Patrick Nooren, Ph.D. Criselda Cooper

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1 One Step Forward, Two Steps Back How Only Increasing Your Organization s Diversity Outreach/ Recruitment Efforts (In the Absence of Anything Else) Can Do More Harm Than Good Patrick Nooren, Ph.D. Criselda Cooper

2 Biddle Consulting Group, Inc. 193 Blue Ravine, Suite 270 Folsom, CA Patrick Nooren Criselda Cooper

3 Overview of Biddle Consulting Group, Inc. Affirmative Action Plan (AAP) Consulting and Fulfillment HR Assessments Custom Test Development & Validation EEO Litigation Consulting /Expert Witness Services Compensation Analysis Publications/Books BCG Institute for Workforce Development Speaking and Training Thousands of AAPs developed each year Audit and compliance assistance myaap Enterprise software AutoGOJA online job analysis system TVAP test validation & analysis program CritiCall pre-employment testing for 911 operators OPAC pre-employment testing for admin professionals Video Situational Assessments (General and Nursing) High stakes test development Validation studies in response/prevention to litigation Over 200+ cases in EEO/AA (both plaintiff and defense) Focus on disparate impact/validation cases Proactive and litigation/enforcement pay equity studies COMPare compensation analysis software EEO Insight : Leading EEO Compliance Journal Adverse Impact (3 rd ed.) / Compensation (1 st ed.) 7,500+ members Free webinars, EEO resources/tools Regular speakers on the national speaking circuit

4 Biddle Consulting Group Institute for Workforce Development (BCGi) BCGi Memberships (free): ~7,500+ members / 18,000+ HRCI credits to-date Online community Monthly webinars on EEO compliance topics EEO Insight Journal (e-copy) BCGi Platinum Membership ($299/yr) Includes validation/compensation analysis books EEO Tools including those needed to conduct AI analyses EEO Insight Journal (e-copy and hardcopy) Access to the BCGi library of webinars, training materials, and much more 4

5 Disclaimer This presentation is not to be interpreted as legal advice. This document provides information of a general nature. None of the information contained herein is intended as legal advice or opinion relative to specific matters, facts, situations, or issues. Additional facts or information or future developments may affect the subjects addressed in this document. You should consult a lawyer about your particular circumstances regarding any of this information because it may not be applicable to your particular situation Biddle Consulting Group Inc. Contact Biddle for reproduction rights. 5

6 Agenda No Good Deed Goes Unpunished: How Increasing Your Organization s Diversity Outreach/Recruitment Efforts (In the Absence of Anything Else) Can Do More Harm Than Good What does OFCCP focus on? What do contractors typically focus on? What do you miss when you only focus on outreach? Recommendations/Summary 6

7 Which analyses have historically been the OFCCP s bread-and-butter? Comparison of Incumbency to Availability (women/minorities/ individuals with a disability) Disparity Analyses (all gender/race) Hires Promotions Terminations Compensation Analyses OFCCP Focus 7

8 OFCCP Focus Which analyses have historically been the OFCCP s bread-andbutter? Disparity Analyses (all gender/race ) Hires WHY? ANSWER: BIG Data! OFCCP likes to focus on entry-level, blue collar jobs Those positions tend to result in high numbers of applicants/ hires Analyzing high volumes of data increases the likelihood of statistically significant results 8

9 OFCCP Focus Which analyses have currently been the OFCCP s bread-and-butter? Comparison of Incumbency to Availability (women/minorities/ individuals with a disability) Disparity Analyses (all gender/race) Hires Promotions Terminations Compensation Analyses 9

10 OFCCP Focus Which analyses are the fastest growing area of OFCCP enforcement? Comparison of Incumbency to Availability (women/minorities/ individuals with a disability) Disparity Analyses (all gender/race) Hires Promotions Terminations Compensation Analyses 10

11 OFCCP Focus Which analyses are the fastest growing area of OFCCP enforcement? Compensation Analyses WHY? OFCCP has not had much success over the years finding a methodology that works consistently (remember Dubray Analysis, EO Survey, Item 11 and various trigger tests?) Gender Pay Gap has been a focus of this Administration Recent, New and Coming Soon: Lily Ledbetter Fair Pay Act, Employee-Level compensation, proposed EEO-1 reporting with pay data 11

