Psychology in Hiring

Some scrap recyclers are taking advantage of testing tools that try to take some of the guesswork--and risk--out of hiring. Here’s a look at how they work. 

By Jeff Borsecnik

Jeff Borsecnik is an associate editor of Scrap Processing and Recycling.

Scrap recycling executives can attest to it: Hiring is tough. Typically working from a mix of sometimes scanty information on applicants’ skills and experiences plus impressions garnered from interviews, you’re left to match the right people with jobs. And if you’re wrong, the company could feel it in dollars, workplace morale, and even safety. Given this scenario, many companies are trying to trim the subjectivity of the hiring process by using scientifically designed, objective tests to screen candidates.

Most employers, in fact, use some pre-employment tests, ranging from basic skills to intelligence and drug tests. But there are many other variables that can determine an employee’s ability--and desire--to do the job. Thus, more and more employers today are looking beyond basic aptitudes to try to figure out what kind of person fits well in certain job or may roil the waters, and there are plenty of experts in industrial psychology providing tests designed to help you make that determination.

A Slippery Subject

Such tests that probe personalities to try to find the right people for jobs can take a variety of forms--measuring any mix of skills, attitudes, and behavior patterns--trait tests, honesty tests, dependability tests, integrity tests, personality tests, and more. Because different publishers use different terms to describe tests that measure similar things, there are no generally accepted definitions for such terms, says Scott L. Martin, Ph.D., director of psychological consulting for London House and Science Research Associates (Rosemont, Ill.), a test publisher that specializes in human resources management. Even the term "psychological test" is too broad to have much meaning, he notes, since it could even cover a job interview or a skills test if designed by a psychologist.

Nomenclature aside, perhaps the most popular kind of psychological tests used in human resources management are tests sometimes called "personality tests" or impersonality inventories." These typically consist of a number of true-or-false and/or multiple choice questions that must be completed with pencil and paper within a certain time period. Most examine a range of basic personality traits such as attitudes, emotional stability, and reliability, but they may aim at one or several particular traits deemed applicable to a particular job. For example, a test developed for a scale operator position might simply measure honesty, or it might examine honesty plus ability to sell and provide customer service and likelihood of sticking with the job. In fact, the bottom line is that a test can be developed to try to measure nearly any psychological characteristic of job candidates.

The kinds of questions used on these tests vary according to what they're trying to measure. Some tests might ask applicants to select the term that most closely describes themselves from a list, such as "attractive,” “God-fearing," "humble," and “sweet." Multiple choice questions, meanwhile, might range from a direct inquiry into the amount of money the applicant stole from his previous employer to ethical questions, such as "Is it OK to borrow money from your employer if you intend to return it?" or "How many people do you think would refuse to buy 'hot' merchandise?" Possible true-or-false questions include: "I often feel tired in the morning" or "I don't enjoy using guns."

The questions are considered objective measures--they can be scored and compared with some larger sample group--and are based on different psychological theories. For example, the question on hot, merchandise relies on the theory that people tend to project their opinions and attitudes on others, assuming others are basically like themselves. In addition, the written tests can be used in conjunction with other psychological methods.

Some tests also include questions designed to check the applicant's forthrightness. For example, a question like "Have you ever told a lie?" might help indicate how candid the test taker is being on more serious questions, like the theft issue. These kinds of checks work, Martin says, because many test takers have a hard time distinguishing between the real-issue questions and the reality checks. And surprisingly, he points out, about 3 to 5 percent of test takers will actually flat-out admit something serious on the tests, such as stealing from a previous employer.

While tests vary widely, there are generally accepted guidelines on their use and development-known as the "Standards for Educational and Psychological Testing," put together by the American Psychological Association in conjunction with the American Educational Research Association and the National Council for Measurement in Education (all based in Washington, D.C.).

Applying Exams

Because of the variety and customization of psychological tests available, their use in hiring should begin with a careful evaluation of the job and the characteristics needed to perform it, an assessment that should be performed with input from an industrial psychologist or other expert.

