Kroger and Kronos: Chaos and Disorder

In classic Greek mythology, Kronos (also known as Cronus) was the leader of the first generation of Titans. Cronus was usually depicted with a sickle or scythe and the Greeks considered Cronus a cruel and tempestuous force of chaos and disorder.

Kronos, the company, is a U.S.-based workforce management software and services company. According to the company, tens of thousands of organizations in more than 100 countries - including more than half of the Fortune 1000 - use Kronos to control labor costs, minimize compliance risk, and improve workforce productivity.

In August 2006, Kronos acquired Unicru, Inc., a company specializing in software used to assess and hire hourly workers. At the time of the acquisition by Kronos, Unicru had as customers more than 140 leading companies and brands, including SuperValu, Kroger, Toys "R" Us, Best Buy, CVS, Borders, Lowe's, Caribou Coffee, and Marquis Healthcare.

The Unicru assessment consists of a number of statements, to which an applicant must answer “strongly disagree,” “disagree,” “agree,” or “strongly agree.” It includes statements such as the following: “You have confidence in yourself”; You are always cheerful”; “You try to sense what others are thinking and feeling”; “You always say whatever is on your mind”; and “It is easy for you to feel what others are feeling.”

Kroger, Kronos and the Unicru assessment are being investigated by the Equal Employment Opportunity Commission (EEOC) for compliance with labor and employment laws, including the Americans with Disabilities Act (ADA). The investigation has been ongoing for more than five years and has generated a number of district court and appellate court decisions as Kronos has sought to avoid disclosing information about the Unicru assessment and its impact on persons protected by the ADA.

Cloning Employees and Institutionalizing Biased Hiring Practices

According to Kronos, the Unicru assessment is an artificial intelligence test that uses neural networks to “learn” the characteristics of a customer’s “best” employees.  As stated by Kronos’ Chief Scientist and the developer of the Unicru assessment, Dr. David Scarborough, in chillingly Orwellian terms, "[o]ur system allows you to clone your best, most reliable people."

First used for engineering and industrial applications during the mid-1980s, neural networks evolved from early artificial intelligence research. Modeled on the function of the human brain, a neural network attempts to imitate human reasoning. Large amounts of data are fed into the network, which looks for relationships and reaches conclusions.

"There are a couple of dangers," states Jai Shekhawat, CEO of Chicago-based Fieldglass Inc., which develops software for managing workers. "Is something a correlation--a predictor--or merely a coincidence? At best, [these methods] are complementary to human judgment, not a substitute for it."

Notwithstanding such dangers, Kronos customers like Kroger are substituting this “coincidence” for human judgment. Based on the prospective employee's answers on the application, the Unicru assessment categorizes the applicant as red, green or yellow. In most cases, red is usually an automatic discard, or, as Dr. Scarborough stated “[m]anagers are strongly discouraged from hiring first quartile (“red”) applicants …”

There is no evidence that the Unicru assessment determines whether an employer’s hiring practices are biased or discriminatory. For example, if the Unicru assessment had been utilized fifty years ago, many companies’ “best” employees would have the personality traits of white males – persons of color, women and those with disabilities need not have applied.

The Unicru assessment embeds and industrializes existing stigma, bias and discrimination in the hiring process. As stated by Cynthia Dwork and Deirdre K. Mulligan in a recent Stanford Law Review article:

While automated decisionmaking systems “may reduce the impact of biased individuals, they may also normalize the far more massive impacts of system-level biases and blind spots.” Rooting out biases and blind spots in big data depends on our ability to constrain, understand, and test the systems that use such data to shape information, experiences, and opportunities.

As a “blind” tool that “learns” from the employer, the Unicru assessment replicates the existing bias of the employer and applies it on a massive scale. All applicants have their test responses fed through a discriminatory filter that is the Unicru assessment (a filter that is biased both on its own and in conjunction with its “learned” behavior). Hiring decisions are being made by Kroger and other Kronos customers based on this deeply flawed process.