12 OFCCP Focus Which analyses are often used as the foundation to a claim of discrimination? Comparison of Incumbency to Availability (women/minorities/ individuals with a disability) Disparity Analyses (all gender/race) Hires Promotions Terminations Compensation Analyses 12

13 OFCCP Focus Which analyses lead to the greatest legal exposure? Comparison of Incumbency to Availability (women/ minorities/individuals with a disability) Disparity Analyses (all gender/race) Hires Promotions Terminations Compensation Analyses 13

14 Recent Conciliation Agreements with Monetary Settlements OFCCP Class Member Locator website As of May 2016, list of 7 organizations covering 15 establishments currently being remediated Female Applicants (Order Selectors): $85,000 for allegations of hiring discrimination Female Employees & Male Applicants (Laborers): $1.8+ million for allegations of pay and hiring discrimination Female Applicants (Laborers): $725,000 for allegations of hiring discrimination Female Applicants (Laborers): $446, for allegations of hiring discrimination Female Applicants (Laborers): $466, for allegations of hiring discrimination Black Applicants (Production Workers): $86,000 (including back pay and interest) for allegations of hiring discrimination Male, Black, & White Applicants (Production Positions): $310,000 for allegations of hiring discrimination 14

15 Recent Major Settlements Involving Hiring OFCCP Settlements: G&K Services Co. (November 2015): Paid $1.8 million; involved steering of females into lower-paying jobs with nine of their facilities between 2011 and 2015 compliance reviews Fastenal Company (October 2015); Paid $1.25 million; involved hiring of African Americans and females Hospira Inc. (October 2015); Paid $400,000; involving hiring of females La Pac Manufacturing (July 2015): Paid $235,000; involved hiring of African Americans and Whites Lincoln Electric (June 2014): Paid $1 million; involved hiring of African Americans Cargill Meat Solutions (January 2014): Paid $2.2 million; involved hiring of females, whites, Hispanics, and African Americans at various facilities Cream-O-Land Dairy Inc. (December 2013): Paid $325,000; involved hiring of females, African Americans, and Asians M.C. Dean (October 2013): Paid $875,000; involved hiring of African American, Hispanic and Asian 15

16 OFCCP Focus Which analyses have led to zero (0) conciliation agreements with substantive violations (i.e., make-whole relief, forced hiring decisions, back-pay)? Comparison of Incumbency to Availability (women/ minorities/individuals with a disability) Disparity Analyses (all gender/race) Hires Promotions Terminations Compensation Analyses 16

17 OFCCP Focus Which analyses get the most contractor attention, action-oriented programs, and good-faith efforts? Comparison of Incumbency to Availability (women/ minorities/individuals with a disability) Disparity Analyses (all gender/race) Hires Promotions Terminations Compensation Analyses 17

18 OFCCP Focus Which analyses get the most contractor attention, action-oriented programs, and good-faith efforts? Comparison of Incumbency to Availability (women/ minorities/individuals with a disability) WHY? Goals appear to be the easiest to fix "We are underrepresented in X, so all we need to do is Did anyone think about improving applicant tracking, reviewing selection procedures, updating basic qualifications, etc.??? 18

19 Comparison of Incumbency to Availability Snapshot Date: 12/31/2015 Comparison of Incumbency to Availability Job Group: 7-03: Skilled Machine Operator Test: Whole Person Total Employees (#): 53 Female Total Minority Employee (#) 9 48 Employee (%) Availability (%) Goal Test: Whole Person Yes No Additional Needed to Eliminate Problem Area (#)

20 Comparison of Incumbency to Availability Can having goals be considered discrimination? Only in very rare occasions (for example): 1. Failure to keep applicant records (sometimes referred to as an adverse inference see 4D of the Guidelines) 2. Failure to collect/keep data on selection or promotional processes (also an adverse inference see 4D of the Guidelines) 3. Discriminatory recruiting practice (e.g., Hazelwood School District v. United States) 4. Discriminatory reputation chilled or discouraged certain group members from applying 5. Promoting employees through appointment only process (rather than conducting promotional processes) 6. Invalid Basic Qualifications 7. IMPORTANT: these all touch on elements of PROCESS 20

21 Comparison of Incumbency to Availability So why do most organizations focus so much time/effort on goals and why do most think the best (or only) way to address goals is to make it a recruitment issue? REASON: most obvious "solution" is to add to headcount 21

