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Personnel Selection

U1: The Legal Context

Schedule:Wednesday, 1/09: LectureMonday, 1/14: LectureWednesday, 1/16: Exam

Monday, 1/21: No classMLK Day

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SO5: Why is selection an uncertain activity?

Selection is based on prediction We know that all of our decisions are not going to be correct We don’t have all of the information we need to make perfect

predictions There are a lot of factors that affect the quality of a selection

process

(First few SOs are straightforward; but I just want to make a few general points about selection before moving to the legal issues; many people don’t understand selection well; main things to keep in mind…)

The primary purpose of selection is toenhance the probability of making correct decisions

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SO5: NFE, Constraints on selection(except SO1 which is for the exam)

Limited information about applicants: Relates back to SO1 The more information you obtain, the costlier it becomes, so

the data you get is severely limited by cost constraints When you have a lot of applicants, the costs of selection

become a particularly important factor for the organization You can’t possibly interview 50 applicants, for example

That means the number of applicants must be reduced considerably at the very beginning of the process

Usually done by using selection instruments that don’t cost much to administer (application form and resume)

The irony is that you can’t get much information from these So….many people are rejected upfront based on very little

information

(obviously increases your errors – uncertain activity and you are going to make mistakes; F2 next slide)

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SO5: NFE, Constraints on selection

Measures of jobs, individuals, and performance criteria Your job analysis is not going to be perfect Your interview/test results are not going to be perfect

Interview - applicant/interviewer is having a bad day Tests - wording of questions may cause problems

Job performance measures used to determine job relatedness of selection instruments are going to be flawed

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SO5: NFE, Constraints on selection

Many other factors affect work performance Motivation Equipment PM programs (task clarification, goal-setting, rewards, etc.) Work systems and processes

(basically, these are the factors analyzed in our performance diagnostics systems – factors from PSY 6520.. As behavior analysts, we tend to focus on these factors rather than selection..)

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SO7: (NFE) Two major objectives of every selection program

1. Maximize the probability of making accurate selection decisions

2. Minimize the probability that the organization will lose EEO and AA challenges by developing procedures that conform to the legal requirements

Note the wording of the second one - you cannot protect the organization from claims of unfair discrimination, but you can develop procedures that decrease the probability that if your procedures are challenged the EEOC and/or the courts will rule against you

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SO7: Professionally vs. legally sound, NFE

If your procedures are professionally sound, they will usually be legally sound and,

If your procedures are legally sound they will usually be professionally sound….

But not always!! Court decisions are based on the past

Uniform Guidelines on Employee Selection Procedures - promulgated in 1978

Previous court decisions The professional field of testing and psychometrics has

continued to advance during that time, so… There are procedures that testing professionals consider

sound, while the courts may not

(I’ll point out the discrepancies as we proceed through the course)

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(NFE) Legal context, intro

Laws and court decisions are very complex Laws and court decisions change over time EEO laws are viewed by many in the I/O field as the

most significant event in the history of the field Personnel selection is the largest area of specialization in

I/O psychology (and has been historically) EEO laws expanded this area of specialization

Era began with passage of Title VII of the Civil Rights Act of 1964 (two CRAs before that, but not much impact due limitations)

Financial impact on organizations can be astounding (consider the examples from last class)

(new laws are passed, most recent American with Disabilities Amendments Act, but before that CRA of 1991; court interpretations change over time depending upon whether the courts are liberal or conservative - Supreme Court is now pretty balanced, slight leaning toward being conservative)

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SO8 Intro: Why do laws appear to disregard interests of business?

Laws place a considerable burden on employers They can be so complex, that you cannot predict

how the courts will rule if a case gets that far, even if you have studied all of the laws and regulations:

“We know what we cannot do based on the court cases, but we do not know what we can do”

Gatewood, Field, & Barrick

(NY State Court system - developing state wide selection tests - one court order mandating that we administer the tests by a designated date;another court injunction barring us from administering those same tests - threw up our hands - brought in Bob Guion as a friend of the court)

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SO8: Why do laws appear to disregard interests of business?

