Jobseeking

“Death by HR” Released as Audiobook

Death by HR Audiobook Cover

“Death by HR” Audiobook Cover

After much work with narrator Joe Farinacci (who did such a good job with Avoidant) the Amazon/Audible audiobook of Death by HR is finally for sale at these links:

Amazon
Audible

Death by HR: Progressive Dirigisme Takes Over the US

Unhappy college grad working at Starbucks

Unhappy college grad working at Starbucks

Labor lawyers and labor economists have historically been supported by labor unions and their cooperating Democratic legislators, who fund labor-leaning academic institutions. As a result, HR degree programs and faculty begin with a bias toward the labor laws and union-style thinking of academics in the field.

Social scientists generally lean left. Industrial Relations (IR), the field of labor-management studies, also leans sharply left.[1] Social science professors are overwhelmingly Democrats.[2] And the faculty in most HR degree programs are similarly biased, which means the typical new graduate from these programs has been indoctrinated to accept the necessity and essential fairness of the labor laws and regulations they will be expected to help enforce in their postings in private industry or government agencies. While we have seen that these new graduates tend to be tempered by exposure to real workplace life and management influence, they retain their political affiliations and continue to lean toward progressive causes and regulations.

Verdant Labs’ survey of political affiliation by occupation based on FEC campaign contribution reports doesn’t separate out HR staffers, but does cover HR execs and similar functions:

HR Executives 66% D, 34% R
Compliance Officers 72% D, 28% R
Administrative Manager 70% D, 30% R[3]

It’s easy to see why people whose careers involve administering government rules would tend to support the party that maintains that even more regulations are useful and necessary, because no one would want to work at something useless or even counterproductive. People who want to work long hours and enjoy the freedom to run risky but successful enterprises aren’t likely to be found in HR degree programs. This political tendency is valuable in cooperating with government overseers, but can cause HR staff to overlook the need for the organization they work for to improve productivity and compete with overseas firms not so hampered.

What is the leftist tendency? It is the view that people’s economic decisions are to be supervised and regulated by the state for the common good. Communists and Socialists took the simplistic extreme form, taking direct ownership of the means of production—factories, farms, and businesses — to be managed by the workers collectively or the larger state. Every country that tried this failed eventually because it turns out self-interested management by owners is vastly more productive, and no collective can decide as well as an owner with direct access to local and market information.

The leftist fallback position — after millions of deaths and multiple failures of true Communist and Socialist states — has been to leave property and the means of production in private hands, but thoroughly regulate and control what the owners may do with it. This leaves at least some incentive for owners to produce and invest in production facilities, but puts many important investment and employment decisions in the hands of a political body — a legislature, or agencies given power to oversee employers. And while some socially-harmful decisions (like pollution of the common air and water, discrimination against black people in employment and accommodation, and tolerance of dangerous working conditions in mines and factories) are thereby prevented, many other decisions are made poorly by collective bodies with little or no knowledge of local conditions. The freedom of both worker and employer to balance their interests and negotiate the most favorable contract is often limited by rigid labor regulations, as when workers who would like to work more hours to make extra money are not allowed to do so.

Union labor views were an offshoot of the socialist ideal, where the management of a business — the employer — is viewed as the enemy of the workers, constantly trying to cheat and enslave them. Enlightened managers, of course, have a much broader interest in the health and welfare of employees, and know that respect for their needs and independence makes for a happier, more productive, and loyal workforce ideal for long-term competitive advantage. But the cartoonish 1930s views of oppressive, wealthy capitalists still live on in many minds.

The labor laws dating from the progressive New Deal era embody the dirigisme (French for top-down direction of the economy) of that era, and are still with us, though many reforms have taken place. The US is now a patchwork of different labor regimes in different industries, as some unionized manufacturing has become less so, while public employee unions have grown in strength and power. Meanwhile, “right to work” laws in some states limited private sector union power and encouraged more foreign investment like the auto plants now dotting the South.

To see the negative results of heavy regulation of labor, one only has to look at parts of Europe that went all-out to protect and micromanage employment by heavily regulating hiring and firing. As an example, look at France — a highly-developed mature economy with heavy regulation of labor and so much legal job protection that employers are reluctant to hire any long-term employees for fear they can never be let go. Youth unemployment hovers around 25%, and the economy has been stagnant for decades. The BBC reports:

France has a lot going for it. It has “an enviable standard of living”, according to the Organisation for Economic Co-operation and Development (OECD). “Inequality is not excessive and the country has come through the [financial] crisis without suffering too heavily,” it says….

But all is not well. Unemployment is high and the government’s finances are weak. “France’s fundamental economic problem,” the OECD says, “is a lack of growth.” The latest figures for economic activity (gross domestic product or GDP) for the first quarter of the year show growth of 0.5%. That’s better than was expected though it’s probably best described as reasonable rather than strong. The longer term picture is more downbeat.

So what is the French economic problem? The most obvious social and economic evidence that something is amiss is unemployment. About three million people are unemployed—10.2% of the workforce. That compares with a figure of 4.3% across the border in Germany. The rate in France is almost the same as the average for the eurozone. That really is nothing to be proud of when you consider that the average reflects some jobless nightmare stories such as Spain and Greece. The French figure is also the second highest among the G7 leading developed economies. Youth unemployment is a particular problem, as it is in a number of other European countries. Almost one in four of those under 25 who want a job don’t have one.

The government’s finances are also in indifferent shape. France is also in the throes of an EU procedure that tries to impose discipline on governments’ finances. The annual budget deficit and the accumulated government debt are both higher than they are supposed to be under the rules…. Behind the problems lies persistently weak economic growth. Gross domestic product per person—a rough and ready indicator of average living standards—grew more slowly between 1995 and 2007 than in any other OECD country (mainly the rich nations) except Italy [which also overregulates labor.]

By the end of last year, economic activity was only 2.8% up from its peak level at the onset of the financial crisis. Why then is France struggling? Many younger people get work on a short-term basis only…. The view of many, including the OECD and the European Commission, is that the labour market is at the heart of the problem, though it’s not the only factor. That reflects a persistent complaint from business: that it’s too expensive to hire workers and to fire them or lay them off if they need to. France is a prime example of what is known as a “dual labour market”: insiders have higher pay, job security and often promotion prospects, [while] others, especially younger people, get only short-term work or none.

The OECD says in its assessment of the French economy: “To reduce the duality of the labour market, the procedures for laying off employees, particularly those on permanent contracts, need to be simplified and shortened…. France ranks among the countries with the strictest legislation of dismissal for open-ended and temporary contracts.” The cost of labour to employers in France also includes social security contributions that are higher than in most other countries. There is a catalogue of other issues, including welfare, that is alleged to discourage people taking low-paid work, and extensive regulation of business. The result, it is argued, is a persistent unemployment problem….

President Hollande has accepted the case for labour reform, and his Labour Minister, Myriam El Khomri, has introduced legislation intended to address some of the things that business voices say make it too expensive to take on new workers. The reforms would: lower existing high barriers to laying off staff; allow some employees to work more—far more—than the current working week, which is capped at 35 hours; give firms greater powers to cut working hours and reduce pay. That has met protest and the provisions have been amended in response. One supporter of reform said it was turning into a “veritable catastrophe”.[4]

Compared to France, the US has a free and dynamic labor economy,[5] but the signs of the Eurodisease are starting to show — an inflexible labor market with few professional openings for young people. The common joke about children returning to live in their parent’s basements is becoming a way of life for many. Increasingly, new college graduates are forced to take low-paying, unskilled jobs in service industries when they find work at all:

Recent college graduates are ending up in more low-wage and part-time positions as it’s become harder to find education-level appropriate jobs, according to a January study by the Federal Reserve Bank of New York.

Jeanina Jenkins, a 20-year-old high-school graduate from St. Louis, is stuck in a $7.82-an-hour part-time job at McDonald’s Corp. that she calls a “last resort” because nobody would offer her anything better.

Stephen O’Malley, 26, a West Virginia University graduate, wants to put his history degree to use teaching high school. What he’s found instead is a bartender’s job in his home town of Manasquan, New Jersey.

Jenkins and O’Malley are at opposite ends of a dynamic that is pushing those with college degrees down into competition with high-school graduates for low-wage jobs that don’t require college. As this competition has intensified during and after the recession, it’s meant relatively higher unemployment, declining labor market participation and lower wages for those with less education….