22 Addressing Goals Solely Through Outreach/Recruitment Skips the entire question, Why are we underutilized? Goes straight to a solution that might be unrelated to the problem and might be potentially harmful! It s like taking an x-ray, disregarding the results, and undergoing a treatment that may be unrelated to the injury/illness! 22

23 How did you get here, anyway? Current Employee Representation is the Result of: Beginning of Year Employee Representation Incoming Hires Promotions Into Transfers Into Involuntary Terminations Voluntary Terminations Transfers From Promotions From Current Current Employee Representation Previous Outgoing 23

24 Addressing Goals Solely Through Outreach/Recruitment Normal Circumstances (an example) Interview Hires 30 White 20 Min. Applicant Pool 50 White (50%) 50 Min. (50%) Passing Rate: White (60%) Minority (40%) STD = 1.80 The difference in hiring rates is close to, but not, statistically significant. 24

25 Addressing Goals Solely Through Outreach/Recruitment Expanded Outreach/Recruitment (an example) Interview Hires 30 White 20 Min. Applicant Pool 50 White (33.3%) 100 Min. (66.7%) Passing Rate: White (60%) Minority (20%) STD = 4.72 The disparity got worse and we made ourselves a bigger target. 25

26 Addressing Goals Solely Through Outreach/Recruitment Expanded Outreach/Recruitment (an example) Interview Hires 25 White 25 Min. Applicant Pool 50 White (33.3%) 100 Min. (66.7%) Passing Rate: White (50%) Minority (25%) STD = 2.95 We helped to address the goal, but the disparity got worse and we made ourselves a bigger target 26

27 Addressing Goals Solely Through Outreach/Recruitment Sample Executive Summary of Results Executive Summary Disparity Analyses Job Group Goal(s) Hires Promotions Term. (All) Fem Min. Fem. Min. Fem. Min. Fem. Min. Plan Exec/Sr. Off. and Mgrs N 6 N 2.43 N N N N 1.2 Entry Off. and Mgrs N 1 N 1.68 N N N N Other Professionals 1 N N N N N N N 5 - Admin Support Workers N 7 N N N 3.23 N 2.98 To address the minority goals in job groups 1.1, 1.2 and 5, what would happen if we only expanded minority outreach/recruitment? 27

28 Addressing Goals Solely Through Outreach/Recruitment Sample Executive Summary of Results Executive Summary Disparity Analyses Job Group Goal(s) Hires Promotions Term. (All) Fem Min. Fem. Min. Fem. Min. Fem. Min. Plan Exec/Sr. Off. and Mgrs N 6 N N N N N 1.2 Entry Off. and Mgrs N 1 N 1.68 N N N N Other Professionals 1 N N N N N N N 5 - Admin Support Workers N 7 N N N 3.23 N 2.98 What happens in JG 1.1 when you expand minority outreach/recruitment? Likely move toward goal, but all else remaining the same, this gets worse! What you should do: look at the selection process! Are there barriers in hiring? 28

29 Addressing Goals Solely Through Outreach/Recruitment Sample Executive Summary of Results Executive Summary Disparity Analyses Job Group Goal(s) Hires Promotions Term. (All) Fem Min. Fem. Min. Fem. Min. Fem. Min. Plan Exec/Sr. Off. and Mgrs N 6 N 2.43 N N N N 1.2 Entry Off. and Mgrs N 1 N N N N N Other Professionals 1 N N N N N N N 5 - Admin Support Workers N 7 N N N 3.23 N 2.98 What happens in JG 1.2 when you expand minority outreach/recruitment? All else remaining the same, this (likely) becomes significant! What you should do: look at the selection process! Are there barriers in hiring? 29

30 Addressing Goals Solely Through Outreach/Recruitment Sample Executive Summary of Results Executive Summary Disparity Analyses Job Group Goal(s) Hires Promotions Term. (All) Fem Min. Fem. Min. Fem. Min. Fem. Min. Plan Exec/Sr. Off. and Mgrs N 6 N 2.43 N N N N 1.2 Entry Off. and Mgrs N 1 N 1.68 N N N N Other Professionals 1 N N N N N N N 5 - Admin Support Workers N 7 N N N 3.23 N 2.98 What happens in JG 5 when you expand minority outreach/recruitment? (Likely) make progress toward goal, but not addressing the real issue(s)! What you should do: look at the promotion/termination process (and the work environment)! 30

