In 2010, the EEOC received a complaint that Crothall Services Group was using criminal background checks and criminal history to make hiring decisions that had a “disparate impact” on African-Americans, Hispanics, and male applicants – that is, even though the criteria was facially non-discriminatory, the criteria disproportionally affected certain protected groups.  Before reaching whether Crothall’s selection criteria had such an impact, though, the EEOC came down on the company for another reason:  the EEOC found that Crothall did not make or keep records regarding the impact its criminal history assessments had on applicants based on race, sex, or ethnic group. The EEOC brought suit against the employer for failure to maintain these records.

“But wait,” you say, “aren’t we prohibited from tracking this type of information.”

No, you’re not prohibited and you may be compelled to keep those records… Indeed, employers who are covered by Title VII (with 15 or more employees) are required to track race, sex, and ethnicity when they are using certain selection procedures to ensure the selection procedure does not have a disparate impact on any protected class.

A “selection procedure” is not limited to pre-employment testing. Rather, the Uniform Guidelines on Employee Selection Procedures (UGESP), developed by the EEOC, states that employers using “tests and other selection procedures which are used as a basis for any employment decision,” including hiring, retention, promotion, transfer, demotion, dismissal or referral, “should maintain and have available for inspection records or other information which will disclose the impact which its tests and other selection procedures have upon employment opportunities of persons by identifiable race, sex, or ethnic group…in order to determine compliance with these guidelines” §2(B); §4(A). The EEOC provides examples of employment tests and other selection procedures, including the following:

• Cognitive tests assessing reasoning, memory, perceptual speed and accuracy, and skills in arithmetic and reading comprehension, as well as knowledge of a particular function or job;
• Physical ability tests measuring the physical ability to perform a particular task or the strength of specific muscle groups, as well as strength and stamina in general;
• Sample job tasks (e.g., performance tests, simulations, work samples, and realistic job previews) assessing performance and aptitude on particular tasks;
• Medical inquiries and physical examinations, including psychological tests, assess physical or mental health;
• Personality tests and integrity tests assessing the degree to which a person has certain traits or dispositions (e.g., dependability, cooperativeness, safety) or attempting to predict the likelihood that a person will engage in certain conduct (e.g., theft, absenteeism);
• Criminal background checks providing information on arrest and conviction history;
• Credit checks providing information on credit and financial history;
• Performance appraisals reflecting a supervisor’s assessment of an individual’s performance; and
• Proficiency tests determining English fluency.

For any tests or selection procedures used to make employment decisions, the employer should track race, sex, and ethnicity data to demonstrate whether the selection procedure is valid and non-discriminatory. Therefore, if a complaint is ever filed with the EEOC and the EEOC requests the information in its investigation, the employer will be prepared to comply. The employer has the burden of demonstrating the validity of a selection procedure.  And while UGESP ostensibly provides guidance to employers on how to validate selection procedures, these materials are actually quite complicated. Employers should consider hiring an expert to assist in measuring the validity of any selection procedures.   Even though they, in and of themselves, don’t carry the force of law (they’re only guidelines…), running afoul of EEOC dictates is surely to cause problems down the road.

In the meantime, and while you’re looking for that expert, the following are practical tips your company should consider when implementing any selection procedure:

• Begin measuring the impact of the test on your applicants based on the race, sex, and ethnicity data you have collected. Make sure your application forms include a statement that your company is an equal opportunity employer and that any information collected is solely to determine suitability for the position, verify identity, and maintain employment statistics of applicants.
• Before using a selection procedure, carefully consider whether it is absolutely necessary to use the test to evaluate candidates for the specific position. If it is not, consider eliminating the test to avoid potential liability. Tests or selection procedures should not be adopted casually.
• When using a selection procedure, consider and evaluate its potential for disparate impact upon a protected class.
• When using a selection procedure, ensure that accurate validity studies are available (where applicable) to support the testing if you are ever questioned by the EEOC. Do not simply rely on statements of validity by the vendor.
• Apply any selection procedure uniformly to all applicants for the relevant position.
• Consider how you will track and maintain the data so as to have it available for inspection by the EEOC or another governmental agency if required.

Spending time now to ensure your company is in compliance can save you a headache down the road if ever one of your employees or an applicant files an EEOC complaint. If you have any questions on how to get started with tracking and maintaining your employment records, please give us a call. We’d like the opportunity to help.