The laws have been passed to address national social and economic problems (which is the job of government)

The constituents of the laws are not businesses, but social and political groups and citizens devoted to solving employment inequities

Thus, at times, the laws really do seem to disregard business interests (and, in fact, do)

(remember, you are taking this class as a potential person who will be doing selection; issue for you –students can’t help siding with applicants….)

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SO9: FETwo important points before the laws

1. None of the laws, EEO or AA, require an organization to hire an unqualified minority (protected class member) EEO requires that the best qualified person is

hired, regardless of whether that person is blue, green or purple

AA does give preferential treatment, but only to qualified applicants

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SO9, cont: Two important points

2. Laws are only applicable if your selection procedures have a disproportionate effect on applicants because of some demographic characteristic (gender, race, ethnic background, religion, weight, age, disability, etc.)You can have the absolutely worst selection methods - that have nothing whatsoever to do with the requirements of the job - but if these procedures have an equal impact on all individuals (majority and minority alike), a lawsuit cannot be filed. There must be some evidence that the selection system has a disproportionate impact on individuals based on some demographic characteristic.

(some states, sexual orientation - MI; CA - cross-dressers, click: for lousy selection system; Dow can continue to use handwriting analysis as long as)

A lousy selection system is NOT illegal if it affects everyone the same!!

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SO10, intro: Three sets of laws

Laws passed by the legislature and administered by the Equal Employment Opportunity Commission (part of the Dept. of Justice)

Laws passed by the executive branch and administered by the Office of Federal Contract Compliance Programs (part of the Dept. of Labor)

Constitutional amendments (5th and 14th) subject to administrative law procedures

Note that all three branches of our government are involved: Legislative, Executive, and Judicial

(text lists laws, but I don’t like the way they are presented and organized, so I present them in a more logical manner in the SOs, but first…3 sets of laws differ in certain ways, which I will explain in a moment - for the moment, I am going to focus on only on the first two sets of laws)

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SO10

10A. State the groups/characteristics covered by each law

10B. Explain the three major differences between the laws administered by the EEOC and the OFCCP

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SO10:EEO laws administered by the EEOC

Covers all private and public employers (including Congress as amended in 1972) with more than 15 individuals, but excludes the military, private clubs, religious organizations, and any businesses on Native American reservations

(Indian reservations are considered sovereign nations - do not cover casinos ( Firekeepers, Soaring Eagle) or any other business on an Indian reservation - have their own laws and government - laws are NOT the same as those of the rest of the state/country - traffic, criminal laws, etc. Soaring Eagle - employer made derogatory remarks about white employees - got into a lot of trouble, but no law protects individuals on reservations)

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10A: State groups/characteristics covered by each law (EEOC)

Title VII of the CRA of 1964

As amended in 1978 also CRA of 1991

Not really a separate act; amends several others

Age Discrimination in Employment Act of 1967

American with Disabilities Act, 1990

ADA Amendments Act, 2008 Genetic Information

Nondiscrimination Act, 2008

Race, color, religion, sex, national origin

pregnancy, childbirth Same as above

Individuals over 40

Physical and mental disabilities

Same as above Everyone, genetic information

including family medical history

(title VII, sex added to prevent passage by congress members who opposed it- old boy network wouldn’t approve it; Age discrimination - protects elderly??)

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10A: Other EEOC laws (but these laws are NFE)

CRA of 1866*

CRA of 1871

only state and fed gov. Immigration Reform and

Control Act of 1986

Race, national origin, and ethnic background

All demographic characteristics

Citizenship, national origin

(Title VII only permitted judges to hear cases - next unit; later this unit, 2 kinds of disproportionate cases - intentional and adverse impact)

*Permitted jury trials and compensation for damages that Title VII did not; thus some cases brought under this act rather than Title VII. However, the CRA of 1991 now permits (a) jury trials and (b) limited damage awards for intentional discrimination cases filed under Title VII.