31 Addressing Goals Solely Through Outreach/Recruitment Expanded Outreach/Recruitment (in the absence of addressing the real issues) Did you improve outreach? Yes Did you make progress toward goal? Yes (maybe) Did you increase your legal exposure? Yes (!!) 31

32 Should We Ignore Placement Goals? No, but address goals and other problem areas in your Action- Oriented Programs Ensure that your to-do s listed in the Action Programs have actually been performed or are in process (e.g., outreach, review BQ s, identify and eliminate barriers, etc.) Compliance Officers will often ask you to verify that you have been working towards your Action Programs So did you actually do what you said you would? 32

33 Recommendations on Placement Goals Understand that: Goals are not solely addressed via recruitment/hiring Action-oriented programs are about more than just addressing numerical goals - don t forget things like: updating job analyses, creating defensible BQs, amassing validity documentation for all steps in the process, cleaning ATS data/processes, etc., etc., etc., etc. Every problem is not a nail and every solution is not a hammer Be the investigator, ask the questions, find the real issue and then craft a solution that makes sense! Failure to understand the above points will likely lead to wasted time and solutions that only serve to make the problems worse! 33

34 Recommendations on Placement Goals Document and evaluate your outreach and recruitment efforts (sample) Activity Date Brief Description Evaluation Annual Meeting with State Vocational Rehabilitation Service Agency (SVRA) March 1, 2015 Met with SVRA to inform of Company s outreach and recruitment efforts for IWD s SVRA will begin posting all of Company s job openings starting in 2015 to expand Company s applicant pool Veterans Job Fair held at Hilton Hotel April 25, 2015 Participated at local job fair aimed at counseling veterans on employment applications and inclusion of veterans in the workforce Received 25 applications on the spot which resulted to hiring 2 qualified veterans. Posted jobs with academicdiversitysearch.com July 20, 2015 Posted jobs with ADS, Inc. for outreach towards minorities and women Received 20 candidates from this source.. but also be sure to 34

35 Other Recommendations Perform self-audit of other AAP requirements (sample) AAP Components AAP Requirements Compliance (Y/N) Date Last Inspected/Reviewed Remedial/Follow-up actions necessary (if any) Policy Statement (41 CFR (a) 41- CFR (a)) Review of Personnel Processes (41 CFR (b) 1-CFR (b)) EEO policy statement posted on bulletin boards Policy available in a form that is accessible and understandable to IWDs and Disabled Veterans EEO statement indicates top US executive support for AAP Periodic review of personnel process Reasonable accommodation provided for applicants and employees who are IWDs Y Y Y Y Y ongoing & reviewed on [DATE] ongoing ongoing & reviewed on [DATE] ongoing Accommodations (e.g. work hours restriction, provision of glove, etc) are being provided to 2 employees None COMPANY ensures that its communications with employees and applicants are accessible through s or internet both internally and externally and by those who may be IWDs and Disabled Veterans, such as providing wheelchair-accessible tables during interviews, and offer reasonable accommodation request communication channel to the applicants on the Career webpage of COMPANY corporate website. None Each new job posting is reviewed for applicable content to ensure that it does not include any discriminatory provisions or artificial barriers, that all of the job requirements are realistic, based on actual requirements necessary to do the job and the corresponding job requirements are updated based on business needs. None 35

36 Other Recommendations Perform self-audit of other AAP requirements (sample) AAP Components Review of Physical and Mental Qualifications (41 CFR (c)) 41-CFR (c)) Reasonable Accommodations (41 CFR (d) 41- CFR (d)) AAP Requirements Schedule a review of physical and mental qualification standards Identify qualification standards that screen out qualified IWDs and Disabled Veterans and ensure the qualifications are job-related and consistent with business necessity Review procedures for requesting, evaluation, and documenting reasonable accommodation Review instances where reasonable accommodation given/not given Compliance (Y/ N) Y Y Y Y Date Last Inspected/Reviewed ongoing ongoing Accommodations (e.g. work hours restriction, provision of glove, etc) are being provided to 2 employees Accommodations (e.g. work hours restriction, provision of glove, etc) are being provided to 2 employees Remedial/Follow-up actions necessary (if any) Each new job posting is reviewed for applicable content to ensure that it does not include any discriminatory provisions or artificial barriers, that all of the job requirements are realistic, based on actual requirements necessary to do the job and the corresponding job requirements are updated based on business needs. Each new job posting is reviewed for applicable content to ensure that it does not include any discriminatory provisions or artificial barriers, that all of the job requirements are realistic, based on actual requirements necessary to do the job and the corresponding job requirements are updated based on business needs. None None 36

