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September 25, 2012

Current Challenges To Pre-Hire Screening Procedures

Summary:

The Leprino Foods case highlights the advisability of businesses judiciously determining and documenting in advance the valid business justification for employment screening procedures such as pre-employment tests and background screening and taking other steps to position themselves to defend their procedures for credentialing workers against possible employment discrimination claims.

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The consent decree between the U.S. Department of Labor’s Office of Federal Contract Compliance Program and Leprino Foods Inc., resolving charges of systemic hiring discrimination at the company’s Lemoore West facility and signed recently by a Labor Department administrative law, highlights the growing aggressiveness of the Labor Department in challenging employment screening practices.

The Leprino Foods case highlights the advisability of businesses judiciously determining and documenting in advance the valid business justification for employment screening procedures such as pre-employment tests and background screening and taking other steps to position themselves to defend their procedures for credentialing workers against possible employment discrimination claims.

Denver-based and one of the largest producers of mozzarella cheese in the world Leprino Foods has received contracts totaling nearly $50 million from U.S. Department of Agriculture’s Farm Services Agency to provide mozzarella and other dairy products to the federal government since 2005.

The Leprino Foods consent decree settles OFCCP’s allegations that Leprino Foods’ use of a pre-employment test called WorkKeys to select hires for on-call laborer positions illegally discriminated against discrimination against African-American job applicants and applicants of Asian and Hispanic descent.

OFCCP charged Leprino Foods violated Executive Order 11246, which prohibits federal contractors and subcontractors from discriminating on the bases of race, color, religion, sex and national origin in their employment practices. The agency made its findings after a scheduled compliance review in which OFCCP investigators conducted interviews, analyzed company data and reviewed documents provided by the company. Through this review, OFCCP discovered that the administration of the WorkKeys exam had an adverse impact on minority job applicants for these specific positions. The agency also found that the exam was not job-related, as it tested applicants’ skills in mathematics, locating information and observation — skills that the OFCCP felt were not critical to the entry-level tasks performed by on-call laborers, such as inspecting products, monitoring equipment and maintaining sanitation at the facility.

Under the terms of the consent decree, Leprino will pay $550,000 in back wages, interest and benefits to 253 minority workers who were rejected for on-call laborer positions between January 2005 and October 2006 because they failed the WorkKeys exam. Additionally, the company has agreed to discontinue use of the test for this purpose, hire at least 13 of the original class members, undertake extensive self-monitoring measures and immediately correct any discriminatory practices.

The settlement reminds business leaders of the growing aggressiveness by the Obama Administration in challenging a broad range of pre-hire screening procedures such as pre-employment skills and other testing, background checks or the like. In the face of these enforcement activities, businesses desiring to use these or other screening procedures should take steps to position themselves to defend against likely challenges and scrutiny. As part of these efforts, businesses should exercise care to conduct and retain carefully conducted and well documented analysis of the legitimate business justification for their use of tests, background checks or other credentialing procedures. This analysis and documentation should be conducted prior to the implementation and use of these procedures to minimize the likelihood that the “after acquired evidence rule” or other similar arguments might be used to undermine the admissibility and effectiveness of these business justification arguments. Businesses also should implement procedures to monitor for potential evidence of adverse impact or other improper bias against candidates in protected employment classes by the tests themselves or in their administration and implement well-documented processes to control for such bias.

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