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SO10: EEO & AA laws administered by the OFCCP

These laws are relevant only to government contractors.

A government contractor is, however, defined broadly, as any organization that enters into a work contract with the federal government or receives federal funds.

WMU, for example, is considered to be a federal contractor because of federal grant dollars, and thus must abide by these laws.

(notice addition of AA in the title - reason will become clear in a moment)

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10A: State groups/characteristics covered by each law (OFCCP)

Executive Order 11246

Rehabilitation Act of 1973

(established many precedents for ADA of 1990)

Vietnam Veterans Act of 1974

Race, color, religion, sex, national origin

(same as Title VII) Physical and mental

disabilities

(same as ADA)

Vietnam era vets, all vets who are at least 30% disabled

(why duplicate laws? These require AA - the EEOC laws do not. The notion here is that the federal government should not require AA - givingPreferential treatment to some citizens; however, the government wanted to promote AA as a social policy; thus, if an organization accepts federal dollars, then they must accept the conditions that go along with that money Compliance is viewed as voluntary in the sense you do not have to accept the fed dollars.)

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10B: Three basic differences - EEOC laws and OFCCP laws

1. Types of organizations covered EEOC laws cover all private and public

employers with more than 15 employees (with some exceptions)

OFCCP laws cover only federal contractors

2. Affirmative Action EEOC laws do not require AA programs OFCCP laws do require AA programs

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10B: Three basic differences - EEOC laws and OFCCP laws

3. Penalties for noncompliance EEOC laws: Individuals can file a law suit for

unfair discrimination and seek redress OFCCP laws: Withdrawal/withholding of federal

dollars - individuals cannot file a law suit under these laws (however, there is one exception: oddly, courts did permit disabled individuals to bring law suits under the Rehabilitation Act of 1973 until ADA was passed in 1990 - go figure. This material in parentheses is NFE.)

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SO11: This slide NFEProtected classes under Title VII

In the laws, the protected groups are broadly defined (race, color, sex, religion, and national origin)

The specific protected classes are not indicated so the laws are flexible and can be applied to individual cases

The general protected classes were designated in the Uniform Guidelines on Employee Selection Procedures in 1978, and courts have relied on these (although they have also made exceptions for individual cases)

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SO11: Protected classes under Title VII

Protected classes African American Native Americans (including Alaskan natives) Hispanics (Mexican, Puerto Rican, Cuban, Central or South

American, or other Spanish origin regardless of race) Asians (including Pacific Islanders, but excluding Indians who

are racially Caucasian) Females

Note that classifications are not mutually exclusive Pacific Islander who is Hispanic (Phillipino) African American who is also Hispanic Individuals self-identify

(for exam, only know the five protected classes; multiculturalism is not built into the laws - no such designation))

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SO11: Protected classes under Title VII, interesting facts, but NFE

Laws only cover US citizens and those with legal authorization to work in the US International students who are not citizens and do not have legal

authorization to work in this country (are on student visas) are not covered by these laws

Individuals in other minority groups can file a lawsuit, but the courts will then decide first whether or not they are actually entitled to coverage under Title VII Courts have recently spent a lot of time trying to determine what

constitutes a “religion” (religion vs. spirituality) Scientology? Satanism, Wicca, and Paganism? Unitarian? Vodoo? Over half of the 2,000 plus primary religious groups operating in the US

were formed after 1960

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SO11: Protected classes under Title VII, interesting facts (NFE)

Courts have adopted a very broad definition of religion“include moral or ethical beliefs as to what is right and wrong and which are sincerely held with the strength of traditional religious views…”

Asians and the term “underrepresented” Asians are included as a protected class They are often not, however, underrepresented because they

typically perform very well on cognitive ability tests (ACTs, SATs, GREs, etc.)

