Too Good to Work Here? Considering Job Applicants Who Appear to be Overqualified

Transcription

1 Too Good to Work Here? Considering Job Applicants Who Appear to be Overqualified December 3, 2014 Jim Kuthy, Ph.D Heather Patchell M.A.

2 Overview of Biddle Consulting Group, Inc. Affirmative Action Plan (AAP) Consulting and Fulfillment HR Assessments Custom Test Development & Validation EEO Litigation Consulting /Expert Witness Services Compensation Analysis Publications/Books BCG Institute for Workforce Development Speaking and Training Thousands of AAPs developed each year Audit and compliance assistance AutoAAP Enterprise software AutoGOJA online job analysis system TVAP test validation & analysis program CritiCall pre-employment testing for 911 operators OPAC pre-employment testing for admin professionals Video Situational Assessments (General and Nursing) High stakes test development Validation studies in response/prevention to litigation Over 200+ cases in EEO/AA (both plaintiff and defense) Focus on disparate impact/validation cases Proactive and litigation/enforcement pay equity studies COMPare compensation analysis software EEO Insight : Leading EEO Compliance Journal Adverse Impact (3 rd ed.) / Compensation (1 st ed.) 4,000+ members Free webinars, EEO resources/tools Regular speakers on the national speaking circuit 2

3 Biddle Consulting Group Institute for Workforce Development (BCGi) BCGi Memberships (free): 6,000+ members / 13,000 HRCI credits to-date Online community Monthly webinars on EEO compliance topics EEO Insight Journal (e-copy) BCGi Platinum Membership (paid) Includes validation/compensation analysis books EEO Tools including those needed to conduct AI analyses EEO Insight Journal (e-copy and hardcopy) Access to the BCGi library of webinars, training materials, and much more 3

4 Flexible. Comprehensive. Affordable. Flexible: Outsourcing, online software, and/or combined approaches Web-based 24/7 Plan Access Switch between outsourcing/software instantly Instantly updateable to address an ever-changing regulatory climate Comprehensive: Every client (software and/or outsourcing) becomes a member of Biddle Consulting Group s Institute for Workforce Development (BCGi) and is paired with a seasoned myaapsolution Specialist... not just technical support - AAP development support. Affordable: Contact BCG today for some of the most aggressive rates available. 4

5 Too Good to Work Here? Considering Job Applicants Who Appear to be Overqualified December 3, 2014 Jim Kuthy, Ph.D Heather Patchell M.A.

6 A Little About the Presenters Jim Kuthy holds a Doctorate in Industrial & Organizational Psychology and taught Psychological Testing at California State University, Sacramento Heather Patchell has a Masters Degree in Psychology and is Executive Director of the BCGi Institute for Workforce Development More than twenty-five combined years of experience in the employment selection field They have designed and validated selection and promotion devices for many employers, including written multiple-choice tests Jim Kuthy, Ph.D. jkuthy@biddle.com Heather Patchell, M.A. hpatchell@biddle.com

7 Agenda Economic Issues (Why is it an issue now?) Issues for Employers (Why should I care?) Pros/Cons of hiring overqualified applicants Overqualified Defined and Examined Recommendations and Best Practices

8 Economic Issues: Why is this an Economic issue Issues now? Why is this an issue now?

9

10 Canada in 2000 About 27% to 48% of college bachelor's and doctoral graduates were overqualified for their main job About 48% to 72% of master s-level graduates were overqualified Statistics Canada: Centre for Education Statistics Frenette, M. (2000). Overqualified? Recent graduates and the needs of their employers, Education Quarterly Review, 7(1), 6-20.

11 Overqualified by Two or More Levels Bachelor s degrees: 19% to 29% Master s degrees: 8% to 17% Doctoral degrees: 9% to 21% Varied by study area: Graduates in health field generally had lower rates of overqualification

12 Newspapers & Magazines are Full of Overqualification Stories Employers flooded with applications from job seekers with degrees Geico Insurance, Virginia Zoo, Disneyland, Six Flags, Knott s Berry Farm, Busch Gardens Some workers with advanced degrees are offering to work at lower levels Attorneys applying for paralegal positions; highly-experienced accountants applying for entry-level positions

13

14 A 1999 study found four times as many firms unwilling to hire overqualified candidates than to hire them Study by: Bewley, Truman F. (1999). Why Wages Don t Fall During a Recession. Cambridge, MA: Harvard University Press.