Illegal Medical Examination

The ADA prohibits the use of pre-employment medical examinations. At the pre-offer stage, an employer, like Kroger, is only entitled to ask about an applicant's ability to perform the essential functions of the job. The ADA's prohibition against pre-employment examinations seeks to ensure that the applicant's disability is not considered prior to the assessment of the applicant's qualifications.

EEOC guidance provides a seven-factor test for analyzing whether a test or procedure qualifies as a “medical examination,” including:

• whether the test is designed to reveal an impairment of physical or mental health such as those listed in the Diagnostic and Statistical Manual of Mental Disorders (“DSM”); and
• whether the test is interpreted by a health care professional.

According to the guidance, the presence of any one of the seven factors is enough to support a finding that the test is a medical examination and the Unicru assessment meets the two factors listed above. 

Since the Unicru assessment is based on the five-factor model (FFM) of personality it meets the first factor listed above. As set out in previous posts -  ADA, FFM and DSM and Employment Assessments are Designed to Reveal an Impairment - assessments based on the FFM are designed to reveal an impairment of mental health, such as those listed in the DSM.

As to the second factor, whether the test is interpreted by a health care professional, the individuals who developed the Unicru assessment are psychologists, most of whom are members of the APA. In developing the Assessments, the psychologists establish the rules by which the assessments are to be interpreted (i.e., how the responses to the questions are to be scored, including whether the applicant receives a green, yellow or red rating).

According to the APA Model Act for State Licensure of Psychologists, “[t]he practice of psychology includes … (a) psychological testing and the evaluation or assessment of personal characteristics, such as intelligence; personality; cognitive, physical, and/or emotional abilities; … [and] (f) provision of direct services to … groups for the purpose of enhancing … organizational effectiveness, using psychological principles, methods, and/or procedures … for making decisions about the individual, such as selection …”

EEOC guidance states that psychologists are among the “variety of health professionals [that] may provide documentation regarding psychiatric disabilities” for ADA purposes. Accordingly, the psychologists who developed the Unicru assessment are "health care providers" for purposes of the ADA.

(Not) Walking the Talk

Kroger's Policy on Business Ethics states:

We are committed to a policy of equal opportunity for all associates without regard to race, color, religion, gender, national origin, age, disability or sexual orientation.

Kroger has six core values: Honesty; Integrity, Respect; Diversity; Safety; and, Inclusion. In a June 13, 2011 press release announcing the appointment of Kroger's chief diversity officer, Kroger's CEO is quoted as saying:

“Diversity is a core value at Kroger. We take our commitment to diversity seriously, both because it is right and because it makes us better at our business. When our decision-making is inclusive and reflects the diversity of our customers, we make better decisions.”

For job applicants with mental illness, there is no respect, no inclusion, no diversity, no honesty and no integrity. In the more than twenty years since passage of the ADA, there has been little positive movement in de-stigmatizing mental illness in the workplace (please see Mental Illness and Issues of Employment). People with mental illnesses identify employment discrimination as one of their most frequent stigma experiences. In its use of the Unicru assessment, Kroger, wittingly or not, continues the disturbing pattern of employment discrimination against citizens of the United States with mental illness.

Failing Customers and Shareowners

Kroger's Policy on Business Ethics also states:

As a retailer providing millions of Americans with their daily food and as a publicly owned company, The Kroger Co. has a special obligation to comply with the law and deal ethically with customers, suppliers, associates, and shareowners. 

Psychiatric medications are among the most widely prescribed and biggest-selling class of drugs in the U.S. In 2011, Americans spent $18.2 billion on antipsychotics to treat depression, bipolar disorder and schizophrenia, $11.0 billion on antidepressants and $7.9 billion on treatment for ADHD, according to IMS Health, which tracks prescription-drug sales. These three categories of prescription drug sales accounted for approximately 11.6% of all prescription drug sales in the U.S. for 2011

Kroger is the fifth-largest pharmacy operator in the United States, operating retail pharmacies in over 1,948 stores. During fiscal 2011, Kroger pharmacists filled over 146 million prescriptions at a retail value of approximately $7.3 billion. Assuming 11.6% of Kroger prescription drug sales were for antipsychotics, antidepressants and ADHD medications, prescription drugs for persons with mental illness accounted for approximately $847 million of Kroger prescription drug sales in 2011, some two-thirds of the amount of Kroger’s operating profit for that year.