Thus, they are often excluded from some scholarship programs and AA programs

When you see the term “underrepresented” minorities, it typically translates into “Asians excluded”

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SO12: Why laws and court rulings shift over time: CRA of 1991, as an example

Why do we have so many CRAs? Why a CRA of 1991? Demonstrates our government at work and the checks

and balances with the three branches of our government Congress makes the laws The judicial branch (Supreme Court) interprets them If Congress doesn’t like how the Supreme Court interprets

laws, they pass new laws The above is exactly what happened with respect to Title

VII and the CRA of 1991 (and ADA and ADAAA)

(In personnel selection, what you learn about the laws and court rulings today may or may not be the case tomorrow; things were pretty wild, after ADA was passed and before ADAAA 2008 – both the CRA of 1991 and ADAAA provide a nice examples of that process) )

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(NFE) CRA of 1991, a little history

Start with Title VII of the Civil Rights Act of 1964 In 1989, the Supreme Court handed down decisions

about three selection cases (the most famous being Wards Cove)

The Court was a conservative court, Congress was a liberal Congress and Congress did not like the decisions Democrats typically support EEO and AA due to social

liberalism Republicans typically do not due to constraints/impositions

on business

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(NFE) CRA of 1991, a little history

Hence, because Congress was liberal, they passed CRA of 1991 that, with a few exceptions, negated the decisions of the Supreme Court in the 1989 cases Main framer was Edward Kennedy (arch liberal Democrat) Worked with Robert Dole (conservative Republican) to draft

the CRA Compromises made

Same process that affected the Shifting Burden of Proof model for adverse impact cases – established by one of the first court cases, Griggs v. Duke Power, 1971

Same process that resulted in ADAAA of 2008

CRA, Edward Kennedy - many, many revisions and compromises before passage; Bush vetoed the first version. Power of the Supreme Court -Justices appointed for life and most sought after appt a President makes. Incredible influence on the laws of our country. Pack the court, lib or con. completely change the “law of the land” for decades.)

NFE: Supreme Court Composition

Four conservative Two appointed by Bush, two by Reagan

Samuel Alito, Anthony Kennedy, Antonin Scalia, Clarence Thomas,

Four liberal Two appointed by Obama, two by Clinton

Ruth Bader Ginsberg, Stephen Gerald Breyer, Elena Kagan, Sonia Sotomayor,

One “swing vote” who leans conservative Appointed by Bush

John Roberts, Chief Justice

29(Right now, pretty balanced court politically)

NFE: Supreme Court Composition

Other interesting facts re the Supreme Court Six men, three women (all women are liberal) Six Catholic, three Jewish (all Jews are liberal)

USA Today has great interactive graphics re the Supreme Court justices www.usatoday.com/news/washington/judicial/2010-03-13-

supreme-court-justice-bios_N.htm

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SO13: CRA 1991, one significant change

Before CRA 1991 Plaintiffs only had to show that the overall selection

process resulted in adverse impact

After CRA 1991 Plaintiffs have to tie adverse impact to a particular

selection instrument/practice unless the selection decision is based on scores from all selection instruments One of the reasons the Supreme Court ruled that a

class action suit was inappropriate in the Walmart case

31(although the CRA91 negated most of the SC’s 1989 decisions, there were a few exceptions – next two Sosrelate to two of them; define adverse impact)

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SO15: CRA of 1991 and race norming

The CRA of 1991 bans any type of race norming for selection purposes This provision is again in concert with the Supreme Court

decisions made in 1989 What is race norming?

You group individuals according to their race and then rank them with respect to this comparison group.Whites are grouped with whites. Blacks are grouped with blacks. Hispanics are grouped with Hispanics. Etc.Choose/select high scorers from each group, regardless of how well the blacks compare to whites and Hispanics, how the Hispanics compare to whites and blacks, etc.

(SO14, NFE)

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SO15: CRA of 1991 and race norming

Most common race norming method Create separate ranked selection lists. Then select the top white

first, then the top black, then the top Hispanic, then the top Native American, then the top Asian, then go back to the white list with the second ranked applicants.