“The underemployment of college graduates affects lesser educated parts of the labor force,” said economist Richard Vedder, director of the Center for College Affordability and Productivity, a not-for-profit research organization in Washington.“Those with high-school diplomas that normally would have no problem getting jobs as bartenders or taxi drivers are sometimes kept from getting the jobs by people with college diplomas,” said Vedder…

The share of Americans ages 22 to 27 with at least a bachelor’s degree in jobs that don’t require that level of education was 44 percent in 2012, up from 34 percent in 2001, the study found. The recent rise in underemployment for college graduates represents a return to the levels of the early 1990s, according to the New York Fed study. The rate rose to 46 percent during the 1990-1991 recession, then declined during the economic expansion that followed as employers hired new graduates to keep pace with technological advances….

“College graduates might not be in a job that requires a college degree, but they’re more likely to have a job,” she said. Less-educated young adults are then more likely to drop out of the labor market. The labor participation rate for those ages 25 to 34 with just a high-school diploma fell four percentage points to 77.7 percent in 2013 from 2007. For those with a college degree and above, the rate dropped less than 1 percentage point, to 87.7 percent.

“At the complete bottom, we see people picking up the worst types of jobs or completely dropping out,” Beaudry said. The share of young adults 20 to 24 years old neither in school nor working climbed to 19.4 percent in 2010 from 17.2 percent in 2006. For those ages 25 to 29, it rose to 21.3 percent from 20 percent in that period, according to a Federal Reserve Bank of Boston report in December.

Those with the least education have trouble securing even the lowest-paid jobs. Isabelle Samain looked for work in Washington from April until September of last year. As prospective employers continually passed over her applications, the 40-year-old mother of two from Cameroon realized she was missing out because she lacked a U.S. high-school diploma. “I don’t even remember how many places I applied,” Samain said of the “frustrating and discouraging” search. Samain passed the General Educational Development test in December and recently started working at Au Bon Pain in Washington for $8.50 an hour for 36 hours a week.

A year-long survey ending in July 2012 of 500,000 Americans ages 19 to 29 showed that 63 percent of those fully employed had a bachelor’s degree, and their most common jobs were merchandise displayers, clothing-store and cellular phone sales representatives, according to Seattle-based PayScale Inc., which provides compensation information….

The share of recent college graduates in “good non-college jobs,” those with higher wage-growth potential, such as dental hygienists, has declined since 2000, according to the New York Fed study. Meanwhile, the portion has grown for those in low-wage jobs paying an average wage of below $25,000, including food servers and bartenders.[6]

The Party of Government perpetually campaigns on “doing something” about the problems of the little people. Meanwhile, the agencies of the administrative state, like all bureaucracies, keep busy and justify their growth by proposing additional and extended regulations. When regulations address a real problem—some externality requiring private parties to be restrained from damaging a common good or harming each other through force or fraud—there is an optimal point where the additional costs of more regulation are greater than the likely benefit. In labor regulation, the pols and regulators rarely consider the collateral damage they are doing by narrowing the freedom of contract—labor laws are always behind the curve of technology and custom, impeding creative solutions that both employer and employee would benefit from.

This “it’s always good to do more” mindset results in laws that are simply propaganda exercises, like the Lily Ledbetter Fair Pay Act of 2009, which extended the statute of limitations for equal pay suits to make it a bit easier to file suit against ongoing patterns of pay discrimination against women.[7] Unequal pay for women was actually outlawed in 1963 by the Equal Pay Act, but Democratic politicians in pursuit of women’s votes continue to promote the “pay gap” myth and then offer to “do something” about this imaginary unfairness. Each time they pass a new law or regulation, one might expect improvement in the unfair situation they claim to be addressing, yet the problem remains for the next election, when they will promise to fix it again.

The latest example of harming many by ratcheting up the regulations is the Obama administration’s enlargement of the number of employees covered by the Dept. of Labor’s overtime regulations under the Fair Labor Standards Act (FLSA), increasing the salary limit for exemption from $23,660 to $47,476 per year, which vastly increases the number of workers covered. At first glance, this sounds good for those employees — time-and-a-half for overtime, baby! But that ignores the likely response of managements to the new rules:

If an employer could pay Jim, a frontline manager at a retail store, for a 50-hour workweek—40 hours at his regular hourly rate and 10 hours at time-and-a-half—or, instead, pay Jim and Jane 25 hours each at straight rates, what would the employer do?

Unless the business is a philanthropy, or unless Jim exhibits pure brilliance in directing rank-and-file employees to stock shelves, the employer is going to choose lower labor costs over higher ones.

This is precisely the question raised by, and the likely effect caused by, new overtime rules under the Fair Labor Standards Act (“FLSA”). Given the basic economics of the workplace, the new rule—which raises the salary threshold under which an employee is entitled to overtime—is just as likely to create less work for individual employees as it is to increase the amount of overtime American employees collectively earn.[8]

The required estimate of costs of the new regulation was lowballed, pulled out of thin air by the DoL under orders from the union-friendly administration to further cripple nonunion businesses by increasing their costs. Independent calculations of the cost were more realistic:

How reliable are projections from the Department of Labor about the cost of the President’s ambitious new extension of overtime entitlements to salaried workers ….? The “administration refuses to allow others to check its math. The Florida Department of Economic Opportunity, the state agency that I lead, in August requested the specific data and methodology the Labor Department used to calculate its estimates. Our request was denied.” So the department went ahead with its own analysis. “The rule will supposedly cost $2 billion the first year. Our math shows $1.7 billion for Florida alone.”[9]

Even House Democrats found the new rules damaging:

It’s not clear whether the Obama administration’s forthcoming edict on overtime will apply to legislative staffers, but House Democratic leadership decided it would be prudent for their members to at least gesture toward the spirit of the controversial rule by preparing for compliance. Now “the rule is creating administrative headaches” and more:

“We don’t have a set-hour kind of situation here; some kids work 12, 14, 16 hours a day, weekends, and I feel terrible that I cannot afford to give raises to the staff,” Rep. Alcee Hastings (D-Fla.) told Bloomberg BNA Feb. 11.

With $320,000 slashed from members’ representational allowances (MRAs) over the past four years, “I don’t see how we could pay overtime” for the “17 or 18 people that each of us is allowed to have—that’s problematic for me,” added Hastings, a senior member of the House Rules Committee.

Some members fear that an overtime mandate will result in having to send staffers home at 5 p.m., leaving phones unanswered and impairing constituent service. “Most members are of the sentiment that it’s impractical to be paying overtime,” said former Virginia Democratic Rep. Jim Moran, now a lobbyist, who suggests that members choose to close one of their district offices or reduce constituent correspondence to adjust to a smaller staff number.

If only there were some way for the U.S. Congress to influence federal labor law![10]


[1] “The data suggests that the ratio of Democratic-to-Republican voter registration among participants in IR is roughly 10 to one. I find a similar ratio when looking at those who have made contributions to Democratic and Republican candidates for office. I also show that Democratic lopsidedness at the three mainstream IR journals becomes more extreme at the higher stations (officers and editors, as opposed to ordinary members and authors). Also, I analyze the content of the 539 articles for union support and regulation support; the mainstream IR journals are overwhelmingly pro-union and pro-regulation.” From article “The Left Orientation of Industrial Relations,” by Mitchell Langbert, Econ Journal Watch, Vol 13, No. 1, Jan. 2016. https://econjwatch.org/articles/the-left-orientation-of-industrial-relations
[2] “Daniel Klein, one of the authors [of the study] and a professor of economics at George Mason University, said that it demonstrated ‘solidly’ that most social science professors are ‘leftist and statist, and that they have a narrow tent.’” From “Social Scientists Lean to the Left, Study Says,” by Scott Jaschik, Inside Higher Ed, Dec. 21, 2005. https://www.insidehighered.com/news/2005/12/21/politics. Also see: “Economists’ policy views and voting,” Daniel B. Klein and Charlotta Stern, Public Choice 126:331-342, 6 Dec 2004. http://econfaculty.gmu.edu/klein/PdfPapers/KS_PublCh06.pdf
[3] “Democratic vs. Republican occupations,” Verdant Labs chart, 2016. Data source: FEC campaign contribution data. http://verdantlabs.com/politics_of_professions/
[4] “What is the French economic problem?” by Andrew Walker, BBC World Service, 29 April 2016. http://www.bbc.com/news/business-36152571
[5] French leftists sniff at the US and its Anglospheric cousins because the US economic model (the “Anglo-Saxon model”) is more liberal—less protectionist and dirigiste. The cultural backdrop is the French intellectual distaste for crude money-making and égoïste neglect of collective opinion. See https://en.wikipedia.org/wiki/Anglo-Saxon_model
[6] “Low-Wage Jobs Displace Less Educated,” by Katherine Peralta, Bloomberg, March 12, 2014. http://www.bloomberg.com/news/articles/2014-03-06/college-grads-taking-low-wage-jobs-displace-less-educated
[7] https://en.wikipedia.org/wiki/Lilly_Ledbetter_Fair_Pay_Act_of_2009
[8] “Deep Impact: New Overtime Rules Will Change Work, Not Overtime Pay,” by Mark A. Konkel and Barbara Hoey, Inside Counsel, August 31, 2016. http://www.insidecounsel.com/2016/08/31/deep-impact-new-overtime-rules-will-change-work-no
[9] “Lowballing the cost of junior-manager overtime,” by Walter Olson, Overlawyered, November 19, 2015. http://www.overlawyered.com/2015/11/lowballing-the-cost-of-junior-manager-overtime/
[10] “Overtime Brings House Democrats Woe,” by Walter Olson, Cato at Liberty, April 13, 2016. http://www.cato.org/blog/overtime-brings-house-democrats-woe


Death by HR: How Affirmative Action Cripples OrganizationsDeath by HR: How Affirmative Action Cripples Organizations

[From Death by HR: How Affirmative Action Cripples Organizations,  available now in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. 