37 Other Recommendations Perform self-audit of other AAP requirements (sample) AAP Components Anti-Harassment Procedures (41 CFR (e) 41-CFR (e)) External Dissemination of Policy, Outreach and Positive Recruitment (41 CFR (f) 41- CFR (f)) Internal Dissemination of Policy (41 CFR (g) 41-CFR (g)) AAP Requirements Document/review antiharassment procedures Make anti-harassment procedures available to all employees Send notification of AA Policy to subcontractors Document notifications sent to subcontractors Document outreach and recruitment efforts of IWDs Document outreach and recruitment efforts of protected veterans Incorporate the AA Policy in the employee policy manual Policy available in a form that is accessible and understandable to IWDs and Disabled Veterans Notify Union Officials of AA Policy Compliance (Y/ N) Date Last Inspected/Reviewed Remedial/Follow-up actions necessary (if any) Y ongoing None Yes, they are included in the Employee Handbook. COMPANY's Anti-harrssment policy is included in the Employee Handbook, which was last released in HR will review it on an ongoing basis. None Y [DATE] Notifications ed Y Y Y Y Y [DATE] [DATE] [DATE] Ongoing Ongoing Not Applicable - no union employees See subcontractor's acknowledgement on "AAP Notification" letter/ . See "Outreach & Recruitment Efforts Evaluation" See "Outreach & Recruitment Efforts Evaluation" Covered by EEO/AA Policy in Employee Handbook that all employees are acknowledged to the receipt of a copy. Policy is available ADP Portal and posted in breakrooms. AAP statement was ed to all U.S. employees on DATE and DATE respectively. 37

38 Other Recommendations Perform self-audit of other AAP requirements (sample) AAP Components AAP Requirements Determine whether known individuals with disabilities Audit and Reporting (IWDs) have had the System opportunity to participate in all (41 CFR (h) company sponsored education, (1)(iv) training, recreational, and social activities Compliance (Y/N) Y Date Last Inspected/Reviewed COMPANY has sent communications / notices / invitations to all employees, including employees with known disabilities, to participate in the following various activities: On [DATE] the company rolled out the Global Fitness Challenge. This was sent to all employees and everyone was given the opportunity to join. Two known IWDs did elect to join the challenge. Remedial/Follow-up actions necessary (if any) None Affirmative Action Training (41 CFR (j) 41-CFR (j)) Provide EEO and AA training to employees involved in personnel processes Y On [DATE], invitations were sent to join the Annual Company Picnic. Ongoing education The Employee Copy of the COMPANY AAP (CURRENT AAP START/END DATES) is shared with all U.S. employees, if requested. AAP Webinar training materials & tools are stored in shared directory for HR staff to study and learn. Individual guidance/coaching to hiring managers is conducted by HR team during the recruiting process of new opening. 38

39 Two Steps Back - Terminations The EEOC issues determinations of reasonable cause to believe discrimination occurred in less than 3.6% of its charge intake, over 75% of which involves TERMINATION decisions Adverse Impact? Yes! Then evaluate policy/process Voluntary Terminations Chilling effect can t get promoted, might as well leave policy issue Manager doesn t like working with women, couldn t take it any longer policy issue The job was harder than I thought - job description Involuntary Terminations Poor performance, under qualified for the job pre-employment test, job description Poor performance - personnel or policy issue? 39

40 Two Steps Back - Terminations Lilly-Ledbetter Fair Pay Act, Equal Pay Act, California Fair Pay Act, New York Achieve Pay Equity Act, Title VII, ADEA, ADA oh, my! Could a focus ensuring equality based on gender affect equality based on race? Yes! Bringing parity to one group could regress another group into significance Remember, do NOT only focus on particular problems/solutions in a vacuum that goes for areas such as outreach/recruitment, personnel activity and compensation 40

