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Wednesday, March 19, 2008

The ADA and Personality Testing – The 7th and 8th Circuit Split on the Permissibility of the MMPI in Pre-Offer of Employment Screening

by: Thomas Ritzert, Associate Editor, MTTLR

Image "Soul Searching" by *YourGuide.
Used under a Creative Commons BY-NC-ND 2.0 license.
In 2006, 46 percent of US employers drew from a pool of over 8,000 different psychological and personality tests for use in screening job applicants.1 In fact, psychological testing in the hiring process has become so prevalent that testing firms now comprise a $400 million industry; a single test, the Myers-Briggs Type Indicator, is administered to over 2.5 million people per year.2 Many employers offer jobs in more than one jurisdiction and use these tests as part of an online application process, accessible by any job seeker with an internet connection.3 Internet-based testing is a risky move for employers, because although a broad array of federal and state regulations protect job applicants from certain inquiries, there is uncertainty as to the precise requirements of these regulations, what tests can be used by employers, and who has standing to challenge the testing.4

One example of this uncertainty is the current split between the Seventh and Eighth Circuits on the proper application of the Americans with Disabilities Act’s (ADA) prohibition of pre-offer medical examinations5 in the context of personality and psychological testing, particularly tests based on the Minnesota Multiphasic Personality Inventory (MMPI). This post focuses on the limitations that the ADA imposes on such testing, and concludes that the Seventh Circuit’s approach to the issue in Karraker v. Rent-a-Center (holding that the MMPI and tests based on questions from the MMPI are medical examinations prohibited in the pre-offer stage of the hiring process) is the correct application of the statute.

The ADA’s Prohibition of Pre-Offer Medical Examinations

The principal purpose of the ADA is “to provide a clear and comprehensive national mandate for the elimination of discrimination against individuals with disabilities” and to “provide clear, strong, consistent, enforceable standards” addressing such discrimination.6 The ADA defines individuals with disabilities as persons who 1) have a “physical or mental impairment that substantially limits one or more” major life activities; 2) “have a record of such impairment”; or 3) are “regarded as having such impairment.”7 Title I of the ADA covers employment discrimination, and one protection that Congress has created for individuals with disabilities is the right to be free from pre-offer medical examinations in the hiring process.8

Specifically, the Act provides that “a covered entity shall not conduct a medical examination or make inquiries of a job applicant as to whether such applicant is an individual with a disability or as to the nature or severity of such disability.”9 However, an employer may “make preemployment inquiries into the ability of an applicant to perform job related functions”10 and may also “require a medical examination after an offer of employment has been made to a job applicant and prior to the commencement of the employment duties of such applicant, and may condition an offer of employment on the results of such examination11 so long as: 1) “all entering employees are subjected to such an examination regardless of disability”,12; 2) the “information obtained regarding the medical condition or history of the applicant”13 is kept confidential; and 3) the “examination or inquiry is shown to be job-related and consistent with business necessity.”14

In short, the rule is that while an employer may ask an applicant certain basic questions to find out how the applicant will be able to perform job related functions, an employer may not subject job applicants to pre-offer medical testing. They may, however, condition the job offer upon satisfactory results from a post-offer examination so long as certain conditions of fairness and confidentiality are met. Although this rule seems straightforward enough, there is disagreement over the meaning of the term “medical examination.”15

The Eighth Circuit Approach

In 1990, Robin Miller, who had been a police officer for 10 years in Texas, applied for a position as a police officer with the city of Springfield, Missouri.16 The city required all police recruits to pass two tests before extending an offer of employment – an agility test and the MMPI-2.17 Between 1990 and 1993, Miller applied for a job with the police department three times but was rejected on the first two occasions for failing the agility test.18 Miller successfully completed the agility test in her third application but ran into trouble with the MMPI-2.19 Miller’s test results indicated “above-normal depression” and Springfield declined to extend an offer as a result.20

Miller responded by suing the city for violating the ADA by subjecting her to the MMPI-2 in the application process.21 In a very brief decision, the Eighth Circuit severely limited the effect of the ADA’s ban on pre-offer medical examinations. The court cited EEOC guidelines interpreting the ADA’s rule for post-offer medical examinations, specifically the provision that “if certain criteria are used to screen-out an employee or employees with disabilities as a result of such an examination or inquiry, the exclusionary criteria must be job-related and consistent with business necessity….”22 Relying on this guideline, the court wrote “we easily conclude that appropriate psychological screening is job-related and consistent with business necessity where the selection of individuals to train for the position of police officer is concerned.”23 Furthermore, the court held that regardless of whether Miller was actually screened out by a test issued in violation of the ADA, she was not in fact disabled, and therefore had no standing to challenge the pre-employment screening under the ADA.24

There is no question that the ADA allows employers to “require a medical examination after an offer of employment has been made to a job applicant and prior to the commencement of the employment duties of such applicant, and may condition an offer of employment on the results of such examination.”25 However, it also clearly bans such screening before an offer is made.26 The Miller decision passes over the ADA’s ban on pre-offer medical examinations and, at least in the context of police hiring, treats a pre-offer examination as if it were a post-offer test.

