January 17, 2008

Many employers use employment tests and selection procedures – including cognitive tests, personality tests, physical ability tests, credit checks and criminal background checks – to screen applicants for employment and employees for promotion. As such testing and selection procedures have become more prevalent, the number of cases challenging various tests and selection procedures as discriminatory also has increased. Given this trend, in December, the Equal Employment Opportunity Commission issued a fact sheet regarding the application of federal anti-discrimination laws to employment testing and selection procedures.

As the fact sheet explains, employers can be held liable for violating the anti-discrimination laws not only if they use employment tests and/or selection procedures to discriminate intentionally, but also if they use seemingly neutral testing and/or selection procedures that disproportionately exclude people in a protected group. To defend a test or other selection procedure that disproportionately excludes members of a protected group, an employer must demonstrate that the test or procedure is job-related and consistent with business necessity. Even if the employer can satisfy this burden, a person can still challenge the test or procedure by arguing that the employer could have used an alternative test or selection procedure that would have been equally effective without having an adverse impact on the protected group.

With these perils in mind, the fact sheet provides useful advice for employers that use or are considering using employment tests and/or selection procedures. Specifically, the fact sheet recommends that:

• Employers administer tests and other selection procedures without regard to an individual’s race, color, national origin, sex, religion, age (40 or older), disability or other protected characteristic.
• Employers ensure that employment tests and other selection procedures are properly validated for the positions and purposes for which they are used. As discussed above, employment tests and selection procedures must be job-related and their results must be appropriate for the employer’s purpose. While a test vendor’s documentation supporting the validity of a test may be helpful, the employer remains ultimately responsible for ensuring that any tests it uses do not violate the anti-discrimination laws.
• 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, the employer should 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 employer, its appropriateness for a specific job, and whether it can be appropriately administered and scored.

In light of the EEOC’s increased focus on employment testing and selection procedures, employers who use or are considering using employment tests and/or selection procedures should take this opportunity to review those tests and/or procedures to ensure that their benefits outweigh any potential legal risks, and that they comply with applicable law.

If you have any questions about the information contained in this Client Alert or any other labor or employment issues, please contact Ana Salper at (212) 351-3710 or [email protected], or Rebecca Brandman at (212) 351-4652 or [email protected], both in the firm’s New York office.