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Besides Bad PR, Currently Employed-Only Ads May Get You EEOC Attention

by Aug 9, 2011, 5:25 am ET

Is your company among those who reject the unemployed because they are unemployed?

If you are — and a report from the National Employment Law Project suggests the list is longer than you might think — be careful. You’re walking a thin line between legal discrimination, and the kind that just might result in a disparate impact complaint from the EEOC.

At the behest of some 50 members of Congress, the U.S. Equal Employment Opportunity Commission held a day-long hearing on the matter several months ago. No formal statement has come out of the hearing, but the attention focused on the issue by the EEOC and Congress is raising concern among the employment bar. Labor lawyers are counseling employers to act carefully, avoiding blanket policies against hiring the unemployed.

Unless you are hiring in New Jersey, it is legal to include language in a job posting discouraging the unemployed from applying. In the Garden State, however, it became illegal on June 1 to discriminate against the unemployed in print or online ads. But everywhere, it’s bad PR to include the kind of wording that turned up in the now-infamous Sony Ericsson job posting.

Legal or not, employment lawyers at Foley & Lardner warned a few months ago that “employers can expect their hiring practices concerning the unemployed to be scrutinized.”

With an unemployment rate (in June) of 16.2 percent, twice that of whites, blacks could well be disproportionately impacted by a blanket “no unemployed” policy. Thus, said the Foley & Lardner lawyers, “The issue also seems ripe for a disparate impact test case, perhaps even one brought by the EEOC itself against an employer.”

The labor specialist group at Weil, Gotshal & Manges concluded a detailed account of February’s EEOC hearing on unemployment discrimination with this:

Given the EEOC’s attention on blanket prohibitions against hiring unemployed applicants, employers run the risk of raising the EEOC’s interest when imposing these types of bans, which could culminate in a lawsuit brought by the EEOC or by individual job applicants denied employment because of such a prohibition. Even if the EEOC or a claimant would not ultimately prevail, given the cost and distraction associated with defending against such claims, it would be prudent for employers to investigate alternative ways of achieving their goals, if practical, rather than relying solely on employment status as means of evaluating job candidates.

Irrespective of the EEOC threat, there’s a groundswell of support to “do something” about the nation’s job situation and its 14 million unemployed and another 11.3 million underemployed and discouraged workers.

New Jersey’s law had the support of the state’s Republican governor, Chris Christie, who’s often mentioned as a possible presidential candidate. New Jersey neighbor, New York, and Michigan have taken up similar legislation.

At the federal level there are two bills dealing with the subject. The more moderate, introduced last month by Connecticut Democrat Rosa DeLauro, makes it unlawful to publish a job posting that contains discriminatory language. It also prohibits employers from refusing to consider or hire an individual simply because they are unemployed.

Enforcement is up to the aggrieved individual in a civil action or by the Department of Labor.

The second bill adds the unemployed as a protected class to Title VII. This would make the EEOC the enforcement arm, and subject employers to all the reporting and compliance requirements.

The likelihood of either federal bill passing is probably not high. But that doesn’t mean it’s impossible, particularly for the DeLauro bill. With elections coming up next year and unemployment showing no sign of abating, both the White House and Congress may grasp at anything that suggests help.

A poll commissioned by the National Employment Law Project found 90 percent of respondents agreeing that discriminating against the unemployed is unfair. Some 63 percent favor the kind of Congressional action embodied in the DeLauro bill.

The poll got widespread attention when The New York Times wrote about the issue of unemployment discrimination.

The article notes that “there are legitimate reasons that many long-term unemployed workers may not be desirable job candidates.” These range from using employment status as a screening tool, to concerns with atrophied skills, and recruiter concerns that workers laid off early in the recession may simply have not been good performers.

Last year, I referenced other reasons for excluding the unemployed, including the usual bias to hire passive candidates.

Popular sentiment, however, is that excluding the unemployed from consideration isn’t right. In a matter of a weekend, USAction collected over 25,000 signatures on a petition calling on job boards to refuse ads that include discriminatory language against the unemployed.

Three of the largest job boards — CareerBuilder, Dice, and Monster — say they discourage customers from including such language in job postings.

On the same day the Times’ story appeared, Monster used its blog for the second time this year to say, “We at Monster strongly oppose this practice and advise our clients on the risks of discriminating against any individual.”

Both CareerBuilder and Dice said they have policies against discriminatory language in job ads. Both monitor ads for compliance with relevant law, advising customers when one comes across and removing it if the client doesn’t.

Dice’s SVP, Tom Silver, pointed out that “Today, there are talented professionals who may happen to be unemployed largely due to circumstances beyond their control. Companies should seek the best talent that has the right capabilities and cultural fit. Limiting a company’s chance to find successful colleagues — only puts the employer at a disadvantage.”

Peter Weddle, executive director of the International Association of Employment Web Sites, the job board business group, said it “strongly opposes any form of discrimination in hiring, to include discrimination against those who are unemployed.”

While USAction did not contact the IAEWS before launching its petition, Weddle said the matter is really one for the government.

“Until a Federal law is passed,” he said in an email, “it’s unclear what if anything we should or should not be doing. In general, we don’t believe it is a job board’s responsibility or role to ensure employer compliance with employment law. That’s the federal government’s job.”

This article is provided for informational purposes only and is not intended to offer specific legal advice. You should consult your legal counsel regarding any threatened or pending litigation.

