Academic journal article Public Personnel Management

Organizations' Relative Degree of Exposure to Selection Discrimination Litigation

Academic journal article Public Personnel Management

Organizations' Relative Degree of Exposure to Selection Discrimination Litigation

Article excerpt

The risk of lawsuits filed by job applicants who feel they have been victims of selection discrimination is a deeply felt concern of most organizations. Thousands of complaints of employment discrimination are filed each year with local, state, and federal agencies. The Equal Employment Opportunity Commission (EEOC) received over 80,000 complaints in 1997 alone; and employment discrimination lawsuits are increasing by more than 20 percent annually. (1) The organizational costs of selection discrimination can be staggering. The obvious costs are those related directly to litigation. Beyond that, if a court ruling goes against an organization, that organization may be required to make back-pay settlements to plaintiffs, pay punitive damages, and even change staffing procedures and devices. (2) Additionally, there may be less obvious or hidden costs to the organization as a result of selection discrimination lawsuits. For example, lawsuits may damage public images or reputations of organizations charged with discrimination. Furthermore, the organization with 'an image problem' may find it more difficult to recruit, hire, and retain high quality performers. Such an organization also may experience decreased demand for products or services clue to negative public perceptions. The price of an organization's stock may drop significantly. (3) Finally, the fear of possible litigation may lead organizations to use selection devices that are incorrectly perceived to be legally safer, rather than valid predictive selection devices that may be better, but are incorrectly perceived as legally risky. Research has found that organizational perceptions of the relative risks of using various types of selection devices do not always correspond to the actual risks. (4) In the competitive global business environment of today, organizations that do not use the best selection devices available may not survive.

In view of the direct and indirect costs of selection discrimination lawsuits, gathering more detailed and comprehensive information on the legal risks faced by different types of organizations would seem beneficial. Some organizations may face a relatively greater risk of exposure to litigation than other organizations because of significant differences related to industry types or job types. One previous study has, in fact, suggested the existence of differences in litigation rates as a function of those two factors. (5) That study, however, was based on a small sample, dealing only with discrimination charges arising from the use of 'pre-selection' or screening devices, such as reference checks, background investigations, medical exams, drug tests, and polygraph tests. A larger, more comprehensive study of discrimination charges associated with 'substantive' selection devices used by organizations may be needed to determine whether differences in litigation rates exist as a function of industry or job type. 'Substantive' selection devices are the primary tests or methods used by organizations to make precise predictions about future performance levels of job applicants. (6) Examples of substantive selection devices include job interviews, job knowledge tests, personality tests, cognitive aptitude tests, physical aptitude tests, work samples, and assessment centers.

The primary purpose of the current study is to assess the relative degree of risk of selection discrimination litigation exposure for different types of organizations. More specifically, the current study will report on results of a content analysis of nearly 400 federal court cases involving selection discrimination. It will provide actual empirical data on the relative degree of legal risk faced by different types of organizations. It also will examine and report the frequencies and percentages of lawsuits associated with different types of industries and different types of jobs. An attempt also will be made to determine the specific nature of legal problems encountered by different types of organizations. …

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