15 As overqualified candidates take jobs that require less education/experience, they may be causing those with lesser education or experience to become overqualified for the jobs that are left for them to seek

16 Issues for Employers: Why should I care?

17 Possible Pros and Cons of Hiring Those Overqualified PROS Quick studies Can help others develop A hiring bargain Great promotional pool More productive CONS Too expensive Likely to intimidate others Unchallenged (bored) Higher turnover May complain about pay Counterproductive work behaviors Burnout Less productive

18 Gravitational Theory is Sometimes Cited as a Basis for Setting Upper and Lower Cutoffs This theory states that people select job opportunities based on their own assessment of their interests, knowledge, skills, and abilities This implies the average levels of intelligence, experience, etc. reflects the persons best suited for that position Interesting theory However, not an acceptable defense in court if there is a Civil Rights violation McCormick, Jeanneret, & Mecham (1972) McCormick, DeNisi, & Shaw (1979)

19 Overqualified: Defined and Examined

20 Overqualified How? Experience Intelligence Skill Training or education Note: If someone is overeducated, but not over skilled, the mismatch may be minimal

21 Nebraska Workforce Development Department of Labor

22 The applicant is too experienced...

23 Too Much Experience? One recent study that looked at self-reported measures of overqualification suggests that too much experience can be related to Less productivity Counterproductive work behaviors Burnout The study cautioned, however, that bored workers can be a result of ineffective managers, rather than incorrect hiring decisions Luksyte, A., & Spitzmueller, C. (Submitted for publication). Why do overqualified incumbents deviate? Examining multiple predictors. University of Houston.

24 Is Overexperienced a Code Word for Older? Some claim that failing to hire older workers who are overqualified in terms of experience is often an excuse to discriminate against workers based on their age.

25 What Do the Courts Say About Overqualified Older Workers? Taggart v. Time, Inc. (1983) Court of Appeals for Second Circuit (New York, Connecticut, Vermont) indicated that claims of overqualification might be a euphemism to mask age discrimination Stein v. National City Bank (1985) - Court of Appeals for Sixth Circuit (Kentucky, Michigan, Ohio, Tennessee) indicated that not hiring those with a college degree to potentially reduce turnover or because workers would become easily bored is acceptable EEOC v. Insurance Co. of North America (1988) Court of Appeals for Ninth Circuit (Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon, Washington) held that a refusal to hire a prospective employee based on an honest belief that he/she is overqualified does not by itself violate the Age Discrimination in Employment Act

26 One Court s Logic About an Overqualified Candidate and ADEA Although the ADEA does not prohibit rejection of overqualified job applicants per se, some courts have expressed concern that such a practice can function as a proxy for age discrimination if "overqualification" is not defined in terms of objective criteria. Court said in this instance overqualification did not serve as a pretext for age discrimination. Instead, the evidence showed that in this instance, and in the past when it filled this lower-level position, ICNA favored applicants with much less experience than Pugh, supporting ICNA's contention that it truly believed Pugh was overqualified for the position. Keep in mind that different courts have ruled differently EEOC v. Insurance Co. of North America (1988)

27 The applicant is too intelligent...

28 A typical relationship between test performance and job performance Test Score = 22 Performance = 31 Test Score = 85 Performance = 55

29 We then compute the best fit of the relationship between test scores and the criteria

30 Sometimes the relationships are curved, whereby the optimal level is somewhere in the middle

31 Too Intelligent? Jordan v. City of New London (2000) Police officer candidate was eliminated because he scored above the norm on the Wonderlic intelligence test Wonderlic User s Manual warned that hiring the highest-scoring person is not always the best choice However, no empirical evidence and very limited theory was offered in the manual to justify the use of an upper cutoff limit Trial judge stated, plaintiff may have been disqualified unwisely, but he was not denied equal protection. U.S. Court of Appeals for Second Circuit Plaintiff presented some evidence that high scores do not actually experience more job dissatisfaction, but that evidence does not create a factual basis, because it matters not whether the city s decision was correct so long as it was rational.

32 Important Facts to Consider This was not a Title VII Civil Rights case since applicant was not protected If it had been Question 37 of the Q&As for the Uniform Guidelines on Employment Selection Procedures states: Thus, the mere demonstration of a rational relationship between a selection procedure and the job does not meet the requirement of Title VII of the Civil Rights Act of 1964 In other words, if this had been a Title VII Civil Rights case, a greater level of evidence of the validity of the upper-limit cutoff score would have been required Lesson: It is a good idea to address the Uniform Guidelines whenever possible just in case a civil rights violation occurs

33 A 2003 Review of Claims of Too Much Intelligence Stated Assertion of high intelligence being a valid predictor of dissatisfaction is not supported in literature Adding upper-limit score cutoffs would not add to predictive value of tests Eliminating more intelligent people from the pool will reduce candidates for higher-level jobs and management Says that if upper-level score cutoffs were related to relevant job criteria in the future, their use might be justified Moustafa, K. S., & Miller, T. R. (2003). Too intelligent for the job? The validity of upper-limit cognitive ability test scores in selection. S.A.M. Advanced Management Journal, 68(2), 4-9,55.

