Selecting Employees 6/6/2012. Chapter Overview. Selection. Steps in the Selection Process. The Selection Process. Chapter 7

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1 Selecting Employees Chapter 7 McGraw-Hill/Irwin Copyright 2008 by The McGraw-Hill Companies, Inc. All Rights Reserved. Chapter Overview The Selection Process Validation of Selection Procedures Reliability Uniform Guidelines on Employee Selection Procedures Summary of Learning Objectives Selection Process of choosing from among available applicants individuals who are most likely to successfully perform a job Necessary prerequisites include Job analyses Human resource planning Recruitment The Selection Process Steps in the Selection Process Factors affecting exact nature of organization s selection process: Organization s size Types of jobs to be filled Number of people to be hired External pressures from EEOC or union Organizations use a multiple cutoff technique in selection Applicant must be judged through a series of screening devices Application forms Interviews Tests Applicant eliminated from consideration for job if any of these devices is unsatisfactory All screening devices must be validated if they produce adverse or disparate impact

2 Employment Application Form First step in most selection procedures Application provides basic employment information for use in later steps of selection process Can be used to screen out unqualified applicants EEOC Requirements Questions that should be eliminated from preemployment inquiries include Race, color, national origin, and religion Arrest and conviction records Credit rating Processing Normally a human resource personnel reviews information on application form Determines applicant s qualifications in relation to requirements of currently available jobs Another screening procedure Use of weighted application forms Assigns different weights to different questions Weights are developed by determining which item responses were given more frequently by applicants who proved to be higher performers but less frequently by applicants who proved to be poorer performers Weighted application forms are subject to validity requirements Accuracy of Information and Application Flow Record Accuracy of information Open to debate Full reliance may be prudent only with some means of verification Information can be verified through reference checking Employers require the applicant to sign a validity statement Employers view falsification of an application form as a serious offense that, if detected, normally leads to discharge Application flow record Form used to obtain information from a job applicant that could be used to illegally discriminate Applicant voluntarily completes this record Data and information from the applicant flow record can be used To provide statistical reports to EEOC or OFCCP In defense against charges of discrimination concerning employer s recruitment and selection activities Preliminary Interview Used to Determine if applicant s skills, abilities, and job preferences match any available jobs in organization Explain to applicant available jobs and their requirements Answer questions applicant has about available jobs or employer Usually conducted after applicant has completed application form Generally a brief, exploratory interview normally conducted by a human resource specialist Screens out unqualified or uninterested applicants Interview questions Must be job related Are subject to demonstrations of validity Formal Testing Supreme Court ruled that any procedure used to make selection decisions is to be construed as a test If test is used in the selection process and if selection process has adverse impact on legally protected groups, the EEOC requires employer To establish validity and reliability using procedures outlined in Uniform Guidelines on Employee Selection Procedures Many types of commercial tests are available Many of these tests have undergone validation and reliability studies One useful source is the Mental Measurements Yearbook Aptitude Tests Means of measuring a person s capacity or latent ability to learn and perform a job Frequently used tests measure Verbal ability Measure person s ability to use words in thinking, planning, and communicating Numerical ability Measure ability to add, subtract, multiply, and divide Perceptual speed Measure ability to recognize similarities and differences Spatial ability Measure ability to visualize objects in space and determine their relationships Reasoning ability Measure ability to analyze oral or written facts and make correct judgments concerning them on the basis of logical implications

3 Aptitude Tests Prior to passage of equal opportunity legislation, the general intelligence test was the most frequently used aptitude test Largely abandoned, since EEOC does not favor them because Such tests often contain questions that are not related to successful performance on the job Psychomotor Tests Measure a person s strength, dexterity, and coordination Some of the psychomotor abilities that can be tested include Finger dexterity Manual dexterity Wrist-finger speed Speed of arm movement Abilities such as these might be tested for hiring people to fill assembly-line jobs Job Knowledge and Proficiency Tests Job knowledge tests Measure the job-related knowledge possessed by a job applicant Tests can be either written or oral Applicant must answer questions that differentiate experienced and skilled workers from less experienced and less skilled workers Proficiency tests Measure how well applicant can do a sample of work to be performed Word processing test given to applicants for a secretarial job is an example Interest Tests Designed to determine how a person s interests compare with interests of successful people in a specific job Indicates occupations or areas of work in which the person is most interested Basic assumption in their use is that people are more likely to be successful in jobs they like Primary challenge with using interest tests Responses may not always be sincere Personality Tests Attempt to measure personality characteristics Generally characterized by Questionable validity Low reliability Presently have limited use for selection purposes Rorschach inkblot test Applicant is shown a series of cards containing inkblots of varying sizes and shapes Applicant is asked to tell what the inkblots look like to him or her Thematic Apperception Test (TAT) Applicant is shown pictures of real-life situations for interpretation With both these methods, individual is encouraged to report whatever immediately comes to mind Personality Tests Personality tests presently have limited application in selection decisions for these reasons Interpretation of responses requires subjective judgment and services of a qualified psychologist Responses to personality tests can also be easily fabricated

