Out of Work? Out of Luck

EEOC Examines Employers’ Treatment of Unemployed Job Applicants at Hearing

WASHINGTON—In a public meeting held today, the U.S. Equal Employment Opportunity Commission (EEOC) examined the impact of employers considering only those currently employed for job vacancies.

“Throughout its 45 year history, the EEOC has identified and remedied discrimination in hiring and remains committed to ensuring job applicants are treated fairly,” said EEOC Chair Jacqueline A. Berrien. “Today’s meeting gave the Commission an important opportunity to learn about the emerging practice of excluding unemployed persons from applicant pools.”

According to Helen Norton, Associate Professor at the University of Colorado School of Law, 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. “Some employers may use current employment as a signal of quality job performance,” Norton testified. “But such a correlation is decidedly weak. A blanket reliance on current employment serves as a poor proxy for successful job performance.”

“The use of an individual’s current or recent unemployment status as a hiring selection device is a troubling development in the labor market,” said Fatima Goss Graves, Vice President for Education and Employment of the National Women’s Law Center. She noted that this practice “may well act as a negative counterweight” to government efforts to get people back to work. Women, particularly older women and those in non-traditional occupations, are disproportionately affected by this restriction, testified Goss Graves.

Denying jobs to the already-unemployed can also have a disproportionate effect on certain racial and ethnic minority community members, Algernon Austin, Director of the Program on Race, Ethnicity, and the Economy of the Economic Policy Institute, explained. Unemployment rates for African-Americans, Hispanics and Native Americans are higher than those of whites. When comparing college-educated workers, the unemployment rate for Asians is also higher. Thus, restricting applications to the currently employed could place a heavier burden on people of color, he concluded.

The use of employment status to screen job applicants could also seriously impact people with disabilities, according to Joyce Bender, an expert in the employment of people with disabilities. “Given my experience, I can say without a doubt that the practice of excluding persons who are currently unemployed from applicant pools is real and can have a negative impact on persons with disabilities,” Bender told the Commission.

Dr. William Spriggs, Assistant Secretary of Labor for Policy, offered data supporting this testimony. Spriggs presented current national employment statistics showing that African-Americans and Hispanics are overrepresented among the unemployed. He also stated that excluding the unemployed would be more likely to limit opportunities for older applicants as well as persons with disabilities.

“At a moment when we all should be doing whatever we can to open up job opportunities to the unemployed, it is profoundly disturbing that the trend of deliberately excluding the jobless from work opportunities is on the rise,” said Christine Owens, Executive Director of the National Employment Law Project. In addition to presenting statistical evidence, she recounted stories unemployed workers have shared with her organization where they were told directly that they would not be considered for employment due to being unemployed.

James Urban, a partner at the Jones Day law firm, who counsels employers, expressed doubt as to the extent of the problem. Fernan Cepero, representing the Society of Human Resource Professionals, told the Commission that his organization is not aware of this practice being in regular use. But both Mr. Urban and Mr. Cepero noted that the automatic exclusion of unemployed persons from consideration does not constitute “due diligence” in the screening of job applicants.