Employers have started hiring again and are often overwhelmed with huge numbers of resumes, even for entry-level positions. Some companies have decided that an effective way to identify the best candidates is to refuse to consider job applicants who are currently unemployed. But a number of human resources professionals, the Equal Employment Opportunity Commission (EEOC), and employment law attorneys discourage the practice and say it could lead to discrimination claims.
“This practice not only can lend itself to lawsuits but is, frankly, in my opinion quite short-sighted,” said Susan Fahey Desmond, an attorney with Watkins Ludlam Winter & Stennis in Mississippi and Louisiana and author of the Mastering HR: Hiring report. “A lot of potentially good applicants may have various reasons for not being employed that are unrelated to any problems in their employment history,” Desmond continued. “For example, someone may have taken time off to raise young children or . . . may have wanted to try to start a business of his or her own that simply did not work out.”
Desmond also pointed out that the EEOC has said such a practice may have a disparate impact on any number of groups protected under Title VII of the Civil Rights Act of 1964 and the Americans with Disabilities Act (ADA). According to the Bureau of Labor Statistics, in January 2011, the total unemployment rate was 9 percent, but for African American adults the rate was 15.7 percent and for Hispanic workers was 11.9 percent. William Spriggs, assistant secretary for policy at the U.S. Department of Labor (DOL), said such practices would reduce the pool of disabled applicants by nearly 50 percent.
“If the practice did indeed disqualify members of a protected class at a disproportionate rate, the employer would have to have a business justification for such a practice,” Desmond said. “I think the employer would find it difficult to justify this practice to a court’s satisfaction.”
Mastering HR Special Reports: Hiring
On February 16, the EEOC held a public meeting to examine what it calls an “emerging practice” by businesses to not consider the unemployed when hiring. According to Helen Norton, associate professor at the University of Colorado School of Law who testified at the meeting, employers and staffing agencies have publicly advertised jobs in fields ranging from electronic engineers to restaurant and grocery managers to mortgage underwriters with the explicit restriction that only currently employed candidates will be considered.
An employment lawyer who testified at the meeting expressed doubt about the extent of the problem, and a representative of the Society of Human Resources Management said they are not aware of this practice being in regular use.
Mastering HR Special Report: Discrimination
What HR pros think
This issue also stirred up a lively debate on Employers Forum, the discussion center on HRHero.com. We asked several HR pros who participate in the Forum to share their thoughts on the practice.
Supervisors often dole out sympathy points. “I try to approach all applicant screening ‘filters’ the same way. Is it illegal? In this case it’s not,” said Frank Evans, human resource director at Alliance Credit Union First in the St. Louis, Missouri, area. “Second, is the filter likely to improve the quality of the applicants more than it harms the quantity? I try not to second-guess other HR professionals, and in this case I would like to assume those companies have decided there is some objective evidence that currently employed applicants would be a better fit for the opening and there will be plenty of currently employed applicants from which to choose. The other possibility is a bit more odious — that someone in a key position has a bias against the unemployed, whether it comes from personal experience or just assumptions about their worthiness. You just hope that’s not the case.”
This is an issue Evans has grappled with in his own organization. “About a year ago we were restaffing our mortgage department. The industry had just been hit by a lot of significant changes in the regulatory environment, and it soon became apparent that people who had been out of the business for six to eight months were seriously behind the curve. We could afford to have one or two people who had to get up to speed, but we didn’t have the luxury of staffing an entire department that way. At some point, I started looking for applicants who were currently employed in the business.
“When I do have a problem [with considering unemployed applicants], it tends to run the opposite way,” Evans explained. “That is to say, I have some supervisors who overcompensate in favor of the underdog, and they are prone to throw ‘sympathy points’ to an unemployed applicant. A lot of our managers identify with people who have had to overcome obstacles to get where they’re at. As a result, they look so hard for underdogs they pass over candidates with a better chance of succeeding, to the point of disregarding college degrees, or relevant skill sets obtained in a different industry. I have to remind them it’s silly to search for a diamond in the rough when you have several diamonds already in gold settings waiting to come on board.”
HR Guide to Employment Law: A practical compliance reference manual covering 14 topics, including hiring and discrimination
Unemployed can start work immediately. Renea Dennison, manager of financial services and human resources for a preferred provider organization and insurance agency, said, “My gut feeling says that either [companies that don’t consider unemployed applicants] believe the unemployed don’t deserve to work (they have messed up on a previous job), or they are overwhelmed by the number of applicants and are using this as an excuse to pare it down. I believe the rationalization for either of these reasons to be very poor and short-sighted.
“First, though employers try to get rid of the chaff in downsizing, they often are forced to lose good employees in the process, and once you cut down far enough, every employee is a good employee,” Dennison explained. “Besides, even someone who is considered ‘chaff’ at one organization can be a star at another. Employees do well for a variety of reasons — a change of duties or supervisor can make a big difference. In addition, in this kind of economy, many businesses with great employees have been forced to close.
