Defining an "Applicant" in the High Tech World: Emploment Law Alert, March 2004

Agencies release long-awaited guidance on application of the UGESP to Internet applications.

In the March 4, 2004, the Federal Register, the Equal Employment Opportunity Commission ("EEOC"), the Office of Federal Contract Compliance Programs, the Department of Labor, the Department of Justice, and the Office of Personnel Management jointly issued long-awaited guidance on how the Uniform Guidelines on Employee Selection Procedures ("UGESP") will apply to Internet applicants. This alert discusses the guidance provided and how it affects employers in their recruitment and hiring practices.

The "Applicant" Question: A Short History

The original UGESP (EEOC guidelines, 29 CFR part 1607), were issued in 1978 (1) to identify the information employers were required to keep demonstrating that their employment selection procedures did not have a disparate impact on protected groups; and (2) to establish methods employers might use to validate test and selection procedures. The UGESP apply to all employers subject to Title VII (fifteen or more employees) and/or Executive Order 11246 (government contractors or "subcontractors" with executive agency government contracts in excess of $10,000). To clarify the application of the guidelines, the issuing federal agencies adopted a series of Questions and Answers in 1979 and 1980. With respect to the recordkeeping requirements, the UGESP required employers to track race, ethnicity, and gender data on their "applicants." Who constituted an "applicant," however, was less than clear. The only guidance provided was in Question and Answer Number 15 (March 2, 1979), which defined an "applicant" in very general terms:

The precise definition [of an applicant] depends upon the user's recruitment and selection procedures. The concept of an applicant is that of a person who has indicated an interest in being considered for hiring, promotion, or other employment opportunities. . . (Emphasis added.)

Of course, the UGESP and the Questions and Answers clarifying them were promulgated in a "paper and pencil" era, long before the explosion of the Internet and the World Wide Web. Employers who now do most of their recruiting online or who receive most of their resumes online had serious problems determining which of the many individuals submitting various information electronically became "applicants" who then had to be tracked.

With very little guidance from the UGESP, employers were forced to grapple with many questions:

• If I receive five hundred unsolicited resumes per day via the Internet, must I track the applicant date for all five hundred individuals because they have "indicated an interest" in working for my company?
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• If I search a job database for purposes of filling a certain position, are all of the resumes contained on that database "applicants" because they have indicated an interest in being employed by companies that have access to the database?
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• If I receive one thousand electronic applications in response to one job posting, are all of these individuals "applicants," even if the majority of them do not have the necessary educational background for the position?

Recognizing the post–1978 shift in hiring practices from paper applications to electronic transmissions, in 2000 the Office of Management and Budget ("OMB") issued a directive to the relevant agencies to evaluate whether the UGESP Questions and Answers should be amended to address the prevalent use of technology in recruiting and hiring. The agencies have finally issued their response.

In the March 4 response, the relevant agencies adopted five Additional Questions and Answers explaining UGESP's application to technology. Interested parties who wish to comment on these Additional Questions and Answers must submit comments by May 3, 2004. The effective date of the Additional Questions and Answers will be published in the Federal Register on a subsequent date by the EEOC

Summary of Guidance Provided by the Additional Questions and Answers

The Additional Questions and Answers published on March 4 make the following points:

• For recordkeeping purposes, in the context of the Internet and related electronic technologies, an individual becomes an "applicant" when:
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  • The employer has acted to fill a particular position;
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  • The individual has followed the employer's standard procedures for submitting applications; and
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  • The individual has indicated an interest the particular position.
  
  
• Some concrete applications of these new provisions were then provided:
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  • An employer has individuals interested in a particular position fill out personal data forms, which include information on where geographically the person is willing to work. The employer seeks to fill two positions in the New York area and does a search of the personal data forms that have been completed. The employer has two hundred hits. Out of those two hundred hits, one hundred respond to the employer's inquiry regarding the open positions. All one hundred individuals who responded would be considered applicants, even if the employer chooses to interview only twenty-five. Not every person who fills out the personal data form, however, would be an applicant, because many did not indicate they were available to work in New York.
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  • An employer requires everyone that applies online for a certain position to fill out a data form. Only employees who complete this step should be considered applicants.
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  • An individual sends a resume through the Internet expressing interest in a category of positions at a company (e.g., marketing opportunities) or just general interest in working at the company. That individual would not be considered an applicant. However, if that individual completes an application form for a particular position online, that person becomes an applicant.
  
  
• The Additional Questions and Answers clarify that the UGESP do not apply to recruitment activities. A recruiter that searches huge personal Web sites and resume databases for recruits is not required to comply with the recordkeeping requirements of the UGESP for its recruitment activities. However, recruitment activities are still subject to Title VII and Executive Order 11246 scrutiny.
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• The search criteria used by employers to narrow applications are subject to disparate impact analysis. For example, an employer has a database of over two thousand personal data profiles. It is seeking to fill two administrative assistant positions. It searches the database to find applicants who have a college education. It pulls out 120 resumes out of the two thousand that meet this criteria. It sends a notice to the 120 individuals and tells them that, if they are interested in the administrative assistant position, they must fill out an application and submit it by a certain date. Only twenty-five return the application by the deadline. Only those twenty-five individuals are applicants for purposes of the UGESP. The use of college education as a screening mechanism, however, is still subject to a disparate impact analysis, using as a comparison census or workforce data.
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• Employment tests administered online are subject to UGESP, even if they are used by recruiters, because they are considered a "selection device."
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• Federal nondiscrimination laws apply to use of the Internet and related technologies for recruitment and selection.

Suggestions for Employers

Employers who use the Internet and other technologies for selection and recruitment should consider implementing the following measures:

• Develop guidelines for human resources personnel as to when inquiries about race, ethnicity and gender must be made of potential applicants. Create an electronic "tear away" sheet for that purpose and make sure the use of such data conforms to the UGESP.
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• Require all applicants for positions to fill out a personal data form or application, and set a cut-off date for completing this information.
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• Review all search terms used to select resumes for positions to ensure that the criteria used can be tied to the job at issue.
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• Inform all individuals that submit unsolicited electronic resumes or applications that they must resubmit their information in response to a specific job posting.
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• Have closing dates on all job postings and make sure all postings are taken off the company's Web site as soon as they are closed.

By adopting a few simple procedures and ensuring that human resources staff handling the recruitment and selection process are well trained, employers will be able to use the advantages of technology for recruiting and hiring while still adhering to UGESP requirements.