Persons who have their prescriptions filled at Kroger, their family members and other loved ones also shop at Kroger for other products and services. Those persons, their family members and other loved ones provide a material percentage of Kroger’s overall revenue each year. How does Kroger repay this customer loyalty? By utilizing an unlawful pre-employment assessment to eliminate from consideration for employment persons with mental illness.

Why should persons with mental illness, their family members and other loved ones continue to shop at Kroger? Good question. 

Kroger's continuing use of the Unicru assessments calls into question Kroger's "special obligation to comply with the law and deal ethically" with its shareowners, As previously noted, Kroger and Kronos have been engaged in litigation with the EEOC for more than five years over legality of the Unicru assessment. To be precise, the five years of litigation have primarily addressed the unwillingness of Kroger and Kronos to provide information requested by the EEOC in order to conduct its investigation into the Unicru assessment. Two appellate courts, the latest in September 2012, have ruled decisively in favor of the EEOC and its right to investigate a broad set of nationwide and historical data from Kroger and Kronos.

At anytime over the past five years, Kroger could have ceased using the Unicru assessment, if only as a risk mitigation strategy for its shareowners. As noted in the Challenges to Pre-Employment Assessments posting, in July 2011, CVS and the Rhode Island Civil Liberties Union (ACLU) entered into a voluntary settlement addressing the ACLU’s complaint challenging CVS’s use of a pre-hire questionnaire that the ACLU claimed could have a discriminatory impact on people with certain mental impairments or disorders. Pursuant to the settlement agreement, CVS agreed to permanently remove the questions at issue from its online application.

Each day Kroger continues to use the Unicru assessment, there are thousands more potential plaintiffs with claims against Kroger. By now, the aggregate number of potential plaintiffs numbers in the millions - with each job applicant over the past 5+ years having a number of claims against Kroger.

Under the ADA, Kroger may use a third party like Kronos to undertake the assessment of Kroger job applicants. The use of a third party, however, does not insulate Kroger from any claims arising from the assessment usage. Under the ADA, Kroger is responsible (and liable) for any failures on the part of Kronos and the Unicru assessment to comply with the provisions of the ADA.

Any comfort Kroger or its shareowners take in the indemnification provided by Kronos should be tempered by the recognition that such indemnification may prove illusory. Kronos and its insurers may not have the capital necessary to indemnify Kroger and its shareowners for all claims arising from Kroger's continuing use of the Unicru assessment. Please see Damages and Indemnification Challenges for Employers.

What Are the Issues?

When people apply for a job online these days, they are increasingly being asked to take personality tests even before they exchange an e-mail or have a phone interview with a hiring manager. Such tests are being used by companies as a way to prune the job applications they receive.

The problem is that these assessments may also be used to illegally screen out job seekers with mental disabilities. 

As a result, too many people living with mental disabilities that are willing and able to work remain unemployed or underemployed. Not only does the United States economy experience the indirect loss in productivity and tax revenue arising from the unemployment and underemployment of persons with mental disabilities, there is a direct, rising and material cost to the U.S. Treasury associated with income support payments, like Social Security Disability Insurance and Supplementary Support Income. (Please see the post Costing Taxpayers Billions of Dollars Each Year).

Who are these persons with mental disabilities?

They are our sons and daughters, our mothers and fathers, our friends and colleagues. Mental illness is no respecter of age, race, gender, faith, sexual orientation, occupation, social position, education or wealth. Anyone can develop a mental illness.

