Total Quality Sales Management Topics

EEO and Legal Considerations

The Basics of Legal Employment

Typically, employers are free to establish any criteria for employment practices they choose, as long as they:

• Do not conflict with any negotiated commitment, such as a union or employee contract, and
  
  
• Do not have a discriminatory impact on any protected class without demonstrating a valid reason consistent with business necessity.

In the latter case, if there is a non-discriminatory alternative with an equally valid business justification, then the alternative should be used. This is a critical point since assessment can often be shown to be non-discriminatory but most interviews cannot.

Three Criteria to Establish A Legal Selection Technique

The basis for non-discriminatory hiring rests on three principles. First, the selection process should not have a discriminatory impact, unless, second, there is a valid justification of business necessity. Finally, if there is discriminatory impact, even with a valid business justification, and there is another equally valid alternative selection method that would have no discriminatory impact, then the alternative should be used.

Discriminatory impact, on the surface, is straightforward. Any selection process, including recruiting, background checks, interviewing, or testing, etc., that results in "protected classes" being hired or promoted significantly less often than non-protected classes is discriminatory.

Significant impact, as a rule of thumb, means that the percent of protected classes who are hired, promoted, or "pass" a selection criterion is less than 80% of the pass-rate of non-protected individuals who are hired or promoted.

For example, if, as the result of a screening interview, 50% of all white male applicants pass but only 20% of females or "minorities" pass, then the screening interview can be presumed to have discriminatory impact because the pass-rate of minorities is only 40% of white male candidates. If, however, 50% of white males pass and 44% of minorities pass, then the pass-rate of minorities would be 88% of white males and may be presumed to be non-discriminatory, since the 44% pass-rate for minorities is not less than 80% of the 50% pass-rate for white males.

This "Four-Fifths" rule depends on the sample being of sufficient size to be realistic. If three of four white males are hired and only one out of two females are hired from a total of six candidates, then the numbers are too small to make any valid conclusions.

For small companies that have too few employees in a position to validate, any testing procedure that has no discriminatory impact may still be used. For example, Chally's selection assessment scales are non-discriminatory in and of themselves.

In general, a selection technique must be shown to be a valid predictor of success on the job to demonstrate that it is consistent with business necessity. This, in turn depends on two factors:

When a selection practice has a discriminatory impact but can also be proven to be job relevant, i.e., valid and consistent with business necessity, then a complaintant must demonstrate that a non- discriminatory alternative selection technique is equally valid and consistent with business necessity.

For example, if a background check is job relevant but discriminatory, and a test is available that correlates equally well with success on the job but does not have discriminatory impact, then the non-discriminatory test is the best legal solution to the selection need.