OFCCP Issues Final Rule Defining "Internet Applicant"

On October 7, 2005, the U.S. Department of Labor's Office of Federal Contract Compliance Programs (OFCCP) published a final rule providing the long-awaited definition of "Internet Applicant." 70 Fed. Reg. at 58,946 (Oct. 7, 2005). The rule will go into effect on February 6, 2006, 120 days after its publication.

The OFCCP final rule clarifies whether a particular job seeker is an applicant for purposes of record-keeping requirements when the individual expresses interest in a job position through the Internet and related electronic data technologies, such as email, resume databases and online job banks. Significantly, the rule sets forth four criteria that an individual must satisfy in order to be considered an Internet Applicant. Federal contractors must obtain gender, race and ethnicity data on individuals who fulfill this four-part definition.

Criteria Used to Determine if an Individual Is an "Internet Applicant"
The OFCCP enforces legal authorities that prohibit federal contractors from discriminating on the basis of race, color, sex and national origin. To enforce non-discrimination and affirmative action mandates, the OFCCP requires covered federal contractors to collect gender, race and ethnicity data on employees and applicants.

Before promulgation of the final rule, contractors had little guidance in determining which individuals should be considered applicants for purposes of collecting data, especially in the context of the growing number of individuals utilizing the Internet. In an effort to address the ambiguity, the OFCCP created a four-part definition of Internet Applicant.

Under the new definition, an individual must satisfy the following four criteria to be considered an Internet Applicant:

1. The individual submits an expression of interest in employment through the Internet or related electronic data technologies.
2. The contractor considers the individual for employment in a particular position.
3. The individual's expression of interest indicates the individual possesses the basic qualifications for the position.
4. The individual at no point in the contractor's selection process, prior to receiving an offer of employment from the contractor, removes himself or herself from further consideration or otherwise indicates that he or she is no longer interested in the position.
   70 Fed. Reg. at 58,961.

Submits Expression of Interest Through Internet or Related Technologies
Although several commenters requested that the OFCCP elaborate on the term "Internet or related electronic data technologies," the OFCCP indicated that it would not provide a precise definition of this term because the technology in this area is constantly evolving. 70 Fed. Reg. at 58,951. The OFCCP did, however, list types of technologies included within the term "Internet or related electronic data technologies," namely email, internal and third-party resume databases, job banks, electronic scanning technology, applicant tracking systems, applicant service providers and applicant screeners. Id.

A number of commenters expressed concern that contractors accepting expressions of interest through traditional means, such as paper resumes and walk-in job applications, as well as through Internet and related technological means, would be burdened with two different data pools. 70 Fed. Reg. at 58,948-49. In response to these concerns, the final rule allows contractors to apply the Internet Applicant criteria to expressions of interest submitted through traditional methods of application, if the contractor considers both electronic and traditional expressions of interest for that position. 70 Fed. Reg. at 58,961.

To clarify this aspect of the rule, the OFCCP provides a series of examples:

Example A:

• Contractor posts an opening for a position on its website and encourages potential applicants to complete an online profile to express interest in the position.
• Contractor advises potential applicants on the website that they can also mail a hard-copy resume with cover letter.
• Internet Applicant rule applies to both online profiles and hard-copy resumes.

Example B:

• Contractor posts an opening for a position on its website and encourages potential applicants to complete an online profile to express interest in the position.
• Contractor also receives a large number of unsolicited hard-copy resumes and scans them into an internal database, which includes the completed online profiles that the contractor uses to find potential applicants for the position posted on the website.
• Internet Applicant rule applies to both online profiles and unsolicited paper resumes.

Example C:

• Contractor advertises a position opening in a local newspaper and instructs interested candidates to mail hard-copy resumes.
• Contractor also considers walk-in applications for the position.
• Internet Applicant rule does not apply to hard-copy resumes and application forms.
  70 Fed. Reg. at 58,961-62.

Contractor Considers Individual for Employment in a Particular Position
The final rule specifies that a contractor "considers the individual for employment in a particular position" if the contractor "assesses the substantive information provided in the expression of interest with respect to any qualifications involved with a particular position." 70 Fed. Reg. at 58,962. The OFCCP makes clear that a contractor cannot evaluate an individual's qualifications for a position without thereby having "considered" the individual for the position. 70 Fed. Reg. at 58,950. By way of example, a contractor who receives expressions of interest from 50 individuals through the Internet or related technologies and looks at all 50 to determine which meet the basic qualifications for the position has "considered" all 50 job seekers.

The contractor's actual practice, however, will determine whether the contractor has considered an individual for employment in a particular position. For example, if a contractor's policy is to accept expressions of interest only through its website, but the contractor in practice reviews mailed or faxed paper resumes and scans them into an internal database, the contractor's actual practice is to consider mailed or faxed paper resumes as well as expressions of interest through the website. 70 Fed. Reg. at 58,950.

To reduce the number of expressions of interest that it considers, a contractor "may establish a protocol under which it refrains from considering:"

• "[E]xpressions of interest that are not submitted in accordance with standard procedures the contractor establishes."
• "[E]xpressions of interest, such as unsolicited resumes, that are not submitted with respect to a particular position."
  70 Fed. Reg. at 58,962.

However, if a contractor implements such procedures and policies to limit the number of considered expressions of interest, the contractor must "uniformly and consistently" apply the procedures and policies to similarly situated job seekers. 70 Fed. Reg. at 58,951. Again, a contractor's actual practice is determinative.