They are:

• A soldier returning from Afghanistan looking to enter the civilian workforce, who suffers from PTSD as a result of combat
• A mother of a young child looking to support her family, who is recovering from post-partum depression
• A recent college graduate looking to start his career, who has been diagnosed with bipolar disorder

They are us. An estimated 26.2% of Americans ages 18 and older - about one in four adults - suffer from a diagnosable mental disorder in a given year.

At some point during his or her lifetime, the average American adult has a 28.8% chance of developing an anxiety disorders, a 24.8% chance of developing an impulse-control order, and a 20.8% chance of developing a mood disorder.

How widespread is pre-employment testing?

There are hundreds of companies that offer pre-employment assessments and/or implementation services to employers. One of the larger assessment companies, Kenexa (recently acquired by IBM) assesses more than 20 million persons a year. Other large assessment companies include Kronos (through its acquisition of Unicru), Oracle (through its acquisition of Taleo), SAP (through its acquisition of Success Factors) and SHL.

A mid-sized company in the retail business may have 50,000 assessments per month or 600,000 per year. Large “big box” employers and fast food companies may have 1-2 million assessments per year. 

Personality tests are “growing like wildfire,” said Josh Bersin, president and CEO of Bersin & Associates, an Oakland, Calif., research firm. Bersin estimated that this kind of pre-hire testing has been growing by as much as 20 percent annually in the past few years. Industries that are flooded with resumes such as retail, food service and hospitality are among the ones that use such tests most often, he said.

“A lot of work has been done over the years on how personality tests impact gender, race or age bias, but I don’t know if anyone has done enough research yet on mental disabilities,” says Bersin, “the medical community is starting to redefine what these diagnoses are, and the laws may not have caught up.”

Are pre-employment assessments legal?

The policy of the Equal Employment Opportunity Commission (EEOC) is that pre-employment testing, including personality testing, is acceptable as long as the test is not a "medical examination" as defined by the Americans with Disabilities Act (ADA).

EEOC guidance provides a seven-factor test for analyzing whether a test or procedure qualifies as a “medical examination,” including whether the test is designed to reveal an impairment of physical or mental health such as those listed in the Diagnostic and Statistical Manual of Mental Disorders (DSM).

According to the guidance, the presence of any one of the seven factors is enough to support a finding that the test is a medical examination. 

How do the assessments screen out persons with mental disabilities?

A key component of the assessment process is a computer-administered personality test based on the five factor model of personality, or FFM, a coordinate system that maps which personality traits go together in people’s descriptions or ratings of one another. the FFM describes personality in terms of five broad factors:

• Openness: inventive and curious vs. consistent and cautious. 
• Conscientiousness: efficient and organized vs. easy-going and careless. 
• Extraversion: outgoing and energetic vs. solitary and reserved.
• Agreeableness: friendly and compassionate vs. cold and unkind
• Neuroticism: sensitive and nervous vs. secure and confident

The majority of personality disorders are characterized by significant positive relations with Neuroticism and significant negative relations with Extraversion, Agreeableness and Conscientiousness. Consequently, applicants who take the Assessment and have low scores on Openness, Conscientiousness, Extraversion and Agreeableness and high scores on Neuroticism are likely not to be offered employment (or even interviewed).

Based on an applicant’s responses to the online test, the assessment categorizes the applicant as red, green or yellow. In many cases, green gets an applicant an automatic follow-up interview. Red is usually an automatic discard.  A red or yellow score on the Assessment does not necessarily mean that an applicant has a mental disability, but a person who has a mental disability is likely to receive a red or yellow score on the assessment and will be denied consideration for employment.

Some have argued that assessments are designed to measure “normal” personalities and/or “stable” personality traits. That argument fails because, as a dimensional model, the FFM determines each applicant’s position along the axis of each of the five traits. Those five traits are the common measuring rod for all persons, including persons with mental disabilities. By its design and structure, an assessment based on the FFM measures all aspects of a personality, including both normal and abnormal personality traits.

For more information, please see the ADA, FFM and DSM post.