“Second, most people who are unemployed are grateful for the opportunity, and are often willing to work harder as they have come to appreciate having a job so much more,” Dennison added. “You can usually get them to start right away, too, without having to wait for them to serve out some kind of notice to their current employer. Third, there is the possibility you might find yourself facing some kind of disparate-impact claim by excluding too many people of a certain age group or color by this practice.”
Basic Training for Supervisors, including hiring
“Go into every interview with open mind.” Sarah Hulsey, talent manager for Rising Medical Solutions in Chicago, Illinois, said she, too, would discourage employers from not considering unemployed applicants.
“My views on this subject have changed quite a bit over the past three years due to what has happened in the U.S. economy,” Hulsey said. “I feel that the best course of action with any candidate is to review their resume for qualifications, ask probing questions regarding gaps in employment and recent work history, and to go into every interview with an open mind. Not only does this keep unnecessary influences from tainting your perception of the candidate, it helps to avoid any claims of preemployment discrimination.”
Audit your interviewing policies and practices with the Employment Practices Self-Audit Workbook
Avoid-the-unemployed policy could backfire. Consistency in hiring practices is cited by employment lawyers as crucial in avoiding and defending against discrimination claims in hiring. Paul Knoch, human resources manager for Cannon Beach Conference Center in Oregon, points out that adopting a policy of not hiring the unemployed could cause an employer to violate its own policy if a company found a great applicant who was unemployed and decided to hire that person.
“From an HR perspective, this policy raises a number of concerns,” Knoch said. “First, does this policy adversely impact minorities or other protected classes? Historically, minorities have been unemployed in disproportionate numbers. So a policy discriminating against the ‘unemployed’ could be seen as a pretext for discriminating against minority applicants. The second concern I would have is that this policy will screen out qualified candidates. Worse, if the perfect applicant were to show up and they happen to be unemployed, you would have to violate your policy in order to hire them.”
State-by-state comparison of 50 Employment Laws in 50 States, including discrimination laws
“I am one of those unemployed.” For Denyse Loar, who worked in human resources for more than 15 years, the question of considering unemployed applicants is very personal. She began working in HR for a company in 1996. By 2009, the company had been through several layoffs and finally closed. She’s been job-hunting for two years with no luck. She has an associates degree and 15 years of experience. As she looked for work, though, she realized that she needed a bachelors degree and returned to school.
“I would not feel right working for a company that will not consider unemployed applicants,” Loar said. “I am one of those unemployed, and I know how hard it is to just get an interview. If you don’t qualify, you are not even getting in the door. If you are unemployed, you know about struggling and working hard, and those people do not take anything for granted. They are probably your hardest workers. I’ve been on both ends of this spectrum. I’ve been employed and had the luxury of a steady income, and I’m unemployed and know what it’s like looking for a job and making ends meet. Just because someone is unemployed or doesn’t have a degree does not make them an unlikely candidate for a job.”
Employers who feel this way are losing out on valuable candidates. Applicants who are not employed, though lay offs, etc. should not be punished because of the economy. Not all candidates that come for an interview, who are presently employed, are not always the stellar candidates. Give everyone a fair chance, employed or not employed.
Hi,
I loved your article “Unemployed Job Applicants Pose Practical and Legal Dilemmas for HR” but I think there is a group of us that could have been included. That group would be retirees who have completed their 30 years with a company and need a job to make ends meet because they are not old enough to draw their social security benefits.
Even though ‘age’ was mentioned in the article, I am appauled at the companies that provide a on-line job searches and application but then require you to enter you SSN and date of birth before you can submit the application. I applied on-line with a very reputable company and continue to see on their job site that I’m not considered. I get email updates 2-3 times a week with new job announcements from that company but have not heard why I’m not considered. I can only assume it’s because of my age, or that I’m not currently employed.Thanks again for a great article.
I would think as an HR Manager , that asking for SS# and DOB before hire – whether on.line , verbally or on paper – is a bad practice that can open up a real can of worms . Any company that does this, does it at its own risk.
The clerk that I hired- she was unemployed at the time, but she has been the greatest ! I went with my gut feeling after the interview.
What it tells me is that those who are programming the filters are not doing so with intelligence. There are two things that should occur and don’t.
1. If you are getting too many resumes then your filters are not tight enough or they are the wrong filters to begin with.
2. As Njean pointed out, HR is not even dignifying Njean with any kind of response, why not program the HRIS system to send out automatic email notifications a) when the resume is received and when the decision is to be made (we all have deadlines), b) when the candidate has been selected for an telephone screening/interview and to expect a call in the next few days, c) when the candidate has been disqualified from the on-boarding process. Of course it would be helpful for the candidate to know exactly why they are being disqualified so that they either don’t apply again (clogging up an already bottle necked system) or can do something about it.