Once the characteristics have been identified, the expert can select or design a way to measure these attributes--a test. In most cases, a prewritten test or combination of tests can be used, but sometimes a test may be created for an employer. London House, for example, will compile into a booklet the tests needed for a particular position. The client purchases the tests on a per-booklet basis, typically at a cost of around $5 to $20, which includes scoring. The importance of the job and the number of characteristics measured are likely to determine how extensive--and expensive--the package will be.

Scrap recycling companies that use psychological tests in their hiring process put them to varying uses, ranging from weeding out the weakest of applicants to confirming a candidate selected for employment.

Annaco Inc. (Akron, Ohio), for one, uses several different psychological tests in evaluating job candidates. The most basic is the "Employee Reliability Inventory," published by Bay State Psychological Associates Inc. (Boston), which measures reliability and likelihood to stay on the job, perform safely, be honest, and remain free of drugs. The company gives the 80-question true-or-false exam to all of its hourly workers, who typically begin as temps before they are to be hired permanently. This $ 10 test is administered by the firm with results scored through the help of a computer program provided by the test publisher.

Potential managers and sales people, plus some hourly workers being considered for supervisory posts at Annaco take a more-extensive, five-to-six hour set of tests administered by a consulting firm. This exam, which covers basic aptitudes as well as in-depth psychological profiling, costs anywhere from several hundred dollars up to $1,500, depending on the job and the consultant used.

In any case, Annaco uses the tests primarily to confirm job candidates that the company is pretty certain about, says Robert Toth, human resources manager: "We want to convince ourselves. If everybody loves the guy, we test him, then we hire him unless there are serious red flags-then we take a closer look."

M. Lipsitz and Co. Inc. (Waco, Texas) also uses a substantial battery of tests, evaluating all manager-trainee candidates in a number of characteristics--ranging from their understanding of business terms to mental alertness, memory, sociability, emotional maturity, competitiveness, and stamina. In essence, says company President and Chief Executive Officer Tom Salome, the test was developed to help “clone some of our better managers." With the help of a consultant, he explains, the firm evaluated the personalities of its existing managers, determined what traits the good managers had in common, and then set out to use tests to find candidates with similar characteristics. The company now administers the exam itself at a cost of about $125 per candidate.

For another example, look to Metal Exchange Corp. (St. Louis), which uses extensive psychological testing handled by a consulting firm as a final step in the hiring process for facility managers and "everyone that has a significantly responsible position," as Morris S. Lefton, Metal Exchange president, puts it. Its exam measures candidates' capabilities and the likelihood they will mesh with the company. The process costs the company $700 to $800 per candidate, but Lefton looks at the program as a way to save money and frustration down the road: "It's a useful tool for trying to match whether the person we're considering is going to work out or not. Bringing people into the company and spending time, energy, and dollars to train them to find out they are not a good fit is painful for us and them. We look at the testing as a good tool that keeps everyone from making mistakes."

What’s the Scope?

The format of test results will vary as widely as the tests themselves, but here's what London House typically provides its clients: absolute scores (0 to 100) for each characteristic measured, a corresponding percentile value showing how the results compare to other test takers, and a composite score. The report also notes "significant behavior indicators"-particularly striking information about the candidate that the employer might wish to investigate further in an interview. Also included are a numerical "candidness scale" plus an 61 accuracy scale," which points out if the test taker was "processing properly" and didn't answer randomly or have trouble reading the test, explains Martin.

Reports on the tests taken by Annaco's manager candidates, meanwhile, are presented in a profile that begins with factual information about the candidate. It then lists numerical scores on such traits as drive, motivation, reliability, sociability, ingenuity, and aggressiveness, followed by a description of what kind of behavior these scores generally indicate. The report also provides some descriptive evaluations, such as "low," "moderate," or "high" for honesty and integrity. Additional results include a numerical "learning and trainability index" and general comments about the individual's personality, such as "The individual is typically analytical, is not bored with details, is cautious

Some test publishers or consultants also include recommendations on hiring or promoting the candidate. Others may simply describe the kind of behavior and level of on-the-job success to be expected from candidates with certain kinds of scores.