34 Keep in Mind Look for a match between candidates and the job Intelligent people are more likely to discover complexity in their duties Some studies indicate intelligence is only weakly related to turnover (e.g., Cotton & Tuttle, 1986)

35 Too Much Education? Studies indicate most hiring managers have a clear, but flexible, idea about how much education is too much Floors tend to be more rigid than ceilings Managers are more willing to hire overeducated if the candidate possesses appropriate experience Careful: Some studies in the 1980s suggested sex differences in what employers considered over education This can lead to adverse impact against women

36 What Does Other Research Tell Us? Cognitive ability was not significantly related to call center retention Person-Organization Fit measure (compatibility of individuals with the organization in which they work) strongly related to retention and helped predict turnover beyond that of cognitive ability alone McCulloch & Turban, 2007 Overall job performance of over-educated workers not significantly different from adequately educated workers King & Hautalumoa, 1987 Authors found a weak negative correlation between perceived over qualification and self-rated job performance Bolin & Feldman, 2000

37 What Does Other Research Tell Us? New London Police Department asserted that overqualified workers are more likely to be bored, resulting in frustration, which causes them to quit Study by Wald (2005) suggested this somewhat justified not hiring overqualified candidates However, employee perceptions can play a role There likely will be less job-search activity if employee is satisfied with their work, feel their work is interesting, feel they are being treated fairly, and/or believe they have good opportunities for advancement Wald, S. (2005). The impact of overqualification on job search. International Journal of Manpower, 26(2),

38 How much is too much?

39 Uniform Guidelines for Employee Selection Procedures Section 5H. Cutoff scores: Where cutoff scores are used, they should normally be set so as to be reasonable and consistent with normal expectations of acceptable proficiency within the work force. Where applicants are ranked on the basis of properly validated selection procedures and those applicants scoring below a higher cutoff score than appropriate in light of such expectations have little or no chance of being selected for employment, the higher cutoff score may be appropriate, but the degree of adverse impact should be considered

40 A Word of Caution Most employers defend against potential litigation by claiming they hire the most qualified person for the job You cannot claim this if you eliminate job candidates who are overqualified Eliminating overqualified candidates would likely require a relatively high level of validity to defend Reducing experience or intelligence levels of current candidate pool may not be a good idea if promotions will be eventually filled from that pool

41 Recommendations and Best Practices

42 Recommendation We recommend against using overqualification as a deciding factor To do so would invite additional scrutiny when the evidence leans in both directions (i.e., overqualified individuals both help and hurt an organization) Ability to defend the use of an over qualification standard may change with the economy o o May be job-related and defensible in a poor economy May not be job-related and defensible in a strong economy

43 Potential Benefits of Hiring Those with Higher Experience, Education, or Intelligence Levels Train more quickly Often more productive Can mentor others More likely to move upward in organization More diverse groups are more creative

44 Recommendations for Minimizing Legal Exposure If you choose to not hire overqualified applicants we recommend the following: Explain job carefully to all candidates so they understand the job duties and context Offer a realistic job preview Gather information about the validity of your using an upper limit approach o Do not rely heavily on unverified claims or report from newspapers, magazines, or internet they are frequently incorrect or over-simplified Validate your selection processes to insure compliance with Uniform Guidelines

45 Recommendations for Minimizing Legal Exposure Discriminate only on a person s ability to do the job Use only practices, procedures, and/or tests that can be linked to important aspects of job performance Make sure you have the evidence to support claims of job-relatedness You do not have to hire unqualified applicants

46 Recommendations for Minimizing Legal Exposure There is nothing inherently wrong with basing employment decisions using subjective criteria However, there is an increased risk when using only subjective criteria when making employment decisions Employers should attempt to use objective criteria when evaluating whether applicant is overqualified If subjective criteria are used, employer should maintain a hiring policy that indicates the relationship between worker s traits and performance (i.e., validity) It is possible to statistically validate upper limits to test scores Also, if possible attempt to demonstrate legitimate factors, other than just experience, were considered

47 Recommendations for Increasing the Effectiveness of Overqualified Employees Emphasize the value of employees contributions Expand work roles/responsibilities to encompass broader skill sets Nominate overqualified subordinates to serve as mentors to co-workers or to conduct on-the-job training for newly hired people

48 Don t Wait to Validate! Enforcement agencies have had pretty good success investigating validity issues when adverse impact has occurred

49 U.S. Civil Rights Law You must validate a selection device if there is adverse impact against a protected group of candidates Adverse impact is a substantially different rate of selection in hiring, promotion, or other employment decision which works to the disadvantage of members of a race, sex, or ethnic group (or other protected status) Validation is demonstrating job-relatedness of a test as specified by the federal Uniform Guidelines on Employment Selection Procedures It is a good idea to validate even if there is no adverse impact The courts are more likely to scrutinize validity studies conducted after adverse impact is found

50 Helpful Validation Resources Federal Uniform Guidelines on Employee Selection Procedures (free resource) U. S. Department of Labor s Testing and Assessment: An Employer's Guide to Good Practices (free publication) Adverse Impact and Test Validation: A practitioner s guide to valid and defensible employment testing Authored by Dan Biddle; available from BCG

51 Some Articles Cited in this Presentation Fine, S., & Nevo, B. (2008). Too smart for their own good? A study of perceived cognitive overqualification in the workforce. The International Journal of Human Resource Management, 19(2), McCulloch, M. C. & Turban, D. B. (2007). Using Person-- Organization Fit to Select Employees for High-Turnover Jobs. International Journal of Selection and Assessment, 15(1), Wells, S. J. (2004). Too good to hire? HR Magazine, 49(10),

52 Q & A Copyright Biddle Consulting Group, Inc. 52