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat… It is time to turn the tide against this madness, and Death by HR is an important research tool… All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.

 


More reading on other topics:

Jane Jacobs’ Monstrous Hybrids: Guardians vs Commerce
The Great Progressive Stagnation vs. Dynamism
Death by HR: How Affirmative Action is Crippling America
Death by HR: The End of Merit in Civil Service
Corrupt Feedback Loops: Public Employee Unions
Death by HR: History and Practice of Affirmative Action and the EEOC
Civil Service: Woodrow Wilson’s Progressive Dream
Bootleggers and Baptists
Corrupt Feedback Loops: Justice Dept. Extortion
Corrupt Feedback Loops, Goldman Sachs: More Justice Dept. Extortion
Death by HR: The Birth and Evolution of the HR Department
Death by HR: The Simple Model of Project Labor
Levellers and Redistributionists: The Feudal Underpinnings of Socialism
Sons of Liberty vs. National Front
Trump World: Looking Backward
Minimum Wage: The Parable of the Ladder
Selective Outrage
Culture Wars: Co-Existence Through Limited Government
Social Justice Warriors, Jihadists, and Neo-Nazis: Constructed Identities
Tuitions Inflated, Product Degraded, Student Debts Unsustainable
The Morality of Glamour

On Affirmative Action and Social Policy:

Affirmative Action: Chinese, Indian-Origin Citizens in Malaysia Oppressed
Affirmative Action: Caste Reservation in India
Diversity Hires: Pressure on High Tech<a
Title IX Totalitarianism is Gender-Neutral
Public Schools in Poor Districts: For Control Not Education
Real-Life “Hunger Games”: Soft Oppression Destroys the Poor
The Social Decay of Black Neighborhoods (And Yours!)
Child Welfare Ideas: Every Child Gets a Government Guardian!
“Income Inequality” Propaganda is Just Disguised Materialism

The greatest hits from SubstrateWars.com (Science Fiction topics):

Fear is the Mindkiller
Mirror Neurons and Irene Gallo
YA Dystopias vs Heinlein et al: Social Justice Warriors Strike Again
Selective Outrage
Sons of Liberty vs. National Front
“Tomorrowland”: Tragic Misfire
The Death of “Wired”: Hugo Awards Edition
Hugos, Sad Puppies 3, and Direct Knowledge
Selective Outrage and Angry Tribes
Men of Honor vs Victim Culture
SFF, Hugos, Curating the Best
“Why Aren’t There More Women Futurists?”
Science Fiction Fandom and SJW warfare

More reading on the military:

US Military: From No Standing Armies to Permanent Global Power
US Military: The Desegration Experience
The VA Scandals: Death by Bureaucracy

Death by HR: Affirmative Action and Hiring

Death by HR

Death by HR

Affirmative Action and Hiring

We reviewed Affirmative Action (AA) in the US and elsewhere and its negative effects, both on those who were intended to benefit from it and on the organizations that have implemented it. As time has passed, the original AA programs — meant to give a temporary boost to the prospects of black people damaged by slavery and a century of Jim Crow and racial discrimination — have broadened to include other protected classes like Latinos and women, and narrowed to exclude most Asians and other minorities that have succeeded without assistance despite past discrimination. AA programs in college admissions have been legally attacked and reformed in some places, but AA continues to influence hiring in many workplaces, especially in those subject to intensive government regulation like banks, schools, and hospitals. By continuing to put diversity goals above competence and efficiency, organizations have damaged their effectiveness and decreased accountability — protected classes are less likely to be disciplined or fired, and as a result every employee senses that merit is less important and the best are rewarded less while the worst performers are retained and promoted if required to meet diversity goals.

As a result, the least-efficient sectors of the economy are either government-funded or regulated. But corporations have copied the Civil Service-style job categories and hiring mechanisms, especially those larger corporations which have adopted the Federal government’s General Schedule (GS)-style level system specifying job responsibilities and pay levels. Workers below top management are hired under the organization’s general contract provisions as written in both labor law and specific policies documented in company handbooks, while higher executives may have specially-tailored contracts with provisions like golden parachutes (contract-cancellation bonuses), noncompete agreements, and custom deferred-compensation and stock option plans. We won’t look at executive hiring, which is rarely influenced by HR screening and qualifications.

Until recently, private employers were relatively safe in choosing objective criteria for judging job applicants so long as no protected class members were being discriminated against — judged improperly based on skin color, national origin, sex, religion, or other irrelevant factors. That changed in the government sector when courts began to outlaw examinations and other requirements that they said had a disparate impact on protected classes — in other words, if the supposedly objective criteria did not pass the same percentage of protected classes as other applicants, it was deemed improper even if evidence pointed to its validity as a measure of future job performance. Most private industries ignored this and continued to hire on a combination of merit and personal recommendations, knowing that evaluations of job candidates from previous managers and industry contacts were likely to be more trustworthy and end up adding value to the company. Lawsuits made giving a negative recommendation hazardous, though, so many companies changed their policy to prohibit managers and HR from giving out any opinion on performance records of past employees — which led to today’s kabuki dance where a troublesome employee is either damned with faint praise or blackballed in informal tone of voice phone calls, but never in writing.

As companies have grown and HR departments gained influence over hiring processes, most companies have tried to find ways to screen outside candidates that reduced the time-consuming and distracting work of resume evaluation and interviewing by hiring managers and team members. Recessions and slowing growth made hiring less frequent and many hiring staff and outside recruiters were eliminated as cost-saving measures. Personal recruiting was replaced by Internet sites and recruiting boiler rooms where low-paid recruiters cold-called prospects to almost accidentally match them with openings. That was a waste of everyone’s time, so now companies are trying out services that purport to automate resume screening and interviewing, presenting hiring managers with supposedly qualified candidates and prepackaged video interviews for quick evaluation.

But any centralized scheme for pre-screening new hires is subject to political influence — HR can bias the screening to boost AA candidates and blackball competent candidates of undesired classes, like whites, Asians, and older people. When a non-technical 30-year-old female HR screener sees a resume from a 58-year-old white male engineer, she can dismiss it based on her bias against a man she would probably have trouble controlling — and this bias in hiring is every bit as bad for the organization as a previous era’s bias against competent women and homosexuals. And no one is keeping statistics which might demonstrate how she is preventing some highly-competent candidates from being reviewed by the hiring manager and team.

There are several negative consequences. First, hiring managers may be unhappy with all of the candidates presented, unaware that some likely good fits were never allowed into the process. As a result, positions may stay open for long periods and much time is wasted rejecting inappropriate candidates who pass AA and HR screenings but can’t convince the team they’d be right for the role. Another negative is a tendency to stick with internal candidates, who are known quantities from internal word-of-mouth and detailed records available to the hiring manager. But fewer outside hires means less new and diverse process knowledge being added to the company, and the Silicon Valley-style cross-fertilization of innovation between companies in a hot new field can’t happen.

Hiring managers are aware of this, and the smart ones do their own search and bring in new people by effectively bypassing HR. The larger and more bureaucratized companies make this more difficult, which tends to slowly degrade their competitiveness; think of a regulated utility’s staff versus a growing software company’s. An older company in a regulated business will always be less dynamic, but can do well staffing an internal center for process and technology innovation by giving its manager complete staffing freedom and ignoring the usual rules.

In the reverse situation, many an innovative, fast-growing company has been gutted after an acquiring company begins to impose its own HR and personnel policies. Not only do innovators sense a loss of freedom to act without a committee’s permission to get things done, but the new hires vetted by the acquirer’s HR department are more likely to be clock-watching rule-followers who don’t want to be responsible for success or failure of their teams. Gradual decline ensues, and after the frustrated innovators leave, the slow-to-catch-on will dutifully work at their jobs until the parent company gives up, then move on to the next slot.