The other side of the Recruiting coin is that candidates use the same old tired resume they have been using for years. A standard chronological resume does not convey the knowledge, skills and abilities this person brings to the table. What can you do for me is what a recruiter is looking for. If you cannot answer that question you have no business answering the ad.
Just my opinion
The hiring authorities or screeners who discriminate against the unemployed and older job seekers better pray that they never have to walk this road. All my life I have heard that if you work hard and educate yourself, you will be sucessful. However, folks who played by all the rules prior to the recession have quickly learned that the old rules have been tossed out, and the new rules are a crap shoot. The next time someone tells me during an interview that they have concerns about whether I can perform at a lower level, I plan to get up and leave. This will save me a lot of time. I have never been so humiliated in my life.
An employer should never discriminate in this manner. That noted, we know that they do. Part of the problem is that those who are unemployed, either prior to or after they left their former place of employment, allowed their skills to lapse so badly, that they are no longer up-to-date with the market place. I just interviewed a secretary who barely typed 50 wpms and stated that in her last place of employment the employer had antiquated software and used MS Word 2000. When I noted to the applicant, that the unemployment office, offered, free of charge, access to all on updated software, the applicant smiled at me and looked surprised. When I asked why the applicant did not keep up with the market place on her own time, she looked shocked at the very thought.
Nowadays especially with computers in elementary schools, employers expect interviewed employees to be far more computer literate then ten years ago. Employers no longer have the budget to cross train employees. They need individuals that will be able to get their hands dirty immediately. All those concepts of employee engagement are nice for the individual who created the pretty words but a good deal of employers are still trying to survive the recession.
These individuals that for whatever reason; either were placed in or sat in box, now that the box no longer exists, expect the same compensation that they received while in the former employer’s box. The problem is that employers have stopped paying the salaries they used to pay. I recently interviewed an AA who was earning 75k. (We are offering to the applicants 60 percent of the afore noted salary) The former employer explained plainly that the termination was a financial decision. It had nothing to do with skills and would provide glowing recommendations. Yes, our experienced population is being downsized because of their salaries but the employer could hire three entry level individuals for the same salary (not including benefits of course) under the supervision of the manager.
The individual has been out of work for over two years attempting to find a salary similar to the one in the former position because no employer can afford to pay it. Yes, the employer is losing a top drawer experienced individual. The employer is also willing and apparently able to live without that person. When I mentioned that I needed someone who also knew MS Excel, the applicant stated that she would happy to learn. I wondered why a person who has been out of work for two years hasn’t taken on the responsibility to learn it on their own. Even if the person has no internet access, the individual can go to the library and there are a myriad of people who can help.
My question to the applicants who are out of work for that period of time is how do they know that their skills are up-to-date and what have they been doing to keep their skills that way. Take courses (there are still free courses out there)? Volunteer? When I am met with a blank stare, I know that I have not found the right match for my position.
My husband is one of those “almost 2 years unemployed” AND over 50 – not old enough to retire and still needs an income. After 19 years with a GOCO situation, he was layed off due to plant closure. Since that time, he has had several positions, being layed off from almost every one due to lack of work, or company closure. He has diverse experience, OSHA training, hands-on supervision and a lot of labor experience. He can’t even get an interview! At this point, making about $2/hour on unemployment that is about to run out, he applies for anything available. We assume he is being passed over due to age, over-qualification and who knows what else? Now we have to be concerned that he is being weeded out simply because he is unemployed? What next? How many more strikes against him can we find? He is a dedicated, accountable and loyal employee simply trying to get back to getting a paycheck, even if just for minimum wage. He has a good 15 years left before being able to retire and apply for pension or SS.
After filling out an application online for an employer the other day, he received a rejection email the very next day and this was on a Saturday and Sunday. This tells me that perhaps the company has their computer screening out anyone who is unemployed without even considering qualifications.
As an HR manager at a small company, I would be ashamed if our company were to elect to screen candidates in this manner.
Actually, I applied directly on their business web site. I get am email (filter) directly from them with relating job openings. I’ve just applied for 4 more positions, mainly cashier or floor sales. Only been out of work for a few months and my IT skills are probably more up to date than most who are working. I recently completed the exam, and passed to be a Tax preparer, and did a 3 day consulting job. I am not looking to get the same salary as my previous long-term job…just something help me make ends meet. The last time a took a typing test my aveg was 73 with 3 errors. I don’t think the company wants someone with IT skills…just cashier and sales experience; so it’s hard to get a job in that area since I don’t have those skills.
btw.. I volunteer 1 day a week for a national organization that helps low-income families with affordable housing. I personally went to the company last week and spoke to an HR rep. I was told that I should keep applying and that they were getting a lot of applicants who had years of experience in sales because their previous company went out of business.
I was recently told on a phone interview that the employer wanted someone who was currently employed. Odd, since they had my resume’ that they even called.
I have returned to college and am working on my MBA..I try not to see how far away the mountain is but how far I have come.
Frankly, the employment horizon in HR field is gloomy.