Are the tests designed to intentionally screen out persons with mental disabilities?

Perhaps.

One assessment company, Clearfit, lists “27.2 days/yr. lost productivity for depressed workers” as one of the impacts to employers if personality is not taken into account in the hiring process.

In any event, courts have held that the intent is irrelevant. What is relevant is that the use of the FFM as the basis of an assessment means that the assessment was designed to reveal mental impairments by identifying and rejecting those applicants who do not fall within the “green” parameters of the five traits. 

Are there any studies addressing the impact of assessment tests on persons with mental disabilities?

There has been no public disclosure of any studies addressing the impact of FFM-based assessments on persons with mental disabilities. One prominent assessment company, Kronos, has claimed in a court document, that there is “no known method … to ascertain adverse impact against the entire generic category of disabilities.” Kronos goes on to claim ”that “the diverse nature of disabilities (e.g., blindness, paraplegia, deafness, severe mental illness) makes an analysis of a selection device’s adverse impact on “people who have disabilities” impossible.” Such claims are unsupportable.

As stated in a 2004 article published by the the Journal of Rehabilitation Administration, “studies of sub-groups, such as individuals with mental illnesses or cognitive impairments could be conducted to determine the potential, and perhaps likelihood for, pre-employment test results unfairly penalizing these individuals in the employee selection and hiring stages …” 

Such studies are, in fact, mandated. In a 1975 decision, the Supreme Court addressed a case in which an employer implemented a test on the theory that a certain verbal intelligence was called for by the increasing sophistication of the plant’s operations. The Court held that a test should be validated on people as similar as possible to those to whom it will be administered. The Court further stated that differential studies should be conducted on minority groups wherever feasible.

Costing Taxpayers Billions of Dollars Each Year

The material increase in Social Security Disability Insurance (SSDI) and Social Security Insurance (SSI) awards over the past 2+ decades is due in part to a significant increase in the use of pre-employment assessments by employers that screen out persons with mental disabilities from employment consideration:

• SSDI and SSI beneficiary payments by the United States Treasury currently amount to more than $10 billion per month. [1]
• Applications for SSDI and SSI awards have increased from more than 1.2 million in 1999 to more than 2.8 million in 2010. [2]
• The “supply” of persons eligible to apply for SSDI and SSI awards may be defined by reference to the universe of unemployed (or underemployed) persons. [3] 
• Assessments utilize the five factor model (FFM) of personality. FFM is widely accepted as representing the higher-order structure of both normal and abnormal personality traits. FFM-based assessments are used to identify (or “screen in”) persons who are “normal” or “stable” and, as a consequence screen out persons with mental illness. (Please see the ADA, FFM and DSM post.)
• While assessments are based on the characteristics of the employer’s “preferred” employees for the relevant position, the small number of individuals with disabilities in the workforce means that the norming of pre-employment assessments was conducted with a biased sample of non-disabled workers. [4] 

As a consequence of employment assessment test usage, the characteristics of the pool of unemployed (and underemployed) persons do not mirror the characteristics of the broader population:

• In the broader population, approximately 1 in 17 adults in the United States has a serious mental illness. [5]
• Due to FFM-based assessment usage, persons with mental disabilities are “overrepresented” among the universe of unemployed persons – such universe consisting of persons eligible to apply for SSDI and SSI.

SSDI and SSI [6]

Improved treatment of mental illness makes it possible for individuals to participate in society, including the labor force. Nevertheless, diagnosis of a severe and persistent mental illness is often associated with downward economic mobility. For example, the estimated reduction in annual earnings related to mental disorders ranges from 9.5% to 25% for males and from 12% to 29% for females.

The SSDI and SSI programs provide monthly cash payments and medical benefits for individuals who meet the program requirements for mental illness. The chart below shows the number of SSDI and SSI beneficiaries aged 18–64 receiving benefits on the basis of disability as of December 2011. 

