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Pre-employment testing: Effective tool to reduce absenteeism and Workers’ Comp claims and improve productivity

EEOC issues new fact sheet
A bad hire is one of the most costly mistakes an employer can make. Yet, many employers fail to evaluate thoroughly potential employees before making the decision to hire them.

More employers are utilizing employment testing due in part to post 9-11 security concerns, issues related to workplace violence, safety, and liability as well as the large-scale adoption of online job applications that require efficient ways to screen big applicant pools in a non-subjective way. Yet, others shun their use, believing that there are too many risks involved, particularly increasing their exposure to being sued.

Some of the tools available to employers include skill testing, character assessment, and fit-for-duty exams. The legal risks associated with these hiring activities, while they do exist, are minimal compared to the risk of hiring the wrong person. Moreover, assessments, when used properly, can help reduce exposure to charges of discrimination or privacy breach because they add objectivity to the selection process.

Both skill testing and personality assessment tools are subject to uniform guidelines. The Equal Employment Opportunity Commission’s (EEOC) Uniform Guidelines on Employee Selection Procedures provide a framework to help ensure that a test used as part of the hiring process will be employed in a non-discriminatory manner.

The EEOC has issued an extensive fact sheet on the application of federal anti-discrimination laws to employer tests and other selection procedures to screen applicants for hire and employees for promotion. The technical assistance document is available on the agency’s web site at

The fact sheet describes common types of employer administered tests and selection procedures used in the 21st century workplace, including cognitive tests, personality tests, medical examinations, credit checks, and criminal background checks. The document also sets forth “best practices” for employers to follow when using employment tests and other screening devices, and cites recent EEOC enforcement actions.

An area of particular relevance to Workers’ Compensation is pre-employment physicals. If a company requires “fit-for-duty exams” to avoid hiring a Workers’ Comp claim, they should be structured so that they comply with privacy laws and the American with Disabilities Act (ADA). Employers are limited in the scope of allowable inquiries before making a conditional job offer. Our strategic partner, HR That Works!, notes that the ADA allows prehire inquires on an application into the ability to perform a particular job (e.g., Can you lift this 30-pound mail sack with or without accommodation?) but prohibits pre-offer inquiries about a generalized disability (e.g. Have you ever been injured when lifting?).

However, after making a conditional job offer an employer can ask about the employee’s Workers’ Compensation history, sick leave usage, medical challenges, etc. as well as require a medical examination, provided that all candidates who receive a conditional job offer in the same category are required to take the same examination and/or respond to the same inquiries. If the employer chooses not to hire someone based on their medical history, the decision must be directly related to their inability to perform the job up to a certain standard or because in doing so, they may harm themselves or others. Employers with more than 15 employees are required to consider job accommodations. It is recommended that medical inquires be done by a physician and that the physician maintain the underlying records.

Another objection sometimes heard about pre-employment testing is that it doesn’t work. A study by PreVisor, Inc. of 29 organizations, including several Fortune 1000 employers from the retail, telecommunications, health care and financial services industries found that the use of tests have enabled employers to “accurately correlate candidate assessment scores with performance on the job, creating measurable and sustainable improvements to business results.” One result is reduced turnover. For example, in a warehousing and distribution role, 43% of associates who scored high on a customized job-fit measure remained on the job after 90 days, whereas only 23% of those who scored low on the assessment were retained.

When managed properly, integrating pre-employment testing into your hiring process can decrease turnover, improve productivity as well as reduce the likelihood of employment practices lawsuits. For more information, contact us.