HR can resist this tendency, but only with leadership from the top — both CEO and a carefully-chosen head of HR can choose and groom HR staff to avoid this mistake.

Thought leaders in today’s HR specialize in jargon and “aspirational” BS — they want HR heads to be seen as visionaries leading their companies to a Nirvana of fulfilled, productive, and most of all diverse staff. Plenty of lip service is paid to productivity and beating the competition with quality and service, but the focus is more often on community feeling and fulfilling interpersonal relationships. That there might be some value in interpersonal conflict and disagreement over technological and market development doesn’t enter their discussions.

But as we will see later, surveys show the most productive and best teams are those whose members feel they have been able to demonstrate their talents. A team that is always harmonious may not last long if their products are the result of groupthink unchallenged by the idiosyncratic few — it’s hard to be happy when your company is losing its market share and your team is laid off. Diversity of opinion and good management judgement are key to being right and besting your competitors, who may have been forced to spend too much time watching diversity training videos and became cynically detached.

Here are some HR thought leaders, excerpted from the book The Rise of HR: Wisdom From 73 Thought Leaders,[1] published by the HR Certification Institute and obviously meant to be a sales tool for their services:

…We have always provided employees with talent development opportunities in compliance with affirmation action and equal employment opportunities. However, a clear and unabashed focus on diversity and inclusion to advance organizational excellence and success may be unfamiliar to some. HR must help instill a new mindset—one that goes beyond merely complying with non-exclusionary laws, but truly commits to core values and believes that, with guidance, every employee has the capacity to perform at high levels.[2]

This is “No Child Left Behind” view of staffing. Leaving behind the old view where the best candidate should be hired or promoted regardless of race or class, in favor of the social work view of HR: that candidates can be chosen for inclusion and groomed, trained, and managed to be great performers regardless of native talent and background. Businesses that can afford to view staffing as a kind of social uplift effort are few—mostly government agencies where there’s guaranteed funding and no competition is allowed.

Anyone who wants to see the trends in HR should skim this book. It’s full of uplifting visions and short on accounting and business nuts and bolts. Those visions are lovely aspirations — but demonstrate how easy it is to make pretty speeches or TED Talks disregarding the realities of human nature and competition in teams.

Not everyone is an airhead, however. China Gorman writes:

The best way to protect your culture’s integrity is to be meticulous in only hiring people who fit within it. Yes, it will be tempting to hire people who have amazing skills but may not fit your culture. Don’t do it. Don’t even think about it! Just as one bad apple can spoil the bunch, so can one bad hire throw a wrench in all the hard work you and your company have invested in creating a unique and wonderful culture. Always remember that skills can be taught, but culture fit is like style—people either have it or they don’t. Great culture is about never settling. It’s about doing the right thing, even when it’s hard. So wait for the right person. You’ll be glad you did, and so will everyone in your great workplace culture.[3]

This is true. If your workplace culture is focused on winning and growing in a free market, hiring those whose values are centered on whining about grievances and collecting rent on the value of the work of others through political power is going to poison your workplace culture and reduce morale. Now when HR managers in Silicon Valley talk culture fit, this is code for under 30, no family responsibilities, can work over 60 hours a week, and will put up with the preferred sports, progressive causes, and after-hours socializing of the other low-level staff. And not-so-subtle discrimination against even the most productive who don’t fit this mold is common in startup culture. But a culture which encourages employees to have rich family and personal lives away from the workplace doesn’t have to be less competitive — just smarter. Your best workers don’t work the longest or stay at the office until 10 PM; they’re experienced and knowledgeable enough to get their work done in less time, and your company won’t sink when your junior employees grow up enough to realize they’ve been cheated out of a life and leave for more sustainable workplaces.

Fortunately, hiring managers aren’t stupid, and (except in highly-regulated industries) they have resisted the HR pressure to hire too much diversity deadwood. And companies are still free to discriminate against people whose culture won’t be helpful — which is why management needs to be careful not to hire those gender and ethnic studies graduates who seem to want to be social justice activists on someone else’s dime.



[1] The Rise of HR: Wisdom From 73 Thought Leaders, edited by Dave Ulrich, William A. Schiemann, GPHR and Libby Sartain, SPHR, published by the HR Certification Institute, 2015. http://www.octanner.com/content/dam/oc-tanner/documents/ebooks/HRCI_TheRiseofHR-dual.pdf
[2] “HR as Organizational Leader and Champion of Diversity and Inclusion,” by Andy Brantley, from The Rise of HR, p. 217-225
[3] “CEOs Want Better Performance. Great Culture Can Make It Happen,” by China Gorman of Great Place to Work, from The Rise of HR, p. 179-188


Death by HR: How Affirmative Action Cripples OrganizationsDeath by HR: How Affirmative Action Cripples Organizations

[From Death by HR: How Affirmative Action Cripples Organizations,  available now in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. Here’s the condensed version; view the entire review here.

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits for running afoul of the government’s diversity extortion bureaus. HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat… It is time to turn the tide against this madness, and Death by HR is an important research tool… All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.

 


More Reading:

Death by HR: Biased HR Degree Programs Create Biased HR Bureaucracies
Death by HR: Pink Collar Ghettos, Publishing and HR
Death by HR: Who Staffs HR Departments? Mostly Women…
Death by HR: The Great Enrichment to the Great Slackening
Death by HR: Good-Enough Cogs vs Best Employees
Death by HR: EEOC Incompetence and the Coming Idiocracy
Death by HR: The End of Merit in Civil Service
Death by HR: History and Practice of Affirmative Action and the EEOC
Civil Service: Woodrow Wilson’s Progressive Dream
Bootleggers and Baptists
Corrupt Feedback Loops: Justice Dept. Extortion

On Affirmative Action and Social Policy:

Affirmative Action: Chinese, Indian-Origin Citizens in Malaysia Oppressed
Affirmative Action: Caste Reservation in India
Diversity Hires: Pressure on High Tech
Title IX Totalitarianism is Gender-Neutral
Public Schools in Poor Districts: For Control Not Education
Real-Life “Hunger Games”: Soft Oppression Destroys the Poor
The Social Decay of Black Neighborhoods (And Yours!)
Child Welfare Ideas: Every Child Gets a Government Guardian!
“Income Inequality” Propaganda is Just Disguised Materialism

The greatest hits from SubstrateWars.com (Science Fiction topics):

Fear is the Mindkiller
Mirror Neurons and Irene Gallo
YA Dystopias vs Heinlein et al: Social Justice Warriors Strike Again
Selective Outrage
Sons of Liberty vs. National Front
“Tomorrowland”: Tragic Misfire
The Death of “Wired”: Hugo Awards Edition
Hugos, Sad Puppies 3, and Direct Knowledge
Selective Outrage and Angry Tribes
Men of Honor vs Victim Culture
SFF, Hugos, Curating the Best
“Why Aren’t There More Women Futurists?”
Science Fiction Fandom and SJW warfare

Ban the Box - photo credit PBS

Death by HR – Ban the Box, Credit Scores, Current Salaries: The Road to Hiring Blind

So corporate hiring today is a mess, and about to get worse as progressives try to force companies to give up some of the few tools they have to disqualify criminal or unreliable applicants—with the usual noble motivations, of course. We’ll go over these efforts, then look at a new Seattle ordinance designed to limit discrimination in apartment rentals by forcing landlords to accept the first applicant who “qualifies,” which will evolve (if not pushed back) to limit allowed requirements until landlords essentially will be forced to take almost anyone. This idea of forcing acceptance of applicants will most likely soon be applied to hiring, as the social engineers gradually reduce any freedoms a business manager might have so that their client population can enjoy the benefits of being hardworking, reliable, self-controlled citizens without actually demonstrating any of those qualities. If US labor law ever reaches that late stage equality-of-outcome decadence, productivity will crumble, much as it did in the old USSR where jobs were similarly guaranteed and handed out based on pull. This kind of micromanagement of free-market employment practices is typical of progressives—to achieve the worthy goal (in this case, limiting invidious discrimination), they try to limit the use of management discretion in operating a business by passing unenforceable laws that tend to do more harm than good.

Progressives are working hard to outlaw use of credit scores or criminal records to screen job candidates. This is, of course, because bad records on either tend to identify less trustworthy, less reliable people that employers quite reasonably want to avoid hiring. The campaign to outlaw application questions about criminal records is called “Ban the Box,” and this catchy name means applications that include a box to be checked if the applicant has a criminal record are to be banned by law. Most such laws passed at state and local levels only ban the question on applications for government jobs or government contractors, since the legality of going further at the local level is questionable. But moves are afoot to make it part of Federal equal employment regulations.