More sophisticated approach using percentiles Determine percentile rankings for applicants within racial group

and then create one list of percentile rankings A white, within the white group, scored in the 96th percentile. That

means the candidate scored better than 96% of the white applicants A black, within the black group, scored in the 98th percentile of the

black applicants. That means the candidate scored better than 98% of the black applicants

Create one list, with the black candidate above the white candidate, regardless of whether the black candidate’s raw score was actually better than the white candidate’s raw score

(used extensively when quotas were acceptable. First major selection case, Griggs v. Duke Power, court imposed a 50% hiring quota for blacks due toTests that were not job related and had an adverse impact on blacks)

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SO15: CRA of 1991 and race norming

Race norming was very common before CRA of 1991 Why?

Achieved a diverse work force Selection procedures cannot be challenged in court if

there is no adverse impact on minorities, and this procedure prevented adverse impact

Quotas were once legal; easiest and fairest way to deal with a court-ordered AA program with, let’s say, 50% hiring quota (i.e., Griggs v. Duke Power)

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SO16: Arguments for and against race norming

For:Helps employers hire a qualified diverse work force combined with the fact that selection tests often account for no more than 25% of how well individuals perform on the job. In other words, there is a lot of error in predictions made by selection tests (at least 75% of how well individuals perform on the job is often determined by other factors), thus we may not be sacrificing that much in productivity using these methods.

(selection specialists are split on this issue)

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SO16: Arguments for and against race norming

Against:

Minorities usually do score lower on many job-related, valid selection tests, thus any adjustments in the rankings of applicants can be expected to decrease productivity.

(one fact of selection, whether we like it or not, is that on cognitive ability tests, blacks tend to score 1 SD below whites, hispanics tend to score2 SDs below whites and asians typically score better than whitesl. Given that the tests are job related..)

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SO18: Constitutional Amendments: How do they differ from other laws

5th and 14th Amendments to the Constitution1. Only relevant to federal, state, and local governments2. They cover ALL citizens and are not restricted to

demographic groups or characteristics Sexual orientation Even eye or hair color

3. Individuals must prove the intent to discriminate, not simply that the selection procedure had disparate impact Two types of unfair discrimination: intentional and disparate

impact, I’ll get to the difference in the moment, but It is much more difficult to prove intent to discriminate than it

is to prove disparate impact

(Moving onto SO18, 17, NFE; Individuals may also bring unfair discrimination law suits under the 5th and 14th amendments to the constitution; due process clause in the constitution)

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SO20: Adverse impact vs. discrimination, intro

Fair discrimination is when individuals who have lower probabilities of being selected would, in fact, perform lower on the job, if hired

Unfair discrimination is when individuals who have lower probabilities of being selected would perform as well, if hired, as others who had higher probabilities of being selected

(set the stage for this distinction; the purpose of all selection instruments is to discriminate between individuals - otherwise the selection procedure would beuseless. Laws designed to prevent unfair discrimination, not just “discrimination” but we often drop the “unfair” due to context - but it is important; click!!!)

Fair discrimination is NOT illegal even if it has adverse impact on protected class members!!

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SO20: Adverse impact vs. discrimination,

Adverse impact:The selection procedure has a disproportionate effect on demographically different individuals or groups

Unfair discrimination:There is not a valid, job-related explanation for the disproportionate effect (adverse impact)

(text, that is, individuals who belong to a certain demographic group perform more poorly on a selectionprocedure than individuals in a different demographic group; next slide continues this.)

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SO20: Adverse impact does not equal unfair discrimination

Adverse impact suggests that unfair discrimination may have occurred, but it does not, by itself, prove that unfair discrimination has actually occurred

If the organization can prove that its selection procedures are job related (valid), and that individuals who score better on the selection procedure do or would perform better on the job, then adverse impact is OK.

That’s fair discrimination.