4 Polygraph Tests (Lie Detector) Device that records physical changes in the body as test subject answers a series of questions The polygraph records, on a moving roll of graph paper, fluctuations in Blood pressure Respiration Perspiration Polygraph operator makes a judgment as to whether subject s response was truthful or deceptive By studying physiological measurements recorded on paper Its use rests on a series of cause-and-effect assumptions Stress causes certain physiological changes in the body Fear and guilt cause stress Lying causes fear and guilt Polygraph Tests Theory behind use of a polygraph test assumes a direct relationship between Subject s responses to questions Physiological responses recorded on polygraph Polygraph machine itself does not detect lies; it detects only physiological changes The Employee Polygraph Protection Act of 1988, with a few exceptions Prohibits employers from conducting polygraph examinations on all job applicants and most employees Prevents use of voice stress analyzers and similar devices that attempt to measure honesty Does not prohibit paper-and-pencil tests and chemical testing, such as for drugs or AIDS Polygraph Tests Major exemptions to the law are as follows: All local, state, and federal employees are exempt from coverage, although state laws may be passed to restrict the use of polygraphs Industries with national defense or security contracts are permitted to use polygraphs Businesses with nuclear power related contracts with the Department of Energy may use polygraphs Businesses and consultants with access to highly classified information may use polygraphs Private businesses are also allowed to use polygraphs under certain conditions: When hiring private security personnel When hiring persons with access to drugs During investigations of economic injury or loss by employer Graphology (Handwriting Analysis) Involves using an analyst to Examine lines, loops, hooks, strokes, curves, and flourishes in a person s handwriting To assess person s personality, performance, emotional problems, and honesty Use of graphology is dependent on training and expertise of person (graphologist) doing the analysis Graphology has had limited acceptance by organizations in United States Acceptance of graphology is increasing, since Employee Polygraph Protection Act does not prohibit its use Drug and AIDS Testing Most common practice is to test current employees when their job performance suggests substance abuse and all new potential employees Most companies will not hire a potential employee who tests positive for drug abuse Urine sampling is one of the most common forms of drug testing Currently used technique involves measuring drug molecules from a person s hair to identify drug usage levels Some experts believe hair testing is more accurate than urine sampling Drug and AIDS Testing Most experts agree that testing for drug abuse alone among current employees is a less than satisfactory solution Testing can create an adversarial relationship in which employee tries to escape employer s detection Education and employee assistance provide a much more positive relationship This has led to establishment of employee assistance programs People with AIDS and people who test positive for HIV antibodies are protected in their jobs by Vocational Rehabilitation Act and Americans with Disabilities Act Voluntary workplace testing is not only permitted but is encouraged by some major health organizations These laws permit HIV-antibody testing in certain defined circumstances

5 Drug and AIDS Testing HIV testing is much more common among healthcare firms High potential for employee exposure to HIVinfected patients Sometimes, AIDS in the workplace has caused fear among employers and coworkers, who often seek to be separated from those infected by the virus If an HIV testing program is not to be considered as a violation of an employee s basic rights Employer should be able to show that the interests to be served by testing outweigh privacy expectations Genetic Testing Sophisticated medical tests use gene coding to identify individuals with gene structures that may make them susceptible to illness Concerns about legitimate uses of genetic information and what happens to any information obtained through genetic testing exist Although consensus exists that restricting healthcare benefits is not the goal of genetic testing, all parties are concerned about who will have access to the information Another concern of employers is what liability they may have for not using genetic testing if a valid test and a reason for testing exist Second or Follow-Up Interview Purpose is to supplement information obtained in other steps in selection process to determine the suitability of an applicant for a specific opening All questions asked during an interview must be job-related Equal employment opportunity legislation has placed limitations on the types of questions that can be asked during an interview 7-27 Types of Interviews Structured interview Conducted using a predetermined outline based on a thorough job analysis Interviewer maintains control of interview so that all pertinent information on the applicant is covered systematically Advantages Provides the same type of information on all interviewees Allows systematic coverage of all questions deemed necessary Unstructured interview Do not have a predetermined checklist of questions Open-ended questions are used Disadvantages Lack of systematic coverage of information Very susceptible to the personal biases of interviewer Advantages Provide a more relaxed atmosphere 7-28 Types of Interviews Stress interview Designed to place interviewee under pressure Interviewer assumes hostile and antagonistic attitude toward interviewee Purpose is to detect a highly emotional person Board or panel interviews Two or more interviewers conduct a single interview with applicant Group interviews Several job applicants are questioned together in a group discussion Panel interviews and group interviews can involve either a structured or an unstructured format Problems in Conducting Interviews Subject to same legal requirements of validity and reliability as other steps in the selection process Validity and reliability of most interviews are questionable Easy for interviewer to become either favorably or unfavorably impressed with job applicant based Initial impressions Interviewer often draws conclusions about the applicant within the first 10 minutes of interview Halo effect Occurs when interviewer allows a single prominent characteristic to dominate judgment of all other traits Overgeneralizing Interviewee may not behave exactly the same way on the job as during the interview