It’s true that not every candidate who fails such screening would be a bad employee. Both ex-prisoners and bad credit risks might well have reformed, with the black marks on their record not indicating their current state of trustworthiness—and a wise employer might consider them by looking deeper into their background and directly questioning them on how they may have learned from their experiences. But employers who are going to rely on the keeping of promises to show up on time, work hard, and not steal from their employer are not wrong to think these are factors to consider.

Further, studies of “Ban the Box” laws show that they can actually harm the minorities they are intended to help. An employer who loses the ability to check for a criminal record may be more likely to act on prejudice—after all, prejudice and adverse stereotyping are strongest where information is limited. Being able to pass a criminal record check enhances a minority candidate’s chance of being viewed as a good risk for the employer. The most recent study demonstrated this effect:

“Ban-the-Box” (BTB) policies restrict employers from asking about applicants’ criminal histories on job applications and are often presented as a means of reducing unemployment among black men, who disproportionately have criminal records. However, withholding information about criminal records could risk encouraging statistical discrimination: employers may make assumptions about criminality based on the applicant’s race. To investigate this possibility as well as the effects of race and criminal records on employer callback rates, we sent approximately 15,000 fictitious online job applications to employers in New Jersey and New York City, in waves before and after each jurisdiction’s adoption of BTB policies. Our causal effect estimates are based on a triple-differences design, which exploits the fact that many businesses’ applications did not ask about records even before BTB and were thus unaffected by the law.

Our results confirm that criminal records are a major barrier to employment, but they also support the concern that BTB policies encourage statistical discrimination on the basis of race. Overall, white applicants received 23% more callbacks than similar black applicants (38% more in New Jersey; 6% more in New York City; we also find that the white advantage is much larger in whiter neighborhoods). Employers that ask about criminal records are 62% more likely to call back an applicant if he has no record (45% in New Jersey; 78% in New York City)—an effect that BTB compliance necessarily eliminates. However, we find that the race gap in callbacks grows dramatically at the BTB-affected companies after the policy goes into effect. Before BTB, white applicants to BTB-affected employers received about 7% more callbacks than similar black applicants, but BTB increases this gap to 45%.[1]

Most of these laws are presented as preventing pre-screening; the employer may still look into criminal records after deciding to offer the candidate a job. But the clear trend is to make ex-criminal status a protected class and outlaw discrimination on that basis. Another paper suggests employers are more likely to avoid even taking applications from minority candidates if these laws are in place, exercising a form of passive resistance that is hard to prevent:

Removing information about job applicants’ criminal histories [through Ban The Box (BTB) laws) could lead employers who don’t want to hire ex-offenders to try to guess who the ex-offenders are, and avoid interviewing them. In particular, employers might avoid interviewing young, low-skilled, black and Hispanic men when criminal records are not observable. This would worsen employment outcomes for these already-disadvantaged groups. In this paper, we use variation in the details and timing of state and local BTB policies to test BTB’s effects on employment for various demographic groups. We find that BTB policies decrease the probability of being employed by 3.4 percentage points (5.1%) for young, low-skilled black men, and by 2.3 percentage points (2.9%) for young, low-skilled Hispanic men. These findings support the hypothesis that when an applicant’s criminal history is unavailable, employers statistically discriminate against demographic groups that are likely to have a criminal record.[2]

Not screening hires for criminal records also subjects employers to big negligence awards when consumers are victimized by unscreened employees:

“Consider these allegations from a 2012 Virginia case,” Leeson said. “The employer hired a person to work in a hotel, and allegedly did not perform a background check or ask about the person’s criminal history. The person had previously been convicted of a felony sex crime. The person thereafter raped an 18-year-old hotel maid on her third day on the job. The maid sued the hotel for negligent hire. The case settled with the hotel agreeing to pay $675,000 to the former maid.” Ultimately, Leeson said, “I believe it is reasonable and prudent for employers to ask about prior convictions as one factor in the overall evaluation of the applicant.”[3]

But the laws are spreading rapidly and being applied to private employers as well:

Nine states — Connecticut, Hawaii, Illinois, Massachusetts, Minnesota, New Jersey, Oregon, Rhode Island, and Vermont — have removed the conviction history question on job applications for private employers, which advocates embrace as the next step in the evolution of these policies.

The majority of ban-the-box laws apply only to public employers, but blanket ban-the-box laws impacting all sectors are on the rise. Many advocates embrace private-sector ban-the-box laws as the “next step in the evolution of these policies,” according to the National Employment Law Project (NELP), a worker advocacy organization….

There are also various city and county ban-the-box laws around the country that apply to private employers…

Many ban-the-box policies exempt employers that have 10 employees or less, but some, such as Minnesota’s, do not. And while many private employers have balked at ban-the-box policies, at least two large retailers have jumped on board. National retailers Target and Wal-Mart no longer ask about an applicant’s conviction record during the initial phase of the hiring process, according to NELP. In order to comply with the 2013 Minnesota law, Minneapolis-based Target announced it was eliminating the box on its applications. Wal-Mart took that action in 2010.[4]

So if your area doesn’t already have a BTB law, it soon will.

Now to move on to the use of credit reports to screen candidates: credit reports are already regulated by Federal law, and since they aren’t cheap, companies rarely use them to pre-screen candidates. But they are widely used in the final stages of hiring decisions:

Employers get a shortened version of your credit report that excludes any information that would violate equal employment opportunity laws, explains Rod Griffin, director of public education for credit bureau Experian. An employer report also does not list “soft” inquiries, which do show up on the report an individual receives….

According to a 2012 survey conducted by the Society for Human Resource Management, 47% of employers check potential employees’ credit reports as part of the hiring process. The same study found that the two most common reasons for reviewing job candidates’ credit reports are to decrease the likelihood of theft and embezzlement and reduce legal liability for negligent hiring. According to an article in The New York Times, which cited the same survey:

“Most businesses use credit checks only to screen for certain positions, but one in eight, the survey found, does a credit check before every hire.”

But it’s important to remember that your employer can’t check your credit report without your consent; you must give written permission. Also, an employer won’t be seeing personal information, like your account numbers, when he or she reviews your report. The modified version that’s provided takes steps to protect your privacy.

Also, 11 states have laws prohibiting employer credit checks and/or restricting how this information can be used in the hiring process. If you live in one of these states, an employer credit check may not be something you need to worry about.[5]

Many employers are failing to follow the existing laws on use of credit reports, and as a result are getting hit with multimillion-dollar class action lawsuits:

Last year saw an increasing number of FCRA class-action lawsuits filed and settled for millions of dollars. FCRA violations can range from not making legally required disclosures to not following proper adverse action procedures.

“Not a month has gone by in over a year when there hasn’t been a major FCRA class action on background checks, and that trend has already continued into January,” said Nick Fishman, executive vice president at EmployeeScreenIQ.

We may see an “explosion” of FCRA class-action suits against employers and background screening firms as plaintiffs’ attorneys become more familiar with the law and the whole area of background checks, said Rosen. The financial recovery can be enormous—up to $1,000 per person in damages.

“Given the large statutory damages at issue, the promise of attorneys’ fees and punitive damages, along with the fact that there is an open question as to whether an individual need be actually harmed to bring an action, these claims will undoubtedly continue,” Devata agreed. Many FCRA claims have nothing to do with a person being harmed, but instead are the result of a mere technicality in the law, she added. …Employers should be aware that taking an adverse action—terminating an existing employee, rescinding a job offer to an applicant, denying a promotion—based on a consumer report “requires them to engage in a multistep process and requires close consideration of timed requirements,” said Do. “Bottom line, if negative information comes back on a background check, an employer simply can’t just pick up the phone and say ‘You’re not getting the job.’ ” Failing to provide a copy of the consumer report, failing to furnish a copy of the FCRA summary of rights document, and failing to provide the opportunity to dispute a report’s inaccuracies or errors, are common allegations, said Do.

These suits are the most troubling because they are the most avoidable, said Fishman. “These laws aren’t that hard to follow. Employers need to continually audit their processes and make sure that they comply with the law.”

It’s important to train incoming HR staff on the FCRA. “In many cases, with high turnover in HR departments, the sufficient training that was provided when an employer first signs on with a screening firm may not be adequately conveyed to new members. The likelihood that an oversight may result when an undertrained staff member fails to follow protocol then increases,” said Do.[7]

Notice how a seemingly well-motivated law not only removes hiring discretion, but with the help in this case of class action lawyers (who are part of the political class feeding off private industry with the help of the pols who write the laws), requires hiring more and more HR staff and consultants to administer and train for it. Every regulation imposed on employers increases non-productive staff and budget, and decreases the freedom to seek out the best employees without fear of government punishment. Every gain in “fairness” imposed by law costs everyone twice as much in lost growth and opportunity.