(repeat this; in this case, adverse impact would simply be the result of fair discrimination)

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SO20: Example of the difference

A police force requires a physical ability test. The test has adverse impact on females.

Fair discrimination:

Females who perform more poorly on the test also would perform more poorly on the job, if hired

Unfair discrimination:

Females who perform more poorly on the test would perform as well on the job as males, if hired

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SO20: Two other defenses for adverse impact

There are two other legal defenses that organizations can use to defend adverse impact If the selection procedure has “business

necessity” If the selection procedure is a “bona fide

occupational qualification” If you are really cool, a “BFOQ”

(I’ll explain what these things mean in a moment; shifting burden of proof model for disparate impact cases)

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SO21: Two types of unfair discrimination

1. Disparate treatment (= intentional discrimination)

Different standards are applied to different groups of individuals even if there is no explicit statement to discriminate or “intent” Females are asked if they have children but males

are not Blacks are asked if they have an arrest record but

whites are not

(text is a little unclear about disparate treatment; disparate treatment = intentional discrimination even if there was no “conscious intent” or theOrganization did not “mean” to unfairly discriminate; the last phrase “even if” is very important – include it)

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SO21: Two types of unfair discrimination

2. Disparate impact

The same procedure is applied uniformly, but it screens out a disproportionate number of minorities

Height and weight requirements by police and fire departments have adverse impact on females, Hispanics, and Asians and are not job related

BA degree requirement for mfg. supervisors have adverse impact on Blacks, Hispanics and Native Americans and are not job related

(Disparate treatment was not considered to be an adequate definition of unfair discrimination, however, because some selection procedures were applied equally to all applicants, but screened out a disproportionate number of members of protected classes. Definition established by first major selection court case, Griggs v. Duke Power in 1971.)

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NFE: Interesting disparate impact case

The EEOC filed a nationwide hiring discrimination lawsuit against Kaplan Higher Ed.

The issue: use of applicants’ credit history discriminates because of race

Since 2008, Kaplan has rejected applicants based on their credit history

While applied to every applicant, this practice had adverse impact on blacks and, according to EEOC, is not job-related and cannot be justified on business necessity

The EEOC attempted to reach a voluntary settlement before filing the law suit (in U2, I discuss the settlement process)

The EEOC is seeking injunctive relief, lost wages and benefits, and employment of people who were not hired because of use of the credit history

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SO22: Shifting burden of proof model, intro

Shifting burden of proof model is used in all Title VII disparate impact cases

The burden of proof is a very important legal concept, and while it may seem like a subtle issue, it is not

22B. This model differs considerably from criminal cases and what you have seen on TV In criminal cases, a defendant (in this case the company)

is considered innocent until proven guilty The burden of proof always rests with the prosecution,

beyond a “reasonable doubt” Not so in EEOC Title VII disparate impact cases

As the name of the model suggests, the burden of proof shifts

(by far the most common cases, since it is very difficult to prove intentional discrimination - unless, black jelly beans, “Any man…” Spend quite a bitOf time on this - very important)

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SO22A: Shifting Burden of Proof Model, diagram and explain

Plaintiff:Adverse impactPrima facie case

Defendant:Three defenses1. Validity2. Business Necessity3. BFOQ

Plaintiff:*Alternative procedure,less adverse impact

1. Company “innocent”: Plaintiff has the burden of proof to demonstrate adverse impact has occurred (prima facie case if proven)

2. Company “guilty”: Defendant must prove its innocence by demonstrating selection procedure is valid, has business necessity, or is a BFOQ

3. Company “innocent”: But, if plaintiff can demonstrate that an alternative selection procedure exists that historically results in less adverse impact, plaintiff “wins”

*Very few plaintiffs have ever won a case at this step; so while legally possible, yet to be shown to be practical – can’t say much about it .

