Barring the Unemployed from Applying to Jobs—Absurd!

People say that "it’s easier to get a job when you have a job." Now some employers and job search firms are taking this old saying to a new level by excluding unemployed job seekers from their applicant pools entirely, either limiting applicants to those who are currently employed or those who have been employed within a recent period of time. Yesterday I had the privilege of testifying before the EEOC on the impact of this absurd practice on women, whose overall unemployment rate has actually risen during the economic recovery.

There is no doubt that this practice is a bad idea—there was consensus from everyone in the room on that point. But businesses that refuse to consider unemployed job applicants may also violate federal law. To the extent that employers are refusing to consider only some categories of unemployed workers—for example, only female caregivers—the practice may be prohibited by Title VII. And Title VII also prohibits employers from using a practice that disproportionately excludes people based on their sex, race, national origin, or religion unless the employer has a business need for the practice—a standard that would be difficult for an employer to meet without evidence that it actually predicts employee performance.

There are at least three reasons that employers’ exclusion of the unemployed from applicant pools may have an adverse impact on women.

• First, when an employer restricts applicants to those who have been employed at some point within a recent period of time, the restriction is likely to have a disparate impact on certain categories of women, including older women and women of color, who have higher rates of unemployment.
• Second, excluding the unemployed from applicant pools may have a disparate impact on women in occupations for which women experience greater unemployment than men, many of which are nontraditional fields for women that offer higher pay.
• Third, employers that restrict applicant pools to those who are already employed risk imposing a disparate impact on caregivers, some of whom leave the workforce temporarily to care for young children, ailing parents, or disabled family members.  Caregivers who have not actively sought employment in the previous month are not reflected in unemployment statistics.  Nevertheless, like their formally “unemployed” counterparts, when female caregivers do decide to return to the workforce, they will be shut out of positions open only to individuals with current employment.

I am not aware of any evidence demonstrating that the exclusion of unemployed applicants is a good idea or job-related for any occupation. Nor can I even imagine a rationale that would be consistent with Title VII. And no justifications were offered by the business community at the EEOC hearing.

The EEOC took an important step yesterday in holding this hearing. And I hope the employers that currently refuse to hire the unemployed got the message loud and clear and put an end to this bad idea.