And banning use of credit checks in hiring has the same perverse effect as “Ban The Box” — it hurts minorities:

One of the hottest ideas among lawmakers right now is to ban employers from running credit checks on job applicants. Since 2007, eleven states, as well as Chicago and New York City, have passed such laws. Supporters of these restrictions often frame the issue as a civil rights problem. In particular, they say, credit checks impede employment among minorities, who disproportionately have low credit scores.

…But a new study from Robert Clifford, an economist at the Boston Fed, and Daniel Shoag, an assistant professor at Harvard’s Kennedy School, finds that when employers are prohibited from looking into people’s financial history, something perverse happens: African-Americans become more likely to be unemployed relative to others….

Why did black unemployment go up?

To understand how banning credit checks can lead to unforeseen repercussions, consider the problem from the employer’s perspective. A single job opening these days can get hundreds of applications. Since hiring managers can’t interview every candidate, they need some way to narrow the field. Filtering out people with bad credit helps them bring the number of applicants down to a manageable size. But if employers can’t look into a job-seeker’s financial history, they try something else.

“Employers have many screening measures to narrow down who they want to hire,” Shoag says. “If you take one away, they’ll put more weight on the others.”

That’s exactly what seemed to happen in places that outlawed employer credit checks. Looking at 74 million job listings between 2007 and 2013, Clifford and Shoag found that employers started to become pickier, especially in cities where there were a lot of workers with low credit scores. If a credit-check ban went into effect, job postings were more likely to ask for a bachelor’s degree, and to require additional years of experience.

There are other ways that employers could have also become more discerning, Shoag says. They might have started to rely on referrals or recommendations to make sure that applicants were high-quality. In the absence of credit information to establish trustworthiness, they may even have fallen back on racial stereotypes to screen candidates. The researchers couldn’t measure these tactics, but they’re possibilities.

Any of these reasons might explain one of the study’s strangest findings. In states that passed a credit-check ban, unemployment for African-Americans rose by about one percent compared to unemployment in other states and among other demographic groups. This remained true after controlling for factors like education, age, and gender.

… In the absence of that information, employers had to rely more on other clues about the quality of applicants, including their education and experience levels, but also, perhaps, their interview skills or their recommendations. Whatever the new criteria were, they seem to have put black applicants at a disadvantage.

“This reflects a general movement of legislators monkeying around with the hiring process without thinking about the consequences,” Shoag says.[8]

The latest in efforts to restrict information available to hiring companies is the so-far-not-cleverly-named movement to ban asking any questions about salary history. The theory here is that current and past salary history can be used to hold back women, since a new employer may well offer an increase based on the supposedly lower salaries women make under the yoke of discrimination. The practical need for both applicant and employer to discover whether they are even close to a negotiating range is, of course, not considered, because the appearance of helping women make better salaries is all that counts. Now employers may spend considerable effort to decide on a candidate only to discover the salary they were prepared to offer is far too low to interest the candidate.

Massachusetts was the first state to pass such a law.[9] But theirs goes further, attempting to enshrine the concept of comparable worth—even different jobs with similar labor and standards are supposed to pay the same. This was in response to a suit from largely female cafeteria workers paid just over half of what janitors in the same school system made; the obvious difference in working conditions (social and clean vs. nonsocial and dirty) which explain the relative attractiveness of the positions, and thus the pay differential, seem to be beyond the politicians. This subjective standard will occupy court time and allow more lawyers to extract profitable settlements for themselves.
Meanwhile, attempts to outlaw salary questions at the Federal level are ongoing:

Under the Pay Equity for All Act of 2016 (H.R. 6030), the U.S. Department of Labor would be able to assess fines up to $10,000 against employers who violate the law by asking questions about an applicant’s salary history. Additionally, prospective or current employees would be able to bring a private lawsuit against an employer who violated the law and could receive up to $10,000 in damages plus attorney fees….

Although many employers may not intend to discriminate on the basis of gender, race or ethnicity, asking for prior salary information before offering an applicant a job can have a discriminatory effect in the workplace that begins or reinforces the wage gap, according to a news release announcing the bill.[10]

Women need a Big Brother on their side to have a chance at negotiating a fair salary for themselves, and the Party of Government is happy to provide one. Or at least pretend to.



[1] “Ban the Box, Criminal Records, and Statistical Discrimination: A Field Experiment,” by Amanda Y. Agan (Princeton University – Department of Economics) and Sonja B. Starr (University of Michigan Law School), U of Michigan Law & Econ Research Paper No. 16-012, June 14, 2016. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2795795
[2] “Does ‘Ban the Box’ Help or Hurt Low-Skilled Workers? Statistical Discrimination and Employment Outcomes When Criminal Histories are Hidden,” by Jennifer L. Doleac and Benjamin Hansen, NBER Working Paper No. 22469, July 2016. http://nber.org/papers/w22469?sy=469
[3] “Ban-the-Box Movement Goes Viral,” by Roy Maurer, SHRM, 2016. https://www.shrm.org/ResourcesAndTools/hr-topics/risk-management/Pages/Ban-the-Box-Movement-Viral.aspx
[4] Maurer
[5] “Your Employer Won’t Be Looking at Your Credit Score—Here’s Why,” by Lindsay Konsko, Nerdwallet, August 1, 2016. Starts by saying employers don’t look at credit scores, then segues to how they actually look at credit reports. https://www.nerdwallet.com/blog/finance/credit-score-employer-checking/
[6] “The Use of Credit Reports in Employment Background Screening,” by Lester Rosen, CEO, Employment Screening Resources, and Kerstin Bagus, Director Global Compliance, LexisNexis Screening Solutions Inc., 2010. http://www.esrcheck.com/file/ESR-LN_The-Use-of-Credit-Reports-for-Employment-Background-Screening.pdf
[7] “Know Before You Hire: 2015 Employment Screening Trends,” by Roy Maurer, SHRM, January 27, 2015. https://www.shrm.org/resourcesandtools/hr-topics/talent-acquisition/pages/2015-employment-screening-trends.aspx
[8] “The law was supposed to reduce discrimination. But it made hiring more racially biased,” by Jeff Guo, Washington Post, March 23, 2016.
https://www.washingtonpost.com/news/wonk/wp/2016/03/23/the-law-was-supposed-to-reduce-discrimination-but-it-made-hiring-more-racially-biased/
[9] “Does new law mean real pay equity for women? Not quite,” by Shirley Leung, Boston Globe, August 4, 2016. https://www.bostonglobe.com/business/2016/08/04/things-know-about-massachusetts-equal-pay-law/uuiduzYp7EyiIBhxt14pSJ/story.html
[10] “Bill Banning Salary History Questions Goes Before House.” by Kathy Gurchiek, SHRM HR Today, Sep 16, 2016. https://www.shrm.org/hr-today/news/hr-news/pages/bill-banning-salary-history-questions-goes-before-house.aspx


Death by HR: How Affirmative Action Cripples Organizations

Death by HR: How Affirmative Action Cripples Organizations

[From Death by HR: How Affirmative Action Cripples Organizations,  available now in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. Here’s the condensed version; view the entire review here.

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits… HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat… It is time to turn the tide against this madness and Death by HR is an important research tool… All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.

More reading on other topics:


More Reading:

Death by HR: EEOC Incompetence and the Coming Idiocracy
Corrupt Feedback Loops: Public Employee Unions
Unrealistic Expectations: Liberal Arts Woman and Amazon Men
Stable is Boring? “Psychology Today” Article on Bad Boyfriends

HireVue app -- Google Play

“Death by HR” – HireVue, Video Interviews, and AI Job Searches

We’ve seen how HR is already mismanaging hiring by using primitive automation tools for screening, and how future progressive regulations may make the situation even worse. Meanwhile, social media and online profiles are providing more honest data on candidates than ever before, but HR is warning hiring managers not to look at it.

The good news may be that AI in smarter screening programs may be able to use online searches and carefully-designed online questionnaires to do a much better job of identifying possible great hires and screening out the deadwood. Meanwhile, leading-edge employers like Google have discovered overly-specific degree and experience qualifications can actually screen out some of the most productive people in the applicant pool. If any company can apply data analytics and AI to hiring and performance management, it would be Google. How did Google do when they tried? The New York Times interviewed senior VP of people operations (Google’s name for HR, apparently) Laszlo Bock in 2013:

Years ago, we did a study to determine whether anyone at Google is particularly good at hiring. We looked at tens of thousands of interviews, and everyone who had done the interviews and what they scored the candidate, and how that person ultimately performed in their job. We found zero relationship. It’s a complete random mess, except for one guy who was highly predictive because he only interviewed people for a very specialized area, where he happened to be the world’s leading expert….