6 Problems in Conducting Interviews Other factors that cause problems during interviews include Personal preferences Prejudices Biases Interviewers with biases or prejudices tend to look for behaviors that conform to their biases Appearance, social status, dress, race, and gender have negatively influenced many employment interviews Conducting Effective Interviews Suggestions Careful attention must be given to selecting and training interviewers Should be outgoing and emotionally well-adjusted people Plan for interview should include an outline specifying information to be obtained and questions to be asked Should also include room arrangements Interviewer should attempt to put applicant at ease Interviewer should not argue with applicant or put applicant on the spot Applicant should be encouraged to talk Interviewer must maintain control and remember that primary goal of interview is to gain information that will aid in selection decision Conducting Effective Interviews Suggestions Facts obtained in interview should be recorded immediately Effectiveness of interviewing process should be evaluated Compare performance ratings of individuals who are hired against assessments made during interview Cross-check can serve to evaluate effectiveness of individual interviewers as well as that of overall interviewing program Reference Checking Can take place either before or after the second interview Most prospective employers contact individuals from one or more of the three following categories Personal references Have limited value since generally, no applicant will list someone who will not give a positive recommendation School references May be of limited value for similar reasons as for personal references Past employment references Most often used source and are in a position to supply most objective information Reference Checking Most frequently conducted by telephoning previous employers Many organizations will only answer questions if they are in written form Amount and type of information a previous employer is willing to divulge varies from organization to organization Verification of information on application form is the least to be verified Most employers are hesitant to answer questions about previous employees because of the threat of defamation lawsuits Reference Checking Privacy Act of 1974 Prevents government agencies from making employment records available to other organizations without consent of individual involved Fair Credit and Reporting Act (FCRA) of 1971 Requires private organizations to give job applicants access to information obtained from a reporting service Mandatory that applicant be made aware that a check is being made Most employment application forms now contain statements which must be signed by applicant, authorizing the employer to check references and conduct investigations

7 Physical Examination Normally required only for individual who is offered the job Job offer is often contingent on individual passing physical examination Exam is given to determine Whether applicant is physically capable of performing the job His or her eligibility for group life, health, and disability insurance Normally one of the last steps in the selection process due to expenses involved Caused many organizations to have applicants complete a health questionnaire with their application form If no serious medical problems are indicated, applicant usually is not required to have a physical examination Physical Examination Rehabilitation Act of 1973 and Americans with Disabilities Act of 1990 Caused many employers to reexamine physical requirements for many jobs These Acts Do not prohibit employers from giving medical exams Encourage employers to make medical inquiries directly related to applicant s ability to perform jobrelated functions Require employers to make reasonable accommodations to help handicapped people perform the job Americans with Disabilities Act Requires that a physical exam cannot be conducted until after a job offer has been extended Making the Final Selection Decision Making the Final Selection Decision The final step is choosing one individual for the job Assumption is that there will be more than one qualified person Value judgment based on the information gathered in previous steps must be made to select most qualified individual Chances of making a successful judgment improve if previous steps have been performed efficiently Responsibility for making final selection decision differs within different levels of management in different organizations In many organizations, the human resource department Handles completion of application forms Conducts preliminary interviews, testing, and reference checking Arranges for physical exams Diagnostic interview and final selection decision usually left to manager of the department 7-39 In some organizations, human resource department handles all of the steps up to the final decision Human resource department gives the manager a list of three to five qualified applicants Manager then chooses the individual believed to be the best employee based on all the information provided Many organizations leave the final choice to the manager with the job opening Subject to approval of those at higher levels of management In some organizations, the human resource department handles all the steps in the selection process, including the final decision In small organizations, the owner often makes the final choice 7-40 Making the Final Selection Decision Validation of Selection Procedures Peer involvement Involves peers in the final selection decision Has been used primarily in selection of upper-level managers and professional employees Naturally facilitates acceptance of new employee by work group For selection of managers and supervisors, assessment centers are also sometimes used Utilizes a formal procedure aimed at evaluating an individual s potential as a manager/supervisor Determines his or her developmental needs Procedure involves Interviews Tests Individual and group exercises Job analysis is essential in development of a successful employee selection system Job descriptions and job specifications developed through job analysis Job description Facilitates determining how successful performance of job is to be measured These measures are called criteria of job success Possible criteria of job success include Performance appraisals Production data (such as quantity of work produced) Personnel data (such as rates of absenteeism and tardiness)