SSI is for low-income individuals who are over 65 years of age, blind, or disabled due to a disorder that prevents them from engaging in “substantial” work for at least 12 months or until death. To establish disability, there is a multi-stage screening process, requiring judgment calls about impairment and functioning. A minority of applicants are approved for disability benefits.

SSDI is a traditional social insurance program that replaces a portion of earnings when disability prevents “substantial gainful activity,” defined in 2013 as monthly earnings over $1,040. Only individuals who have contributed sufficiently to this program via payroll taxes can qualify for benefits. Given the early onset and inconsistent work history that accompany serious mental illness, few with mental illness qualify for full benefits. 

Mental Illness and Disability [7]

The prevalence of mental disorders in the U.S. population remained unchanged between 1990 and 2003. [8] In that same interval, the rate of treatment of mental illness substantially increased—which in turn should have contributed to improved work-readiness among individuals coping with mental illness. The combination of the prevalence of mental disorders remaining unchanged and substantially increased rates of treatment should have resulted in a decline in the percentage of persons receiving SSDI awards who are diagnosed with mental illness. [9] That has not been the case.

People with psychiatric impairments constitute the largest and most rapidly growing subgroup of Social Security disability beneficiaries. In 2011, 47.5 percent of persons receiving SSI and 31.0 percent of persons receiving SSDI had a mental disorder. [10] These percentages keep growing, in part because beneficiaries with psychiatric impairments are generally younger than other beneficiaries when they become ill and therefore remain on the Social Security rolls much longer.

Increased SSDI and SSI Awards: Policy Success or Failure?[11]

Income support programs like SSDI and SSI may create a disincentive to work, called moral hazard. Some analysts contend that rising disability awards for mental illness reflect a “broken” system that provides benefits to those who should not receive them; others point out that income support makes it easier for persons with mental illness to live in the community. These conflicting conclusions reflect an ongoing debate over whether increasing awards for mental illness represent a policy success because they reach needy individuals or failure because the increased awards reflect moral hazard.

The income support programs may be working as designed, but those programs did not anticipate the impact of the widespread use of pre-employment assessments and the resulting material increase in the absolute number and percentage of unemployed persons with mental disabilities seeking SSDI and SSI benefits as a consequence of the use of illegal assessments.

Rising Use of Personality Tests [12]

For more and more companies, the hiring boss is an algorithm. The factors they consider are different than what applicants have come to expect. Jobs that were once filled on the basis of work history and interviews are left to personality tests and data analysis, as employers aim for more than just a hunch that a person will do the job well.

Personality tests have a long history in hiring. What’s new is the scale. Powerful computers and more sophisticated software have made it possible to evaluate more candidates, amass more data and peer more deeply into applicants’ personal lives and interests.

The new hiring tools are part of a broader effort to gather and analyze employee data. Globally, spending on so-called talent-management software rose to $3.8 billion in 2011, up 15% from 2010, according to research firm Gartner. Big tech companies are jockeying to serve the growing market. In December 2012, IBM paid $1.3 billion for Kenexa Corp., which uses data analysis to help companies recruit and retain workers. Oracle Corp. acquired job-applicant tracking system company Taleo for $1.9 billion, and Germany’s SAP AG bought SuccessFactors, which specializes in performance tracking, recruiting and compensation, for $3.4 billion.

To date, assessments have been used primarily in the context of recruitment and hiring for entry-level positions. Assessments use is expanding, however, and is expanding to a variety of employment actions, including hiring, promotion, leadership development, training, retention, succession planning, workforce planning, analytics, outplacement, restructuring, and change management. [13] The possible “knock on” impacts of the broadening use of assessments includes the potential that existing employees, many of whom became employees prior to the widespread use of assessments in the hiring process, will find themselves unemployed and potentially looking to the SSDI and SSI programs for support.

Notes

[1] In December 2011, payments to disabled beneficiaries totaled about $10.4 billion according to the Annual Statistical Report on the Social Security Disability Insurance Program, 2011 (2011 Annual Statistical Report).

[2]Id. at Table 59.