On the hiring side, we found that brainteasers are a complete waste of time. How many golf balls can you fit into an airplane? How many gas stations in Manhattan? A complete waste of time. They don’t predict anything. They serve primarily to make the interviewer feel smart.

Instead, what works well are structured behavioral interviews, where you have a consistent rubric for how you assess people, rather than having each interviewer just make stuff up.

Behavioral interviewing also works—where you’re not giving someone a hypothetical, but you’re starting with a question like, “Give me an example of a time when you solved an analytically difficult problem.” The interesting thing about the behavioral interview is that when you ask somebody to speak to their own experience, and you drill into that, you get two kinds of information. One is you get to see how they actually interacted in a real-world situation, and the valuable “meta” information you get about the candidate is a sense of what they consider to be difficult.[1]

Google used to be known for hiring only people under 30, using those brainteasers to identify top programming talent and relying on academic qualifications, favoring degrees from prestigious universities. That’s no longer true:

One of the things we’ve seen from all our data crunching is that G.P.A.’s are worthless as a criteria for hiring, and test scores are worthless—no correlation at all except for brand-new college grads, where there’s a slight correlation. Google famously used to ask everyone for a transcript and G.P.A.’s and test scores, but we don’t anymore, unless you’re just a few years out of school. We found that they don’t predict anything.

What’s interesting is the proportion of people without any college education at Google has increased over time as well. So we have teams where you have 14 percent of the team made up of people who’ve never gone to college…. academic environments are artificial environments. People who succeed there are sort of finely trained, they’re conditioned to succeed in that environment. One of my own frustrations when I was in college and grad school is that you knew the professor was looking for a specific answer. You could figure that out, but it’s much more interesting to solve problems where there isn’t an obvious answer. You want people who like figuring out stuff where there is no obvious answer.

So how are they applying their famous data analytics to hiring for Google? Very methodically, as you would expect. According to an Atlantic story:

In the summer of 2006, Todd Carlisle, a Google analyst with a doctorate in organizational psychology, designed a 300-question survey for every Google employee to fill out… Some questions were straightforward: Have you ever set a world record? Other queries had employees plot themselves on a spectrum: Please indicate your working style preference on a scale of 1 (work alone) to 5 (work in a team). Other questions were frivolous: What kind of pets do you own?

Carlisle crunched the data and compared it to measures of employee performance. He was looking for patterns to understand what attributes made a good Google worker. This was strongly related to another question that interested his boss, Laszlo Bock, senior vice president of People Operations: What attributes could predict the perfect Google hire?

…Google was essentially trying to Google the human-resources process: It wanted a search algorithm that could sift through tens of thousands of people—Google’s acceptance rate is about 0.2 percent, or 1/25th that of Harvard University—and return a list of the top candidates. But after a great deal of question-asking and number-crunching, it turned out that the best performance predictor wasn’t grade-point average, or type of pets, or an answer to the question, “How many times a day does a clock’s hands overlap?” The single best predictor was: absolutely nothing.[2]

Much research shows referrals to be the most reliable source of better hires, so Google’s early emphasis on ties to computer science professors to recruit the best students for their early programming teams was a good if limited strategy. Referrals are more likely to be “good fits” because the skills needed for good teamwork are more likely to get someone referred:

The study found that referrals produce “substantially higher profits per worker” who are “less likely to quit,” “more innovative,” and “have fewer accidents”—all this, even after controlling for factors like college, SAT scores, and IQ. Team-based companies require openness, compatibility, and a willingness to cooperate. Referral programs work because great employees pass along workers who similarly match the company culture.

Although they account for only six percent of total applications, referrals now result in more than a quarter of all hires at large companies, according to a recent paper from the Federal Reserve Bank of New York and MIT….

Google, which depends on referrals, once administered up to 25 interviews for each job candidate. Todd Carlisle, the organizational psychology doctorate who administered the company’s surveys in 2006, thought this might be overkill. He tested exactly how many interviews were necessary to be confident about a new hire. The right number of interviews per candidate, he discovered, was four. This new policy, which Google calls the Rule of Four, “shaved median time to hire to 47 days, compared to 90 to 180 days,” Laszlo Bock wrote in his book Work Rules.

But Carlisle’s research revealed something deeper about the hiring process, which has resonance for every industry: No one manager at Google was very good, alone, at predicting who would make a good worker.

Four meticulously orchestrated Google interviews could identify successful hires with 86 percent confidence, and nobody at the company—no matter how long they had been at the company or how many candidates they had interviewed—could do any better than the aggregated wisdom of four interviewers.

It turns out that a single Google hiring manager, at least, is often not that good at judging candidates — but when four of their judgments are combined, the result is as good as it’s going to get. This convinced the company to drop their over-interviewing policies, which took much candidate and staff time and delayed hiring by months.

So what are the prospects for automating hiring? Aptitude test scores have considerable predictive value in many cognitive jobs, but could one automate the emotional intelligence and teamwork skills testing needed to find good team workers? Google has tried and (at least as far as they’ve disclosed their practices) failed to find anything better than referrals and face-to-face interviews.

But software companies keep trying to improve ATS (Applicant Tracking Systems) functions to do a better job:

Companies such as Facebook, GE, IBM, Hilton Worldwide, SAP and many others have been slowly adding data analytics into their recruitment practices. A few years ago, it was unheard of to scan candidate resumes for data, but now it’s commonplace. Machine intelligence is being used to scan through other aspects of candidate information, such as their social media content, their facial expressions, even their work samples to identify top candidates – and weed out the undesirables.

“Such practices raise questions about accuracy and privacy, but proponents argue that harnessing AI for hiring could lead to more diverse, empathetic, and dynamic workplaces,” says Sean Captain, a journalist with Fast Company.

…“corporate recruiting is broken” as a system. It’s filled with inaccuracies and black holes where candidates disappear…. “85% of job applicants never hear back after submitting an application.” This indicates that some recruiters are still not able to stay on top of recruitment processes, and the candidate experience has a long way to go towards being a positive one.

Perhaps there is room for more automation and AI in recruitment if it can restore better recruitment practices from the human side of things. Kibben mentions that AI will improve the candidate experience and is a winning proposition for recruiters who will be able to strategically partner with hiring managers instead of simply filling job requests.[3]

Lots of buzzwords and promises, few real advances. One semi-useful tool now becoming popular is the automated interview system — imagine an online interviewing system where the applicant answers preset questions in front of their PC, laptop, or phone camera, with the video uploaded for later replay by HR staff and hiring managers. This certainly cuts down the overhead of doing interviews — no more paying to fly candidates out and take them to dinner, just video dating-style files to pick up those subtle clues about the candidate normally gleaned from a face-to-face interview.

How does that work out in practice? A company called HireVue claims to analyze video interviews using AI tools:

The deep dive into a candidate’s mind isn’t a new idea, says Mark Newman, founder and CEO of HireVue. Founded in 2004, it was one of the pioneers in using AI for hiring. Its specialty is analyzing video interviews for personal attributes including engagement, motivation, and empathy. (Although it also uses written evaluations.) The company analyzes data such as word choice, rate of speech, and even microexpressions (fleeting facial expressions).[4]

But most users of their systems are just looking for a cost-effective substitute for face-to-face interviews, with only a few using “AI” to evaluate the candidate videos. HireVue is increasingly important:

HireVue Inc., which provides video interviewing software for Goldman Sachs and 600 other firms, said it hosted nearly three million video interviews last year, up from 13,000 five years ago….

Most video-interviewing programs require applicants to click a link or install an app. Interviews begin with a prompt such as “Tell us about a time you had to deal with a conflict” that stays on-screen for about 30 seconds. Then, the camera turns on and the candidate has anywhere from 30 seconds to 5 minutes to respond before the next question pops up.

Human-resources staff then review the videos and pass along promising applicants to managers for consideration. Applicants who make the cut are typically invited to a one-on-one interview. That doesn’t always mean it will be in-person, though. Varsha Paidi, a software engineer hired by IBM last year, had subsequent online interviews and eventually received her job offer via text message.

Speeding up the hiring process allows recruiters to look at more applicants than before, giving companies wider reach, said Obed Louissaint, the human-resources lead for IBM’s Watson division.

Applicants, however, say that computer-guided interviews take some getting used to. Amy Hall was never the type to get nervous during job interviews, but when the 29-year-old had to complete a video interview last year for an internal job switch at Cigna-Healthspring, she recalled feeling apprehensive and camera-shy. She waited until after work hours and used a computer in the IT department. With the door closed, she clicked a link to Cigna’s video-interviewing site….