One explanation for the Eighth Circuit’s holding is that the court simply saw no practical reason for the distinction between pre-offer and post-offer testing under the ADA since unsatisfactory results in either case will result in a rejection of employment. Indeed, the fact that the court applied only two sentences of analysis to Miller’s claim that use of the MMPI in her application violated the ADA suggests that it was basing its decision more on the obvious conclusion that cities need to screen out mentally unstable police recruits than on the actual timeline and procedure for such screening mandated by the ADA. While from a practical standpoint this may be true, it is not the law passed by Congress. In another case concerning police officer application procedures, the Federal District Court for the Southern District of Florida held that pre-offer examinations were barred by the ADA even in the law enforcement sector.27 Acknowledging the need to have mentally stable law enforcement officials, the court held that “on this issue, however, the statute is clear… the ADA prohibits pre-offer ‘medical examinations.’”28 The court refuted the type of line-blurring between pre-offer and post-offer regulations found in Miller, noting that:
While the pre/post employment medical examination distinction may seem pointless, it actually serves several important functions. First, it allows an applicant to demonstrate that he has the necessary job qualifications without regard to any disability; second, by permitting the examination to take place only after an offer of employment is made, it forces employers to demonstrate that their reason for not hiring an applicant is job related, or a business necessity; third, this scheme requires an employer to make an effort to reasonably accommodate an applicant’s disability.29

This explanation of the reasons for the pre-offer ban illustrate why the court’s approach in Miller is inconsistent with the rules Congress intended to enact in the ADA. Congress did not create separate rules for pre-offer and post-offer screening for no reason or unknowingly, and the pre-offer rules should be enforced.

The Seventh Circuit Approach

Christopher, Steven and Michael Karraker were brothers working for Rent-A-Center (RAC), a chain of stores offering rent-to-own deals on furniture and household appliances.30 Each of the brothers wanted to move up the chain-of-command at the store,31 and progress from their positions as floor salesmen to middle management.32 In order to do so, however, they had to take RAC’s “APT Management Trainee-Executive Profile,” an assessment comprised of nine tests covering math, language, interests, and personality.33 The APT Test also included 502 questions from the MMPI, and the brothers were asked to respond true or false to such prompts as “I see things or animals or people around me that others do not see”; “I commonly hear voices without knowing where they are coming from”; “At times I have fits of laughing and crying that I cannot control”; “My soul sometimes leaves my body”; “At one or more times in my life I felt that someone was making me do things by hypnotizing me”; and “I have a habit of counting things that are not important such as bulbs on electric signs, and so forth.”34 After all three brothers failed to score satisfactorily on the APT Test, they filed a class action lawsuit against RAC on behalf of other employees at 106 RAC stores, claiming that the store’s APT Test constituted a violation of the ADA’s prohibition of pre-offer medical examinations.35

The Seventh Circuit began its analysis by noting that Congress has explicitly limited “the ability of employers to use ‘medical examinations and inquiries’” in three provisions, namely “a prohibition against using pre-employment medical tests; a prohibition against the use of medical tests that lack job-relatedness and business necessity; and a prohibition against the use of tests which screen out (or tend to screen out) people with disabilities.”36 The court then looked to seven EEOC guidelines37 on what counts as a medical examination, holding that whereas the presence of only one of those factors may be enough to make a test prohibited under the ADA,38 the absence of one or more factors will not determinatively demonstrate that the test is not a medical examination.39 Instead, the key inquiry is whether the test in question is “designed to reveal a mental impairment.”40

Applying the new test to the facts in Karraker, the court held that regardless of whether RAC actually used the test to weed out individuals with certain disorders, the “use of the MMPI likely had the effect of excluding employees with disorders from promotions.”41 Since the APT Test incorporated many questions from the MMPI, and the MMPI was designed to reveal mental illness, the APT Test had the effect of hurting the employment prospects individuals with a mental disability.42 In other words, the MMPI and other tests that are based on the MMPI are properly considered a medical examination under the ADA, and employers may not use them in the pre-offer stage of the hiring process.43


With a mobile workforce and increasing reliance on online application processes, modern employers are often faced with the prospect of hiring applicants about whom they know very little. The applicant’s previous employers are increasingly unlikely to provide references of any real use, and in fact are likely to produce no reference at all.44 In light of this trend it is easy to see why employers are attracted to the prospect of personality testing. Particularly in an increasingly service sector-based economy, employers are loathe to present the public with sales staff who have some traits or conditions incompatible with good customer service.