  • Eric Mata

    I can relate to this issue because I went through it as a recruiter when I was laid off and was out of work for almost a year. I never came across an ad that said if you were unemployed do not apply but going through interviews I would get the feeling that because I was laid off there must be something wrong with me. Now that I am gainfully employed I do what I can to consider the unemployed for positions I have mainly because they can start working right away and don’t need a two weeks notice.

  • http://www.carcogroup.com Doreen Koronios

    Hi John, Thanks for the informative post. We all knew it was only a matter of time before the issue of deliberately not hiring the unemployed would be addressed on a national level (and rightfully so). Here’s some information on the new bill that was introduced, which we received from our legal counsel, and a link to the bill for those who would like to review it. On July 12th, Rep. Rosa DeLauro (D-CT) introduced a bill (H.R. 2501) that would prohibit employers and recruiters from refusing to consider either previously or currently unemployed individuals for an open position. DeLauro stated, β€œIn a tough job market, where workers are competing against tens and sometimes hundreds of others for every available job opening, it is unjust for employers to discriminate against those who are unemployed.”
    (http://www.gpo.gov/fdsys/pkg/BILLS-112hr2501ih/pdf/BILLS-112hr2501ih.pdf)

  • Darryl Clements

    Hiring only currently employed candidates is one of the laziest short-sighted actions and a company can take. Let’s not overlook that a lot of CEOs, C-suite executives, and high-leveled people are “unemployed” when they get hired by another company. No company’s Board of Directors would ever say “only hire a current CEO.”

    Seriously, any company who comes under fire for doing this probably deserves it. If the EEOC peeks under the covers, they’re going to find a lot more ugly stuff because there probably have been a myriad of other illegal, unethical, and very shady practices taking place that don’t get the same level of publicity.

    Actions like this define the very reason the EEOC is still relevant.

    Good luck defending against claims that someone else “more qualified and employed” was hired when the unemployed but perhaps even more qualified because of experience (some may even have trained or managed the currently employed).

    This is also a time when the HR leadership should be helping businesses make better decisions and take better actions. It’s an incredible stretch to overlook that some are still employed due to seniority or length of service over competency. It’s equally incredible that some don’t understand that unemployed when jobs were aplenty is not today’s reality where anyone can find themselves unemployed completely due to sudden, unforeseen business factors.

    Think there won’t be more people “unemployed” after the recent downturns in the market? Guess no one will be hiring those people?

    Just like smart investors always look for the best values and growth potential, so should companies when looking for employees regardless of where they do or don’t work.

  • Michaela Chapman

    The majority of people I know who have recently secured new positions were already employed. It is a huge issue now that I don’t see going away any time soon. My sibling, who is unemployed after a company layoff 2 years ago and is no longer getting unemployment benefits has been keeping up with her skills by taking classes and volunteering at organizations that allow her to continually use her skills in hopes that her CV will reflect that she is not lazy and ready to be employed. When she sees job postings that say the unemployed should not apply, she feels let down and punished for a situation that was out of her control.

    If enough people complain to the EEOC about this practice, especially since it is so widespread, they will consider taking action. Remember, employers didn’t think doing a credit check of applicants was discrimination and that turned around and bit them in the bum when the EEOC stepped in.

  • John Yates

    It’s certainly encouraging to see an agency such as the EEOC not only acknowledging this but we need more … the Department of Labor should be equally all over this as well as the States … where are the State agencies tasked with dicrimination ?

    We, as the people responsible for voting for the legislators ultimately responsible for laws to address this have to start electing people capable of walking, chewing gum … and … dealing with this directly and swiftly, not two years later after the damage has been done.

  • Sylvia Dahlby

    Darryl knocks it out of the park with his statement that “Hiring only currently employed candidates is one of the laziest short-sighted actions and a company can take.” Unfortunately it took a massive economic melt-down for many to realize this has ALWAYS been true.

    I applaud CareerBuilder, Dice, and Monster for discouraging advertisers from including such language in job postings. And I’m grateful to the ERE community recruiters who are realizing that in this economy, it’s NOT helping the weak economy by discriminating against unemployed or under-employed job seekers. There’s been a lot of discussions on the issue in this forum and others – and I’m glad everyone is finally waking up to smell the cat food.

    However, I am disturbed that this has given the EEOC yet another protected class and encouraged blood-sucking labor lawyers to file suit against companies that are hiring (great, let’s sue some real job creators right out of business so they have to lay off everyone else on their payroll).

    Why is it that we now need – or insist – government intervention for corporations to do the right thing? Where is the personal responsibility of hiring managers and corporate leadership? Those that decry big government are looking for fixes in the wrong places – its starts with YOU and me and each one of us needs to step up and insist on fair hiring practices in our own organizations.

  • Darryl Clements

    Sylvia – I’d be willing to bet these actions aren’t driven by non-HR business leaders. Even if they are, they ought to be caught by HR professionals. Perhaps I can give a little leeway and understanding to small companies who do this and don’t even realize they’re wrong, but I doubt thats who’s posting on major job boards.

    If HR professionals are letting this happen or in fact doing this knowingly, the flood of actions and trouble for the company won’t leave anywhere else to point the finger.

    I don’t think the job boards themselves have any responsibility for a company’s actions.

    What’s even more amazing – some of these postings are still up without revision!

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