Companies say they seek similar traits in video interviews as they do in traditional interviews. Recruiters at IBM and Cigna said they evaluate candidates based on how well the person communicates his/her thought process, whether the person answers all parts of the question—and whether he/she makes eye contact…

Video interviews might also present some problems because managers cannot ask follow-up questions or engage candidates further on a point, said Carol Miaskoff, assistant legal counsel for the Equal Employment Opportunity Commission. In letters to vendors, Ms. Miaskoff has suggested that companies assign more than one person to review individual videos to ensure hiring decisions aren’t made hastily.

Taking robo-recruiting one step further, some HireVue customers have an algorithm review the video interviews for them. Using data about the skills and attributes companies are seeking for a given role, a program called HireVue Insights scans videos for verbal and facial cues that match those skills then ranks the top 100 applicants.[5]

Given that in-person interviews by staff tend to wander and often turn into staff evaluations of whether the candidate will be enjoyable company or not, a fixed format with questions set in advance does actually promise to reduce the element of good-old-boyism. Everyone has experienced the job interview that turns quickly to discussion of sports or hobbies in common — the interviewer pays less attention to skills and attitudes than shared cultural enthusiasms, tending to favor cultural clones of themselves whose company they will enjoy. But notice that most companies still rely on human HR staff judgement to screen the resulting videos, which saves time for hiring managers but still introduces an element of HR prejudice. If your HR staff are primarily left-leaning New England-educated feminists, a white male candidate with a Southern accent and stereotypically male mannerisms will likely be screened out. For once the EEOC advice is reasonable — this type of screening will be more effective if more than one person reviews each video, making it more difficult for prejudice to prevail.

Giving HR staff veto power over candidates seems unwise. Practical considerations require obviously unqualified candidates to be weeded out early when a position attracts large numbers of applicants, but hiring managers and team members should invest the relatively minor time it takes to review these types of video responses themselves, as they are likely to be the best judges of culture fit and attitudes revealed by video.

Applicants encounter HireVue and similar video interviewing systems frequently now, and not everyone is happy—they find the idea insulting and intrusive. One question at Ask the Headhunter:

[The questioner’s wife] landed two job interviews with hiring managers within three weeks. Suddenly, a personnel jockey injected himself into the ongoing discussions with the hiring manager. The recruiter insisted that my wife submit herself to a one-way, online digital video taping, answer a series of pre-selected “screening questions,” and upload it to who knows where for “further review and screening” by who knows whom.

She found the request creepy, impersonal, presumptuous, Orwellian, exploitative, voyeuristic, unprofessional, and perhaps even unethical. She declined, instantly prompting an automated “Do Not Reply” rejection e-mail. She was not worthy because she wouldn’t subject herself to a dehumanizing “HireVue Digital Video Interview.”

This new wrinkle in HR practices seems like the most unsettling and counterproductive yet. It not only removes access to the hiring manager, but also live, human interaction. It sounds like “HR pornography,” where perverted personnel jockeys huddle around a monitor to gawk at videos of “virtual job candidates,” picking apart perceived blunders while they screen you out.[6]

The Headhunter, Nick Corcodillos, suggested the candidate respond in this situation by expressing a willingness to do a Skype interview with the hiring manager, cheaper (no payment to HireVue) and more personal. He suggests HR has an agenda in using such impersonal services: “What they mean is, we don’t want you to see the personalities of our personnel jockeys because, face it, they’re a bunch of data diddlers that we don’t want talking to anyone.” I’d say that is correct. In this case the applicant already spoke to the hiring manager, but HR is trying to force use of its process using HireVue for bureaucratic control reasons. If it should come to an EEOC complaint, having anyone escape their uniform process would be seen as evidence of favoritism having disparate impact on minorities.

There’s nothing wrong with these video interviewing services — ideally they substitute for expensive and time-consuming travel to meet with HR staff and hiring managers. But in practice, some companies now use them along with ATS screening techniques to completely depersonalize all but the last stages of hiring — the candidate does a lot of work, but no one at the company spends any time on their application at all until pre-screened and pre-interviewed. Meanwhile, candidates who contact hiring managers directly or run into them at professional functions or through work at companies in the same industry get the further advantage of being personally known in advance.

It does cost a lot to hire through HR — the arms race of HR automation leads to candidates using automation to contact far more potential employers, leading to avalanches of applications, leading to more ineffective automation. Hopeful noises about AI assisting are so far just that. In principle, AI could do a good job of analyzing resumes and interview videos and deliver the best candidates to hiring managers. In practice, no one is delivering anything more than hype.

Typical of the hype: HiringSolved, a startup promising Siri-like hiring assistance:

HiringSolved will soon unveil what it considers “Siri for recruiting,” an artificial intelligence assistant for recruiters. His name will be RAI, pronounced like the name Ray, and standing for “Recruiting Artificial Intelligence.”

The company has been working on it for five years, and is still perfecting it. The gist of it is you’d ask recruiting questions to a Chatbot-like system. So, instead of checking off a bunch of boxes, you’d type something like, “I need to find 10 female developers with experience using WordPress, within 10 miles of Milwaukee.” Or, perhaps, “What was the most common previous title of a systems engineer at Raytheon?”

Perhaps later, like with Siri, you’d use voice, not typed, commands.

HiringSolved’s RAI tool could also ask you follow-up questions, not unlike a conversation between a recruiter and a manager. If you, say, want a mechanical engineer, it might ask you to narrow your searches. Nuclear? Petroleum? Aerospace?

The idea is that the artificial intelligence will make you a better recruiter/sourcer, guiding you through questions that very experienced sourcers ask themselves in order to chop through a database and hone in on who they want.[7]

Chatbots and Siri, soon to save the day! Smart employers will pay the price to hire good, connected recruiters who have personal contacts in the industry. AI may one day allow applicants to prove themselves worthy without human intervention, but that day is a long way off.


[1] “In Head-Hunting, Big Data May Not Be Such a Big Deal,” by Adam Bryant, New York Times, June 19, 2013. http://www.nytimes.com/2013/06/20/business/in-head-hunting-big-data-may-not-be-such-a-big-deal.html
[2] “The Science of Smart Hiring,” by Derek Thompson, The Atlantic, April 10, 2016: http://www.theatlantic.com/business/archive/2016/04/the-science-of-smart-hiring/477561/
[3] “How AI and recruiters will work together in the near future,” by Tess Taylor, HRDive, September 15, 2016. http://www.hrdive.com/news/how-ai-and-recruiters-will-work-together-in-the-near-future/426291/
[4] “Can Using Artificial Intelligence Make Hiring Less Biased?” by Sean Captain, Fast Company, May 18, 2016. https://www.fastcompany.com/3059773/the-future-of-work/we-tested-artificial-intelligence-platforms-to-see-if-theyre-really-less-
[5] “Video Job Interviews: Hiring for the Selfie Age,” by Dahlia Bazzaz, Wall Street Journal, August 16,2016. http://www.wsj.com/articles/video-job-interviews-hiring-for-the-selfie-age-1471366013
[6] “HR Pornography: Interview videos,” by Nick Corcodillos, Ask the Headhunter®, October 14, 2014. http://www.asktheheadhunter.com/7537/hr-pornography-interview-videos
[7] “A Cousin Of Siri Is Coming To The Recruiting Field,” by Todd Raphael, ERE Recruiting Intelligence, September 8, 2016. http://www.eremedia.com/ere/a-cousin-of-siri-is-coming-to-the-recruiting-field/


Death by HR: How Affirmative Action Cripples Organizations

Death by HR: How Affirmative Action Cripples Organizations

[From Death by HR: How Affirmative Action Cripples Organizations,  available now in Kindle and trade paperback.]

The first review is in: by Elmer T. Jones, author of The Employment Game. Here’s the condensed version; view the entire review here.

Corporate HR Scrambles to Halt Publication of “Death by HR”

Nobody gets a job through HR. The purpose of HR is to protect their parent organization against lawsuits… HR kills companies by blanketing industry with onerous gender and race labor compliance rules and forcing companies to hire useless HR staff to process the associated paperwork… a tour de force… carefully explains to CEOs how HR poisons their companies and what steps they may take to marginalize this threat… It is time to turn the tide against this madness and Death by HR is an important research tool… All CEOs should read this book. If you are a mere worker drone but care about your company, you should forward an anonymous copy to him.

More reading on other topics:


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The Justice is Too Damn High! – Gawker, the High Cost of Litigation, and the Weapon Shops of Isher
Regulation Strangling Innovation: Planes, Trains, and Hyperloop
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