data demonstrating their job relatedness for certain jobs and the potential for adverse impact.

Credit Scores

From Bernerth (2012)

Concerns for Adverse Impact of Credit Scores

Language and Communication

• Selection decisions based on foreign accent and fluency in English are legal as long as they are job-related

– Employment decisions may be based on accent if effective oral communication in English is required to perform job duties (e.g., teacher, customer service) and an individual’s foreign accent interferes with ability to communicate orally in English

– An individual’s lack of proficiency in English may interfere with job performance in some situations, but not in others

• The employer should not require a greater degree of fluency than is necessary for the relevant position

Cases Based on Communication• Meja v. New York Sheraton Hotel (1978)

– Dominican national denied promotion from chambermaid to cashier

– Dismissed due to her inability to communicate during her testimony

• Stephen v. P.G.A. Sheraton Resort (1989)– Black Haitian discharged from work as a purchasing

clerk, but offered a transfer to maintenance department

– Termination was ruled legal due to a number of costly purchasing mistakes related to his inability to speak and understand English

Cases Based on Accent

• Berke v. Ohio Department of Public Welfare (1980)– Berke had a master’s degree and above

average use of English language but was denied two promotions due to accent

– Court ruled she had an accent but could be readily understood

• Carino v. University of Oklahoma (1984)– Filipino male deemed competent enough to fill

in as supervisor in a dental lab but not for the permanent position

English-Only Rules

• Garcia v. Gloor (1980)– Required employees to speak English

while working unless serving Spanish-speaking customers

– EEOC agreed with Garcia, that speaking Spanish is a source of ancestral pride

• English-only rules created an atmosphere of inferiority

• Business necessity must be demonstrated • English-only policy may be justified for safety

reasons

– 5th circuit favored Gloor, ruling that speaking English is a mutable (easily altered) characteristic for bilingual employees

English-Only Rules

• Garcia v. Spun Steak (1993)– Two employees were using Spanish language to

insult two fellow employees– 9th circuit overturned EEOC Guidelines and ruled

in favor of employer for insufficient evidence for a prima facie claim

• Agreed with EEOC that English-only policies create adverse impact toward bilingual employees, but favored the defendant based on business necessity

English-Only Rules

• Illinois district court ruled English-Only rules may create a discriminatory work environment based on national origin

• Texas district court found that these rules burdened national origin minorities because they kept members of these groups from speaking in the language in which they are best able to communicate

• Despite mixed reviews in the courts, EEOC has sent a strong signal that English-only rules will be prosecuted unless there are job-related reasons for this policy