41 Addressing Disparity for Reasons other than Title VII Original Compensation Problem! Job Title Data Female Male Impacted Grp Expected Pay Diff ($) Diff (%) Recommended AcAon Analyst Count: GENDER Female $50,986 $5, % Cohort & Regression Avg: SALARY_ORIGINAL $45,019 $50,986 Avg: TIC Post Adjustment No Problem?! Job Title Data Female Male Impacted Grp Expected Pay Diff ($) Diff (%) Recommended AcAon Analyst Count: GENDER Female $50,986 $1, % Avg: SALARY_PostAdjustment $49,854 $50,986 Avg: TIC

42 Addressing Disparity for Reasons other than Title VII Females = Whites + Minority GENDER RACE SALARY_ORIGINAL Adjustment SALARY_PostAdjustment TIC Job Title FEMALE WHITES $49, $4, $54, Analyst FEMALE WHITES $49, $4, $54, Analyst FEMALE WHITES $47, $4, $52, Analyst FEMALE WHITES $47, $4, $52, Analyst FEMALE WHITES $47, $4, $52, Analyst FEMALE WHITES $47, $4, $52, Analyst FEMALE WHITES $47, $4, $52, Analyst FEMALE WHITES $46, $4, $51, Analyst FEMALE WHITES $45, $4, $50, Analyst FEMALE WHITES $45, $4, $50, Analyst FEMALE WHITES $45, $4, $50, Analyst FEMALE WHITES $45, $4, $50, Analyst FEMALE WHITES $45, $4, $50, Analyst FEMALE WHITES $44, $4, $49, Analyst FEMALE WHITES $44, $4, $49, Analyst FEMALE WHITES $44, $4, $49, Analyst FEMALE WHITES $44, $4, $49, Analyst FEMALE MINORITY $44, $4, $49, Analyst FEMALE MINORITY $44, $4, $49, Analyst FEMALE MINORITY $44, $4, $48, Analyst FEMALE MINORITY $44, $4, $48, Analyst FEMALE MINORITY $44, $4, $48, Analyst FEMALE MINORITY $42, $4, $47, Analyst FEMALE MINORITY $42, $4, $47, Analyst FEMALE MINORITY $40, $4, $45, Analyst FEMALE MINORITY $39, $4, $44, Analyst FEMALE MINORITY $38, $4, $43, Analyst 42

43 Addressing Disparity for Reasons other than Title VII Original Compensation No Problem! Job Title Data Minority White Impacted Grp Expected Pay Diff ($) Diff (%) Recommended AcAon Analyst Count: RACE Minority $48,666 $2, % Avg: SALARY_ORIGINAL $46,517 $48,666 Avg: TIC Post Adjustment Problem! Job Title Data Minority White Impacted Grp Expected Pay Diff ($) Diff (%) Recommended AcAon Analyst Count: RACE Minority $51,501 $2, % Cohort & Regression Avg: SALARY_PostAdjustment $48,820 $51,501 Avg: TIC

44 Two Steps Back - Compensation Lilly-Ledbetter Fair Pay Act, Equal Pay Act, California Fair Pay Act, New York Achieve Pay Equity Act, Title VII, ADEA, ADA oh, my! Solution Begin tracking more data, now! Establish meaningful pay ranges Conduct annual compensation reviews (regression and cohort) Where unexplained differences remain, consider adjustments Conduct review of the other group Always cover under A/C Privilege 44

45 What Should Be Our General Objectives? Understand OFCCP s priorities Where do they tend to focus their attention during Compliance Reviews? Be aware of the results for Disparity Analyses and not just Goals and Outreach Efforts Pay attention to the right things Give attention to the policies, programs, and procedures that may cause the most serious problems during audits Do NOT only focus on one or two areas in a vacuum (e.g., outreach and adding to headcount) If you consistently have the same goals every year, try to identify the root cause (e.g., lack of applicants, work environment, selection procedures, etc.) 45

46 Recommendations on Coordinating Efforts Someone in the organization needs to coordinate people involved in all aspects of the recruitment and selection process Need to secure senior management support so that all parties work together There should be information sharing about Effective recruiting processes The need for outreach to minorities, females, veterans, and individuals with disabilities Effective selection processes Proper dispositioning of candidates The ability to use applicant tracking systems and other HR tools to produce effective reports on applicants and hires Protect your brand 46

47 47

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