Fortunately for employers, the ADA’s prohibition of pre-offer medical examinations does not take personality and psychological screening completely off the table. It merely requires that, in addition to some showing of job relatedness and business necessity, such screening come after a job offer is made. The ADA even allows the employer to condition the job offer upon successful completion of the examination. In short, the regulations allow for an appropriate balance of the ADA’s goal of preventing applicants from being screened out from the start based on a medical examination that exposes the applicant’s disability and the employer’s need to hire a suitable workforce.

Decisions like Miller distort this balance by blurring the boundaries of the ADA’s pre-offer and post-offer examination regulations. In holding the MMPI a prohibited pre-offer medical examination under the ADA, the Seventh Circuit approach in Karraker recognizes the proper distinction between pre-offer and post-offer testing. The Karraker test offers a practical method for determining whether a test violates the ADA by focusing on whether the test was designed to reveal mental impairments or whether it has the effect of excluding applicants from hire or promotion based on mental disorders. To avoid potential liability for violating the ADA, employers should keep the Karraker test in mind when choosing pre-offer personality screens and, at a minimum, avoid tests that incorporate sections of the MMPI and other examinations designed to detect mental disorders. Given the uncertainty as to whether other circuits will adopt the broad standing requirements and medical examination test announced in Karraker or follow the rigid standing guidelines and substitution of post-offer rules for pre-offer tests found in Miller, employers hiring in multiple jurisdictions or that feature the personality screen as part of an online application should be particularly careful in choosing which tests to use.

1 Jennifer Gonzales-Frisbie, Comment, Personality Tests in Jeopardy: An Evaluation of the Seventh Circuit’s Decision in Karraker v. Rent-A-Center and its Impact on the Future Use of Personality Tests in Pre-Employment Screening, 9 U. Pa. J. Lab. & Emp. L. 185, 190 (Fall 2006).
2 Larry R. Seegull and Emily J. Caputo, When a Test Turns into a Trial: Things to Keep in Mind about Psychological Testing, 15 Bus. L. Today 13 (January/February 2006).
3 See, e.g., eTest.net, FAQs (last visited Mar. 18, 2008)(explaining that “[testing remote applicants is] the beauty of online testing. You can have a candidate located anywhere in the world with Internet access take the test and the results will come directly to you.”)
4 See, e.g., L. Camille Hebert, American with Disabilities Act of 1990, 1 Empl. Privacy Law § 7:16 (2007) (noting the split among circuits as to whether a person must be an individual with a qualifying disability to challenge pre-offer employment screening through medical examinations, and finding that whereas the 6th Circuit in Bone v. Louisville, 215 F.3d 1325 (2000) held that an individual must be disabled under the ADA to bring a claim against employer testing under 42 U.S.C.A. § 12112(d)(2), the 8th, 9th, and 10th Circuits have rejected this conclusion, and would allow an individual to challenge a pre-offer medical examination under the statute regardless of whether such individual had a qualifying disability).
5 42 U.S.C. § 12112(d).
6 42 U.S.C. § 12101(b).
7 42 U.S.C. § 12102(d)(2).
8 42 U.S.C. § 12112(d).
9 42 U.S.C. § 12112(d)(2)(A).
10 42 U.S.C. § 12112(d)(2)(B).
11 42 U.S.C. § 12112(d)(3). Emphasis not in original.
12 42 U.S.C. § 12112(d)(3)(A).
13 42 U.S.C. § 12112(d)(3)(B).
14 42 U.S.C. § 12112(d)(3)(C)-(4)(A).
15 42 U.S.C. § 12112(d).
16 Miller v. City of Springfield, 146 F.3d 612 (8th Cir. 1998). Available publicly at http://cases.justia.com/us-court-of-appeals/F3/146/612/.
17 Id.
18 Id.
19 Id.
20 Id.
21 Id.
22 Id. at 615 (citing 29 C.F.R. § 1630.14(b)(3) available publicly at http://frwebgate.access.gpo.gov/cgi-bin/get-cfr.cgi?TITLE=29&PART=1630&SECTION=14&YEAR=2000&TYPE=TEXT.
23 Miller, at 615.
24 Id.
25 42 U.S.C. § 12112(d)(3). Emphasis not in the original.
26 42 U.S.C. § 12112(d)(2)(A).
27 Barnes v. Cochran, 944 F. Supp 897 (S.D. Fla. 1996).
28 Id.
29 Id., at FN 3, (citing Stacy J. Bagley, Enough is Enough! Congress and the Courts React to Employers' Medical Screening and Surveillance Procedures, 99 Dick. L. Rev. 723, 730-31 (1995)).
30 Karraker v. Rent-A-Center, 411 F.3d 831 (7th Cir. 2005). Available publicly at http://cases.justia.com/us-court-of-appeals/F3/411/831/
31 Even though this case concerned promotion, rather than an initial hiring decision, the court analyzed the case under the ADA’s pre-offer regulations because the applicants were seeking new positions within the company. Both parties agreed to this framework. Karraker, at 835.
32 Karraker, at 833.
33 Id.
34 Id., at 834.
35 Id.
36 Id.
37 “1) whether the test is administered by a health care professional; 2) whether the test is interpreted by a health care professional; 3) whether the test is designed to reveal an impairment of physical or mental health; 4) whether the test is invasive; 5) whether the test measures an employee’s performance of a task or measures his/her physiological responses to performing the task; 6) whether the test would normally be administered in a medical setting; and 7) whether medical equipment is used.” Id., at 835.
38 Id.
39 Id., at 836.
40 Id., at 835.
41 Id.
42 Id.
43 For an article opposing this design and effect test as too broad, see Scott Kramer, Why is the Company Asking About my Fear of Spiders? A New Look at Evaluating Whether an Employer-Provided Personality Test Constitutes A Medical Examination Under the ADA, 2007 U. Ill. L. Rev. 1279 (2007) available publicly at http://home.law.uiuc.edu/lrev/publications/2000s/2007/2007_4/Kramer.pdf. (arguing that the Karraker test is likely to be too restrictive on employer’s interest in screening out applicants based on tastes, habits and personality and suggesting that the test should be replaced by the author’s Medical Field Test, arguing that only tests used in the medical community are medical examinations under the ADA).
44 Susan J. Stabile, The Use of Personality Tests as a Hiring Tool: Is the Benefit Worth the Cost?, 4 U. Pa. J. Lab. & Emp. L. 279, 283 (Winter 2002).