8 Validation of Selection Procedures Job specification Facilitates identifying factors that can be used to predict successful performance of the job These factors are called criterion predictors Possible criterion predictors include Education Previous work experience Scores on tests Data from application forms Previous performance appraisals Results of employment interviews Validation of Selection Procedures Validity and reliability aids in Selection of new employees Promotion decisions or areas where selection decisions are made Validity Refers to how accurately a criterion predictor predicts criterion of job success Reliability Refers to extent to which a criterion predictor produces consistent results if repeated measurements are made Important to note that Criterion predictor (test score) can be reliable without being valid It cannot be valid if it is not reliable Reliability is necessary but not sufficient to show validity of a criterion predictor Reliability of a criterion predictor plays an important role in determining its validity Validation of Selection Procedures Some criteria such as results of performance appraisals can be used as either a criterion predictor or a criterion of job success If past performance appraisals are used to forecast how successfully an employee will perform a different job, then results of performance appraisal system are criterion predictors If test scores are the criterion predictor, then performance appraisal results are the criterion of job success Three methods can be used to demonstrate validity of a criterion predictor Criterion-related validity Content validity Construct validity Relationship between Job Analysis and Validity Criterion-Related Validity Established by collecting data and using correlation analysis to determine relationship between a predictor and criteria of job success Correlation analysis A statistical method used to measure relationship between two sets of data Degree of validity for a particular predictor is indicated by magnitude of coefficient of correlation (r), which can range from +1 to 1 Both +1 and 1 represent perfect correlation Zero represents total lack of correlation or validity A positive sign (+) on the coefficient of correlation Means the two sets of data are moving in same direction A negative sign ( ) on the coefficient of correlation Means the two sets of data are moving in opposite directions Criterion-Related Validity Criterion predictor never correlates perfectly with a criterion of job success Significant issue in validity Degree of correlation required between criterion predictor and criterion of job success in order to establish validity Uniform Guidelines on Employee Selection Procedure state that No minimum correlation coefficient is applicable to all employment situations Correlation coefficients rarely exceed 0.50 Correlation of 0.40 is ordinarily considered very good Correlation of 0.3 or higher is acceptable Correlation of less than 0.30 would not be considered acceptable Two primary methods for establishing criterion-related validity are predictive validity and concurrent validity

9 Predictive Validity Predictive Validation Process Established by Identifying a predictor such as a test Administering test to the entire pool of job applicants Hiring people to fill available jobs without regard to their test scores At a later date Test scores are correlated with criteria of job success to see whether those people with high test scores performed substantially better than those with low test scores Used infrequently because of its cost and slowness To use this method Large number of new employees must be hired at the same time without regard to their test scores Potentially, an organization may hire both good and bad employees For criteria to be predictive, all new employees must have equivalent orientation and training Concurrent Validity Concurrent Validation Process Determined by Identifying a predictor such as a test Administering test to present employees Correlating test scores with present employees performance on job If an acceptable correlation exists, test can be used for selection of future employees Disadvantage If either racial or sexual discrimination has been practiced in the past, minorities and women will not be adequately represented Among present employees in a particular job, poorer performers are more likely to have been discharged or quit and best performers have frequently been promoted Criterion-related validation procedures preferred by EEOC in validation studies, but cost and time act as a drawback Content Validity Content validity Refers to whether content of a selection procedure or selection instrument such as a test is representative of important aspects of job performance Especially useful in situations where number of employees is not large enough to justify use of empirical validation methods To use it, an employer must Determine exact performance requirements of a specific job Develop a selection procedure or selection instrument around an actual sample of work that is to be performed Construct Validity Construct validity Refers to extent to which a selection procedure or instrument measures degree to which job candidates have identifiable characteristics that have been determined to be important for successful job performance Examples of job-related constructs might include Verbal ability Space visualization Perceptual speed