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NFE: History of Shifting Burden of Proof Model

Established by the Supreme Court in the first landmark selection case, Griggs v. Duke Power, 1971

Reversed by the Supreme Court in Wards Cove Packing Co. v. Antonio, 1989 Burden of proof rested squarely and almost solely

on the plaintiff, making it very difficult for anyone to prove disparate impact

Restored by the CRA of 1991

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SO23: The three defenses

1. Validity (by far the easiest defense to win)Organization establishes that the tests are job-related

2. Business necessity (next easiest to win)If the selection procedure was not used, the safety of workers or customers would be put at great risk. Effects on economics costs and profits/loss of business is not acceptable under business necessity. Commercial airlines requiring pilots have a specified number of flight

hours - not subject to the same proof that those hours are job-related MMPI for police officers - you don’t want to put guns in the hands of

emotionally unstable individuals NY Court System - court officers

(to prove, would have to hire pilots with less flight hours and show they didn’t perform as well)

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SO23: The three defenses, cont.

3. Bona fide occupational qualification: BFOQ (almost impossible to win this defense, very limited application)A person must be of a particular sex, race, color, religion, or national origin in order to perform the job adequately Restricted to sex and religion for jobs like rest room attendants and church

administrators Recently expanded to nursing homes, medical facilities, and human service

organizations – customer privacy, not customer preference; personal needs, bathing, taking a client to the bathroom

Legally it is impossible to frame a BFOQ defense for race, color, or national origin

An Italian restaurant cannot hire only Italian servers or chefs, a Chinese restaurant cannot hire only Chinese servers or chefs, etc.

(courts have interpreted BFOQ very, very narrowly)

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NFE: Hooters and BFOQ?

Hooters hires only females as servers, but does hire males as cooks and dishwashers

Female servers are required to sign and affirm the following (from Wikipedia): My job duties require I wear the designated

Hooters Girl uniform

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NFE: Hooters and EEO, cont.

My job duties require that I interact with and entertain the customers

The Hooters concept is based on female sex appeal and the work environment is one in which joking and sexual innuendo based on female sex appeal is commonplace

I do not find my job duties, uniform requirements, or work environment to be offensive, intimidating, hostile, or unwelcome

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NFE: Hooters and EEO, cont.

Several discrimination lawsuits have been brought against the chain

The lawsuits have been settled out of court or dropped by the EEOC (1995 was the big test)

Some after an advertising campaign featuring a St. Petersburg, FL, Hooters kitchen manager (Vince Gigliotti) dressed in a Hooters Girl serving uniform

SO24: Rank order of defenses

Validity: job related Business necessity BFOQ

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SO25: Adverse impact statistics, intro

Several different types of statistics can be used to determine whether adverse impact exists

There are two broad categories Stock Flow

However, companies only have to report statistics for a demographic group if that demographic group constitutes at least 2% of the labor market for the job; that is, adverse impact is only relevant if the demographic group makes up at least 2% of the labor market

(define each on next slide)

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SO25: Adverse impact statistics, intro

Stock statisticsStock statistics consider the proportion of qualified minorities in the geographical region in comparison to the proportion of minorities in the relevant position

Flow statistics (“flow” of applicants through the selection process)Compares the proportion of minorities who applied and were selected to the proportion of non-minorities who applied and were selected

(define both, them come back to each)

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SO25A: Two components of the “relevant” labor market

Stock statistics and “relevant labor market”Stock statistics compare the proportion of minorities in the relevant labor market in comparison to the proportion of minorities in the position

Relevant labor market – two important components Geographical region/location, depends upon

Scope of employer’s recruiting efforts Availability of public transportation Interest among prospective employees in working for the employer in question

(how far are individuals willing to commute) Skill level of the individuals, special qualifications individuals need for

the job Number of electrical engineers in an area is quite different than simply the

number of individuals who live in the geographical region

(These are very difficult to determine – often before a case gets to court – spend considerable time determining RLM)

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SO25A: Two components of the “relevant labor market”

Determination of RLM is Important (greatly influences whether or not adverse impact exists) Difficult to determine

Relevant geographical region depends on the type of job RLM for a professor is the country RLM for a secretary is the local region What’s the RLM for an engineer?

