The most important resources in any business are the people that make it happen. Managing those people—whether they are executives, staff, specialists, production personnel, or custodians—is a crucial part of making a business successful. Your business cannot exist without them, and it cannot effectively produce returns without their support. This blog post is the first in a short series about effective human resource strategies. Today, we will focus on hiring and recruiting. There are a myriad of issues associated with hiring. While we cannot cover all of them here, we will address key basics that you should be familiar with.
Equal Employment Opportunity Laws
First, you need to be aware of equal opportunity laws and bona fide occupational qualifications. The Equal Employment Opportunity Commission uses a four-fifths rule that applies to job candidates in strict scrutiny categories (race, gender, age, disabled vs. not, etc.). This rule works through a simple math equation: you find the percentage of applicants that belong to each group, and then you make certain that the smallest percentage is at least 80% of the largest percentage. For example, in an applicant pool of 100 applicants where 70 are from the largest group and 15 are from the smallest, you divide those 15 applicants by 70 and make certain it is above 80% (which it is not—15/70=21%). If it is not above 80%, you are at risk for a discrimination lawsuit.
The four-fifths ideal can be hard to achieve, so you need to cover your bases in hiring decisions. The key is found in bona fide occupational qualifications, or BFOQ’s. These are absolute requirements specific to a given job description, such as the ability to lift 50+ pounds at a construction site. If you log the reason each applicant is rejected with a BFOQ, you are better able to handle a legal challenge. However, if your job description includes BFOQ’s that routinely exclude a certain group, your BFOQ’s can be challenged for appropriateness. (For example, the Supreme Court rejected an argument that females presented a better marketing image for airlines than males.) If you are brought to court on a discrimination charge for a strict scrutiny class, the burden of proof is on you—meaning you are guilty until proven innocent. Do not underestimate the importance of examining your processes and keeping thorough records.
The Hiring Process
Second, we must address the hiring process itself. Hiring processes often involve a mixture of internal and external recruiting for open positions. A tried-and-true approach is to hire internally for top positions and then fill in the vacancies with external positions. This approach has the advantage of ensuring that all top employees have years of experience with the company. However, this can also be a disadvantage. It might perpetuate—or even cause—equal opportunity issues (especially with regard to age). Also, there are some intellectual advantages to bringing in new expertise from outside the company. On the other side, there can be some advantages to hiring internally for entry-level positions. Perhaps you would like to give your employees some cross training to increase their job satisfaction and better prepare them for advancement.
Finding Candidates
How you post your job positions is equally important to consider. If you use craigslist or other “want” ads, you can expect a large number of “fluff” applicants that are either not qualified or not really serious about applying. On the other hand, you can run into equal opportunity issues if you exclusively use “elite” posting services. You don’t want to be swamped with applicants (especially unqualified ones), but you don’t want all your applicants to be from the same strict scrutiny class, either. If you don’t use a general posting service (which seasoned professionals tend to ignore), then you need to use a mix of posting services, from field-specific union or guild sites to college recruiting networks to affirmative action listings. Such an approach will bring in an array of qualified applicants without leaving out a protected class.
Selecting the Right Person for the Job
Now you must plan your interviews. There has been a lot of talk about inappropriate questions lately, so we won’t address that here. Instead we will talk about what you should do. You should plan your questions according to the job description, asking questions that deal directly with important aspects of the job (such as teamwork or analysis skills). It is helpful to ask all your candidates the same questions in order to compare their answers more objectively. If you try to improve your questions on the spot, you risk confirmation bias, where you simply ask questions that tend to confirm your preconceptions. Also, questions about BFOQ’s in protected classes tend to land on shady ground unless you plan them in advance and carefully tie them to the job description.
Finally, let’s talk briefly about selection tests. These are somewhat underused hiring tools that can effectively identify the best applicants from large pools. If you have 300 applicants for a position (not uncommon in today’s economy) and you want to find the best ones, you can identify 100 of them to send a selection test to. These tests can include personality surveys, work sample requests, logic puzzles, and other tasks to help you assess the candidate’s fit for your organization. Such tests can be electronically administered and graded (at least to some degree) to reduce the burden on the screener. Then, you select interviewees from the best performers on the selection test.
The importance of having the right people in your organization cannot be understated, which is why we have addressed it exclusively in this post. Please check back next week for a post on performance appraisal and discipline. We will address how to make certain your employees continue to be the assets you hired them to be.
