Applicants, Candidates, and Jobs Filled... Oh My!

As outlined in 41 CFR 60-3, contractors are required to analyze personnel activity to determine if there are barriers to equal employment for protected classes. One method of determining whether these barriers exist for applicants is to evaluate whether there are statistical differences in selection rates between groups. However, before you can determine the selection rate, you need to know who to include in the analysis. For contractors who are familiar with the rules and guidance that apply to sex and race/ethnicity analyses, the recent guidance from OFCCP on the analyses required under Section 503 and VEVRAA may leave them feeling like they aren’t in Kansas anymore.

One major consideration when conducting adverse impact analyses is “how should I treat internal applicants?” For several decades, this question was answered by the 1978 Uniform Guidelines on Employee Selection Procedures (UGESP), largely because it has been well-accepted in the courts and was codified in the Code of Federal Regulations. In the UGESP FAQ, the terms “applicant” and “candidate” are used to distinguish between those who express interest in a job and those who are considered without expressing interest in the job. This means that if an internal employee applies to one of your requisitions, they are an applicant – along with the external job-seekers who applied. In the past, the only reason a job-seeker would be removed from the analysis would be if he or she withdrew from consideration.

With the advent of the Internet and related technology, employers often found that jobs posted on the Internet would receive an extremely large number of applications. This was problematic for several reasons. First, contractors were unable to review all of the applications that were received, leading to many job-seekers being “rejected” without ever being considered. Secondly, with such large applicant pools, even small differences in selection rates were statistically significant.

OFCCP’s 2005 Internet Applicant Recordkeeping Rule provides contractors with a consistent, 4-pronged approach to determining if someone meets the criteria to be considered an applicant in an adverse impact analysis:

1. The individual submits an expression of interest in employment through the Internet or related electronic data technologies;
2. The contractor considers the individual for employment in a particular position;
3. The individual's expression of interest indicates the individual possesses the basic qualifications for the position; and
4. The individual at no point in the contractor's selection process prior to receiving an offer of employment from the contractor, removes himself or herself from further consideration or otherwise indicates that he or she is no longer interested in the position.

If the job-seeker does not meet all four of these criteria, they are not an “applicant.” Job-seekers who do not possess basic qualifications, or who are not considered, do not need to be included in an adverse impact analysis. This also means that if a contractor fills an opening with an internal candidate before considering any external candidates, that none of those external candidates need to be considered. If the contractor does not consider the job-seeker, they do not need to be included in the adverse impact analysis.

Unfortunately, it is unclear how these standards may apply to analyses conducted under Section 503 and VEVRAA, in large part because the analyses are not described as “applicant” and “promotion” analyses.

Contractors must collect, maintain, and analyze data related to the total number of applicants (internal and external) as well as the number who identify as a protected veteran or individual with a disability. They must also report on the total number of hires (which an OFCCP FAQ defines as selections that result from a competitive process, whether applicants were internal or external), as well as the number of hires from each protected group, along with the number of jobs filled, which includes hires as well as non-competitive placements.

This is confusing, however, when the next OFCCP FAQ says that the number of applicants will be compared to the number of jobs filled, which may include non-competitive placements.

There is an FAQ that permits a contractor to apply the Internet Applicant Rule to remove applicants who are not considered or who do not meet the basic qualifications for the job. However, contractors should be certain that the basic qualifications used to screen out job-seekers are not doing so based on any criteria that would tend to screen out individuals with a disability or protected veterans.

Let’s walk through an example scenario outlining the disconnect between the regulatory guidance:

A contractor is filling an opening for a computer programmer. The job is first posted internally, and there are 10 internal candidates who express interest in this job. The job was also posted externally, and there were 50 external people who expressed interest in the job as well. However, because one of the internal candidates was selected, none of the external job-seekers were considered for the position.

How many applicants are there?

Not only is this guidance unclear across E.O. 11246, Section 503, and VEVRAA requirements, but the confusion is continued when we examine OFCCP enforcement trends related to this topic.   Compliance officers conducting compliance reviews under E.O. 11246 often do not consistently apply the standards outlined in UGESP and the Internet Applicant Rule when determining who to include in the personnel analysis for race/ethnicity and sex, and the revised scheduling letter and itemized listing do not provide any additional guidance or clarification.  It is not uncommon to encounter compliance reviews where compliance officers remove internal candidates completely from an applicant analysis, even if the internal candidate meets the standards found in UGESP or the Internet Applicant Rule.   Yet, all official guidance appears to conclude that competitive internal applicants should be included in all types of analyses that cover E.O. 11246, Section 503, and VEVRAA.

At DCI, we recommend using the Internet Applicant Rule in determining whether or not a job seeker qualifies as an applicant. However, contractors should make sure the disposition codes are properly used and clearly indicate why the individual did not meet basic qualifications or withdrew from consideration. Contractors should also evaluate the basic qualifications to determine if they are a barrier to individuals with disabilities or protected veterans. We will continue to provide updates as we learn more about the new regulations and how contractors should conduct the analyses required under Section 503 and VEVRAA as we learn more.

By Dave Sharrer, Consultant and Joanna Colosimo, Senior Consultant at DCI Consulting Group 

For more information on Section 503 or VEVRAA, please visit our archives.