Making Tests Count

Of course, psychological tests are not without their critics, who question their scientific validity, pointing out that personality characteristics are difficult to measure and behavior is hard to predict. Given these inherent uncertainties, employers ought to be careful in selecting and using tests. "Reputable test publishers should have a series of studies from different organizations that show the test appears to be valid," says Martin. Such validation might rely on results collected from a large pool of individuals who have already taken the test--and their subsequent performance on the job--or it might be based on the use of a control group, or other appropriate techniques. Supporting evidence can be read from the credentials of the publisher and/or consultant involved in the testing. Furthermore, advises Dianne Schneider, a research project officer for the American Psychological Association, no one test should be the basis for hiring or rejecting an applicant, but should instead be seen as among all contributing factors.

If you feel comfortable with the test, the provider, and its methods, don't let naysayers dissuade you, says Martin. After all, he notes, "What we are doing is using science toimprove the accuracy of the selection process. Say your employee selection process without the testing is 60 percent accurate. By using an effective test, if you improve that to 80 percent, that's cutting the efforts by 50 percent. That's good if we can do it for $ 10 a pop."

Recyclers who use the tests do seem to find them worthwhile-when used in conjunction with careful interviews and reference checks. Lefton, for example, who has used psychological tests for about 20 years, says the tests have "a very good batting average ... By and large, the great majority are very close. But we don't view them as infallible or a panacea, just another tool."

Testing and the Law

Job-related testing of any kind can bring up legal concerns, especially in two areas--privacy and discrimination. The courts have generally been taking a restrictive view of drug testing and are likely to take a similar stance on psychological testing, according to Gary S. Marx, senior partner with Marx & Krame (Washington, D.C.) and labor counsel to the Institute of Scrap Recycling Industries (Washington, D.C.).

The Privacy Question. Many states have enacted laws that specifically restrict certain types of inquiries employers can use with applicants. And some such as California have established more broadly defined constitutional or statutory rights to privacy, notes Marx. As a result, Marx suggests that while you may be able to find out on your own if any such laws exist in your state or locality, if your firm is planning to implement a testing program, you should consult with an attorney about state common law privacy decisions and their potential application to testing before proceeding.

Potential for Discrimination. Civil rights law and regulations bar use of employment tests that unfairly discriminate against protected classes of people. Do psychological tests represent this kind of discrimination? That depends. The Equal Employment Opportunity Commission has ruled that psychological tests are not a “medical exam” under the American’s With Disabilities Act (ADA), which allows use of such tests on job applicants before a job offer has been made. But the ADA could apply to the tests if they identify a person with a protected disability or perceived disability (such as depression or alcoholism) and the applicant is subsequently refused a job and sues on the basis of discrimination, Marx notes. The ADA should not come into play, however, if the test only keys on character traits that are not related to any disability.

Here are some general guidelines Marx offers to make testing as fair as possible and limit legal risks.

Handle the testing in the fairest and least-offensive manner possible, avoiding any sort of discrimination.

Keep test results confidential, but consider giving results to the employee. (This may limit invasion-of-privacy suits.)

Test questions should be as unintrusive--and directly job-related--as possible.

Provide as much advance noticed with as complete detail as possible to applicants or employees that are to be tested.

Consider allowing employees/applicants a second opportunity to take the test, at their own expense, if they are denied a job or promotion and the test was a major factor in that decision.

Require the test provider to indemnify your company against damages and testify at no charge, in necessary, in case any suits are brought against the company as a result of the test.

Carefully weigh the potential benefits of and the risks of any test program you decide to use.

For More Information

Employment-related tests are described in several books, including Tests in Print, published by the Buros Institute for Mental Measures at the University of Nebraska (Lincoln), and Tests, published by Pro-Ed Inc. (San Antonio). Mental Measurements Yearbook, also by Buros, offers independent reviews of available tests by psychologists or measurement specialists. The names of test publishers and psychological consultants may be available from the psychology department of local universities or from state psychological associations. (Call the American Psychological Association at 202/336-5500 for the numbers of state associations.)  •