[3] The replaces a portion of earnings when disability prevents “substantial gainful activity,” defined in 2013 as monthly earnings over $1,040.

[4] Hartigan, J. A., & Wigdor, A. K. (Eds.). (1989). Fairness in employment testing: Validity generalization, minority issues, and the General Aptitude Test Battery. Washington, D.C.: National Academy Press.

[5] It is also estimated that approximately 1 in 4 adults will have a mental health disorder in any given year (most commonly anxiety or depression); however, many of these disorders will not lead to a lasting disability. Reeves WC, Strine TW, Pratt LA, et al. Mental illness surveillance among adults in the United States. MMWR. 2011; 60(3):1–32. Atlanta, GA: Centers for Disease Control and Prevention. Available from CDC Mental Illness Surveillance Report

[6] This subsection is taken, in part, from Sheldon Danziger, Richard G. Frank, Ellen Meara; Mental Illness, Work, and Income Support Programs, Am J Psychiatry 2009;166:398-404. 10.1176/appi.ajp.2008.08020297 (hereinafter, Mental Illness, Work, and Income Support Programs).

[7] Except for the first paragraph, which is attributable to the publication cited in footnote 4, and the quote associated with footnote 11, this subsection is taken from Robert E. Drake, Jonathan S. Skinner, Gary R. Bond and Howard H. Goldman, Social Security And Mental Illness: Reducing Disability With Supported Employment, Health Affairs, 28, no.3 (2009):761-770. Citations contained in that publication have been omitted from the excerpts above.

[8] RC Kessler, O Demler, RG Frank, M Olfson, HA Pincus, EE Walters, P Wang, ZB Wells and AM Zaslavsky, “Prevalence and Treatment of Mental Disorders, 1990 to 2003,” New England Journal of Medicine 352 (2005): 2515–23.

[9]Id. at 6-7.

[10] These numbers differ from the excerpted article as a consequence of taking updated information from Table 68 in the 2011 Annual Statistical Report. The percentages for SSI and SSDI recipients, as set out above, do not include persons with intellectual disabilities (previously listed under the heading of mental retardation).

[11] The first paragraph of this subsection is taken from Mental Illness, Work, and Income Support Programs.

[12] Other than the final two paragraphs, this subsection is taken from Meet the New Boss: Big Data, Joseph Walker (Wall Street Journal, September 20, 2012).

[13]SHL 2013 Global Assessment Trends, S. Fallaw and T. Kantrowitz

ADA, FFM and DSM

ADA and Restrictions on Medical Examinations

When Congress enacted the ADA in 1990, it found that people with disabilities have been “subjected to a history of purposeful unequal treatment” in many areas including employment.   

The ADA strictly prohibits certain inquiries and examinations.  Title I of the ADA bars employers from questioning about the existence, nature or severity of a disability and prohibits medical examinations until after a conditional offer of employment has been made. Courts have held that medical examinations include psychological tests. 

EEOC Enforcement Guidance

EEOC enforcement guidance provides a seven-factor test for analyzing whether a test or procedure qualifies as a “medical examination,” including:

• whether the test is designed to reveal an impairment of physical or mental health such as those listed in the Diagnostic and Statistical Manual of Mental Disorders (“DSM”); and
•  whether the test is interpreted by a health care professional.

According to the guidance, the presence of any one of the seven factors is enough to support a finding that the test is a medical examination.

The Assessment and the Five-Factor Model

A key component of the Assessment process is a computer-administered personality test based on the five factor model (FFM), a coordinate system that maps which personality traits go together in people's descriptions or ratings of one another. The FFM is empirically-based, and its five factors were discovered through a statistical procedure called factor analysis.

