Psychological Assessment in the Workplace: Legal Considerations.

Psychological assessment can greatly aid organizations with employee development and selection decisions. Pre-hire assessments can assist with creating a more objective selection process, improve match between candidates’ personalities and organizational needs, reduce ramp up time, and increase job satisfaction and retention. Assessment for leadership development can help to identify employees with high leadership potential and assess key personnel for strengths and developmental needs. For individuals in the upper level positions, assessment can provide data for further development through executive coaching.

The laws that have important implications for psychological assessment in the workplace include Title VII of the Civil Rights Act (CRA), Age Discrimination in Employment Act (ADEA), Title I of the Civil Rights Act, and Americans with Disabilities Act (ADA). These laws prohibit discrimination in employment based on race, religion, sex, sexual or gender orientation, national origin, age, or disability. It is important to note that under disability ADA includes mental illness.

The Equal Employment Opportunity Commission (EEOC) was established to enforce federal laws prohibiting employment discrimination. Along with three other agencies, the EEOC participated in the development of Uniform Guidelines on Employee Selection Procedures. Uniform Guidelines state that it is unlawful to use any test or selection process that creates “adverse impact“, which is said to occur when a substantially different rate of employment decisions work to the disadvantage of members of a protected group. On the other hand, Uniform Guidelines also address “business necessity”, an exclusion that allows Hooters, for example, to avoid having to hire male waiters.

A good test measures what it claims and does so consistently. Two statistical properties of a test, its reliability and validity are very important when making test selection. Properly developed tests should include a manual reporting validity and reliability evidence and the details on how the development and validation studies were conducted. Furthermore, the results of these studies should have been made available to the scrutiny of other professionals via publication in peer reviewed journals. Among other data that should be reported in the manual are the age, sex, and racial composition of the research sample used for the test development.

An assessment battery is a set of instruments selected for a specific assessment purpose (e.g. leadership development). Each instrument typically measures a number of specific individual characteristics (e.g. analytical reasoning). Psychological testing often relies on personality inventories which measure characteristics such as motivation, emotional intelligence, or self-discipline. These constructs should be job-relevant. Personality inventories that measure clinical constructs, such as depression or neuroticism, can be interpreted to violate the ADA.
This is the case even if the construct was not used to draw a conclusion, since it can be claimed to bias the assessor.

It is important to differentiate selection assessments from those performed for development purposes, as the concerns about adverse impact are eliminated when no selection, placement, or training decisions are being made. Furthermore, if the assessment is administered by a third party, the assessment results can be provided to the individual and not the organization, further eliminating the concern that the assessment data could be used for selection at some point in the future.

The professionals who provide individual psychological assessment in organizations must have the training necessary to properly evaluate assessment instruments for compliance with the above laws. To do so, they must possess an understanding of psychometrics, including theory of test development and statistics. They must also be knowledgeable about the specific tests used and be trained in administration procedures. Industrial and organizational psychologists who specialize in assessments should be sought out for the purposes of evaluating, administering, and analyzing the results of assessment measures. For more information on psychological assessment in the workplace, check out Testing and Assessment: an Employer’s Guide to Good Practices published by the US Department of Labor.