10 Reliability Refers to reproducibility of results with a criterion predictor For example A test is reliable to extent that the same person working under the same conditions produces approximately the same test results at different time periods A test is not reliable if a person fails it on one day but makes an excellent grade when taking it again a week later (assuming, of course, that no learning has taken place in the meantime) Three methods can be used to demonstrate the reliability of a criterion predictor Suppose that scores on a test are to be used as criterion predictor Methods to Demonstrate Reliability of Criterion Predictor Test-retest Involves administering test to a group of employees and later, usually in about two to four weeks, giving the same group the same test Correlation analysis is used to determine degree of correlation between two sets of scores Higher the correlation coefficient, greater the reliability of test Results of correlation can be influenced by whether members of the group studied during the time between tests Methods to Demonstrate Reliability of Criterion Predictor Parallel (or alterative) forms Under this method two separate but similar forms of a test would be constructed Same group of employees would be tested at two different times using alternative forms of the test Correlation analysis is used to determine degree of correlation between the two sets of scores Higher the correlation coefficient, greater the reliability of test Split-halves Under this method a test is administered to a group of employees Simplest and easiest method of determining reliability Results of test are randomly split into two equal groups Scores of the two equal groups are correlated Higher the degree of correlation, greater the reliability Uniform Guidelines on Employee Selection Procedures Uniform Guidelines on Employee Selection Procedures, more commonly referred to as Uniform Guidelines, adopted and published by the EEOC Office of Personnel Management Department of Justice Department of Labor Uniform Guidelines on Employee Selection Procedures Uniform Guidelines are designed to provide the framework for determining proper use of tests and other selection procedures Employment decisions include but are not limited to Hiring Promotion Demotion Membership (e.g., in a labor organization) Referral Retention Licensing Certification Selection for training Transfers Uniform Guidelines on Employee Selection Procedures Contain technical standards and documentation requirements for validation of selection procedures Broadly define selection procedures to include decisions regarding Hiring Promotion Selection for training programs Intended to be consistent with generally accepted professional standards for evaluating selection procedures Permit criteria-related, content, and construct validity studies Employers encouraged to consider available alternatives with less adverse impact for achieving business purposes All validation studies must be thoroughly documented Uniform Guidelines specify in detail types of records to be kept Specific guidelines also provided for conducting job analyses

11 Adverse (or Disparate) Impact Adverse (or Disparate) Impact Fundamental principle underlying Uniform Guidelines Employment policies and practices having an adverse impact on employment opportunities are illegal unless justified by a demonstration of job relatedness Applies to any race, sex, religion or national origin group Adverse impact Condition that occurs when selection rate for minorities or women is less than 80 percent of selection rate for the majority group in decisions pertaining to Hiring Promotions Transfers Demotions Any selection decision Selection procedure that has no adverse impact is generally considered to be legal If adverse impact exists, however, it must be justified on basis of job relatedness Validation that demonstrates relationship between selection procedure and performance on the job Uniform Guidelines adopt a rule of thumb known as 4/5ths or 80 percent rule Is the limit used to determine whether or not there are serious discrepancies in hiring decisions and other employment practices affecting women or minorities This rule is not a legal definition of discrimination but a practical device for determining serious discrepancies in hiring, promoting, or other employment decisions Determining Adverse Impact in an Employer s Workforce Determining Adverse Impact in an Employer s Hiring Decisions Where Adverse Impact Exists: The Basic Options Steps required to be undertaken by the Uniform Guidelines, once existence of adverse impact is established Employer has option to modify or eliminate procedure that produces adverse impact If employer does not do so, it must justify use of the procedure on grounds of job relatedness This normally means showing a clear relation between performance on selection procedure and performance on the job In the language of industrial psychology, employer must validate the selection procedure 7-65 Summary of Learning Objectives Outline the steps in the selection process Describe aptitude, psychomotor, job knowledge, proficiency, interest, and personality tests Explain a polygraph test Describe structured and unstructured interviews Define validity Explain predictive validity Explain concurrent validity Describe content validity Discuss construct validity Define reliability Define adverse (or disparate) impact