What constitutes the “local region?” In Kalamazoo? Kalamazoo, Portage, Marshall?? In NYC? The local region would be much larger, 1.5 or 2 hour commutes

Often considerable time is spent in a court case determining what the RLM actually is

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SO25A: Two components of the “relevant labor market,” intro

Skill level is also critical Example

An engineering firm has 225 engineers. Of those, 10 are female. Thus, 4.4% of the engineers are female. The percentage of female engineers in the relevant labor market is 3%.Thus, no adverse impact exists.However, now assume that the percentage of female engineers in the relevant labor market is 10%.

Now adverse impact exists.

(This example illustrates the importance of the skill level; in both cases, the % of female engineers is the same; but in the second, there is a greaterPercentage of female engineers in the RLM, and thus adverse impact exists)

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SO25A: Two components of the “relevant labor market, NFE”

RLM is determined from reports such as: US census Chamber of commerce Industry reports

Geographical units are usually reported in three forms Country State Standard Metropolitan Statistical Area

Region surrounding a city or town

25B: Legal Stock Statistic

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Number of femaleengineers in the organization

Total number ofengineers in the organization

Number of femaleengineers in the labor force

Total number ofengineers in the labor force

VS.------------------------------- -------------------------------

(labor force = relevant geographical region)

Percentage of female engineers in the organization vs. percentage of female engineers in the labor force

25B: NFE, Before and after Wards Cove and Civil Rights Act of 1991

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Number of femaleengineers in the organization

Total number ofengineers in the organization

Number of skilled femaleengineers in the labor force

Total number of skilledengineers in the labor force

VS.------------------------------- -------------------------------

VS.

Total number of people in the labor force

-------------------------------

Number of femalesin the labor force

Griggs v Duke Power, 1971; % of female engineers in company vs. just the percentage of females in the labor force; more conservative, favors the organization, makes sense)

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25B: How did the comparison change, NFE

Difference is very important The % of females in the relevant geographical region may be

46%; however, The % of females who are engineers in that same

geographical region may be only 4 % The change makes it more difficult to establish adverse

impact, but is a much more reasonable standard

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SO26: Four-fifths (80%) rule

The most common flow statistics used to determine adverse impact: Four-fifths (80%) rule Standard deviation rule

I’m focusing on the 4/5ths or 80% rule This is the most common statistic used Recommended in the Uniform Guidelines on

Employee Selection Procedures Which is probably why it is the most commonly

used statistic

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SO26: Four-fifths (80%) rule

Four-fifths or 80% rule (for exam)For any selection instrument or procedure, adverse impact is shown if the passing rate of the protected class is less than 80% of the highest passing rate of any other demographic group*

*Note very, very carefully that the comparison is not made to the non-minority demographic group (whites or males), but to the demographic group that has the highest passing rate, whether or not that is the non-minority demographic group (whites or males) or another protected class.

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SO26: How to calculate adverse impact using the 4/5ths rule

1. Determine passing rates for each relevant demographic group Whites, Blacks, Hispanics, Asians, Native Americans Males, Females NOT white females, white males, black females,

black males, hispanic females, hispanic males, etc.

2. .80 X passing rate of group with the highest rate3. If the passing rate of the demographic group falls

below the number in the second step, adverse impact has occurred.

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SO26: Example and calculations

Group Applicants Selected

Whites 165 85

Asians 80 34

Hispanics 27 8

Passing Rate

85/165 = 52%

34/80 = 43%

8/27 = 30%

Step 1: Determine passing rates for each group

Step 2: .80 X highest passing rate.80 X 52% = 42%

Step 3: Compare passing rates to highest rate

Asians, 43% is greater than 42%: No adverse impactHispanics, 30% is less than 42%: Adverse impact

(ask if anyone has done them; also, notice, in this example the whites have the highest passing rate; but…)

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End of Unit 1

Questions? Comments?