Additionally, a contractor can reduce the number of considered applicants "by using data management techniques that do not depend on assessment of qualifications." 70 Fed. Reg. at 58,962. Such techniques include random sampling, whereby the contractor considers only a small subset of resumes drawn at random, or absolute numerical limits, whereby the contractor reviews only a predesignated number of resumes, such as the first 50 resumes submitted. 70 Fed. Reg. at 58,951. The sample produced by such techniques, however, must be appropriate in terms of the pool of those submitting expressions of interest and must be facially neutral in terms of race, gender or ethnicity. Id.

The OFCCP recognized the burden faced by contractors that utilize technologies with a voluminous applicant pool. Specifically, the OFCCP discusses the example of a contractor that searches an Internet service, such as Monster.com, and finds more than 20,000 resumes of individuals who satisfy the basic qualifications for a position. 70 Fed. Reg. at 58,950. In response to this concern, the OFCCP noted than an employer can use data management techniques, such as random sampling or an absolute numerical technique, to ease its record-keeping burden. 70 Fed. Reg. at 58,950-51.

Expression of Interest Indicates Basic Qualifications for Position
Basic qualifications are those qualifications that a contractor advertises in advance to potential applicants that they must possess to be considered for the position. 70 Fed. Reg. at 58,962. Or, if the contractor does not advertise for the position but uses an alternative method to find individuals for consideration, basic qualifications are those qualifications for the position that a contractor makes and records prior to considering any expression of interest for that position. Id. Further, basic qualifications must be: (1) non-comparative, (2) objective and (3) "relevant to performance of the particular position and enable the contractor to accomplish business-related goals." Id.

A job seeker must meet all of a contractor's basic qualifications to be considered an Internet Applicant. 70 Fed. Reg. at 58,954. By way of example, if a contractor initially screens 100 job seekers for three basic qualifications, which narrows the pool to 75, and then adds a fourth basic qualification that results in a pool of 40, only the 40 job seekers meeting all four basic qualifications would be Internet Applicants, assuming they satisfy the remaining definition criteria. 70 Fed. Reg. at 58,954.

Non-Comparative: The OFCCP provides examples of qualifications that would and would not be non-comparative. 70 Fed. Reg. at 58,962. For instance, a basic qualification requiring three years' experience would qualify as non-comparative because a contractor can determine if an individual meets this requirement without evaluating other applicants. See id. However, "a qualification that an individual have one of the top five number of years' experience among a pool of job seekers is a comparative qualification." Id.

Objective: Qualifications must not "depend on the contractor's subjective judgment." 70 Fed. Reg. at 58,962. The rule also states that "[a] basic qualification is objective if a third-party, with the contractor's technical knowledge, would be able to evaluate whether the job seeker possesses the qualification without more information about the contractor's judgment." Id. The OFCCP illustrates the distinction between objective and subjective criteria by pointing out that "a Bachelor's degree in Accounting" is an objective qualification, while "a technical degree from a good school" is not. Id.

Individual Did Not Remove Himself from Further Consideration or Indicate Disinterest in Position
A contractor may conclude that an individual has removed himself or herself from the selection process or has otherwise indicated lack of interest in the position based on:

• The individual's express statement, including declining a contractor's invitation for a job interview or a job offer.
• The individual's passive demonstration of disinterest, including repeated non-responsiveness to a contractor's telephone or email inquiries about his or her interest in a position.
• The information provided in the expression of interest, including statements pertaining to the individual's interest in the specific position, preferences as to location of work or type of work or his or her salary requirements, if the contractor has a uniformly and consistently applied policy or procedure of not considering similarly situated job seekers.
  70 Fed. Reg. at 58,958 and 58,962.

Record Retention Requirements
Although contractors must collect gender, race and ethnicity data for individuals who qualify as Internet Applicants, they must also maintain records of expressions of interest made through the Internet or related electronic data technologies for all individuals "considered" by the contractor for a particular position. 70 Fed. Reg. at 58,962. Contractors do not have the burden of retaining all expressions of interest made through the Internet or related technologies, but only expressions of interest actually "considered." 70 Fed. Reg. at 58,958.

In response to the concerns articulated by commenters regarding record-keeping for the voluminous pool of applicants on external resume databases, such as Monster.com, the final rule slightly varies the record retention standard in the context of a third-party resume database. In this scenario, contractors are required "to retain resumes only of job seekers who met the basic qualifications for the particular position who are considered by the contractor, and records identifying job seekers contacted regarding their interest in a particular position." 70 Fed. Reg. at 58,959. Also, the contractor must retain a record of the position for which each search of the database was made, the substantive search criteria used, and the date of the search.Id.

With respect to internal resume databases, contractors "must maintain a record of each resume added to the database, a record of the date each resume was added to the database, the position for which each search of the database was made, and corresponding to each search, the substantive search criteria used and the date of the search." 70 Fed. Reg. at 58,962.

Conclusion
In light of the new policy guidance provided by the OFCCP, contractors should evaluate their current recruiting policies and procedures for considering job seekers before the final rule takes effect early next year. To minimize what could be a significant record-keeping requirement, contractors should also consider updating or establishing clear protocols that limit the number of individuals considered for a position, for example by utilizing data management techniques or excluding consideration of individuals who do not follow the proper channels for application submission.

The author acknowledges the assistance of WRF associate Maria L. Mullarkey.

For more information, please contact Brian Nuterangelo at 202.719.3172 or bnuterangelo@wileyrein.com.