As illustrated in the diagram to the right, the FFM describes personality in terms of five broad factors:

• Openness: inventive and curious vs. consistent and cautious. 
• Conscientiousness: efficient and organized vs. easy-going and careless.
• Extraversion: outgoing and energetic vs. solitary and reserved.
• Agreeableness: friendly and compassionate vs. cold and unkind
• Neuroticism:sensitive and nervous vs. secure and confident

Dimensional vs. Categorical Taxonomy

The FFM is a "dimensional" taxonomy consisting of a profile of a diagnosis in terms of a few relevant and empirically-validated traits (e.g., the five factors).  The model is based on the idea that a mental disorder itself is not a categorical construct but rather a unique and meaningful constellation of traits.

As illustrated in the table at left, each of the five factors is viewed on a dimensional basis, with personality determined by positioning along each of the five axes of Openness, Conscientiousness, Extraversion, Agreeableness and Neuroticism.

Previous versions of the DSM, like the DSM-IV-TR, were based on the "categorical" model. The categorical model is based on a model of diagnosis in which a patient’s symptoms add up to a diagnosis which subsequently leads to a treatment that addresses the disorder. Research and practice have found that psychological disorders do not lend themselves well to the categorical model due to their eclectic and variable nature.

FFM and DSM

The shortcomings of the categorical model led the APA to adopt the FFM in the DSM-5 for purposes of diagnosing personality disorders. The adoption of the FFM in the DSM-5 follows approximately two decades of research demonstrating that the FFM can be used as a structural model for describing and understanding personality disorders, including those within the DSM.

In her seminal review of the personality disorder literature published in 2007, Dr. Lee Anna Clark, one of eleven members of the working group on personality disorders for DSM-5, stated that “the five-factor model of personality is widely accepted as representing the higher-order structure of both normal and abnormal personality traits.”  

A study entitled, "The Convergent Structure of DSM-5 Personality Trait Facets and Five-Factor Model Trait Domains," published in September 2012 and co-authored by another member of the DSM-5 personality disorder working group, states:

• "[T]his study builds on a growing body of research indicating correspondence between the DSM-5 personality trait model and the FFM [citations omitted] by showing that common higher-order dimensions can be identified in a conjoint analysis of FFM and DSM-5 traits."
• "[T]he structure of maladaptive traits proposed for DSM-5 bears clear resemblance to the structure of normal personality as represented by the [FFM]."
• "The … FFM is capable of linking normal personality traits with disordered personality features."

A December 2012 article entitled “The Five-Factor Model of Personality Disorder and DSM-5” states that “studies have consistently demonstrated significant relations between the traits included in the FFM and the DSM [personality disorder] constructs. The article also sets out the following table showing the correlation between FFM domain factors and DSM-5 traits:

The Assessment is Designed to Reveal An Impairment

As noted, EEOC  guidance provides that tests or assessments are medical examinations if they provide evidence that would lead to identifying a mental disorder or impairment, such as those listed in the DSM.

The majority of personality disorders, including those listed in the DSM, are characterized by significant positive relations with Neuroticism and significant negative relations with Extraversion, Agreeableness and Conscientiousness. Consequently, applicants who take the Assessment and have low scores on Openness, Conscientiousness, Extraversion and Agreeableness and high scores on Neuroticism, will be categorized as red.

The chart at left  illustrates the application of the FFM dimensional-based process used by the Assessment.  Based on an applicant’s responses to the online test, the Assessment categorizes the applicant as red, green or yellow. In many cases, green gets an applicant an automatic follow-up interview. Red is usually an automatic discard. 

Employers and assessment providers have tried to argue that their assessments are designed to measure “normal” personalities and/or “stable” personality traits. That argument fails because, as a dimensional model, the FFM determines each applicant’s position along the axis of each of the five traits. Those five traits are the common measuring rod for all persons, including persons with mental disabilities. By its design and structure, an Assessment based on the FFM cannot measure only so-called “normal” personalities.

While the intent of the Assessment design may not have been to reveal a mental impairment, courts have held that the intent is irrelevant. What is relevant is that the use of the FFM as the basis of the Assessment means that the Assessment was designed to reveal mental impairments by identifying and rejecting those applicants who do not fall within the “green” parameters of the five traits.