Thursday, March 6, 2008

Why Do They Do That Thing They Do?

From an original image by Rhett Redelings, with permission.
(or How I Learned to Stop Hating the Mouse1)
by: Dwayne Stresman, Associate Editor, MTTLR

Don’t hate the player, hate the game”2

At one time, copyright law was to be a little-known discipline that few lawyers practiced, and one the general public knew (or cared) little about. My, how things have changed. These days copyright is “front and center” - hardly a week or two goes by without some aspect of copyright law appearing in the popular news, and most of the time the stories aren’t very heartwarming. You get everything from young women hit with 6-figure damages judgments for infringing file-sharing3 to artists threatening to sue their own fan clubs for allegedly infringing use of images and songs.4 All-in-all, it makes for quite a mess, and not surprisingly, commentators have called for change.5 But why do many rights-holders engage in what is seen by many as “Draconian” enforcement of copyright law? This post offers a possible explanation, from an economic perspective, which suggests that the actual structure of the copyright system may incentivize rights-holders to use a “take no prisoners” approach to enforcement.

Enforcement in an Eroding Rights Regime

Legal rules (or sets of rules) which grant rights fall into one of two categories. They either erode as a result of past breach or they don’t. Eroding rights are those which are lost if the rights-holder fails to adequately enforce them. For example, some common legal rights which erode in the face of past breaches are contractual rights (course of performance trumping even express terms), or real property rights (adverse possession).6 Alternatively, rights which don’t erode might include Civil Rights, or First Amendment rights. You don’t lose the right to speak freely simply because you failed to sue to remedy a past violation of that right. The category your particular right falls into can definitely affect what actions you take to vindicate that right.7

When examining an eroding rights regime, it only makes sense to look at scenarios which contain multiple time periods, or “repeat games”.8 A right can only erode if there are subsequent time periods in which the right has been devalued. In an eroding regime, a rights-holder acts not only because of the loss which results from the present violation, but because of future losses due to that violation. 9 That is, when deciding whether or not to attempt to enforce the current violation, a rational rights-holder takes into account the fact that in the subsequent period (or game) a failure to enforce in this period means that the value of their right in the next period is already diminished.

When deciding whether or not to enforce its right, a rational rights-holder will always weigh its cost of enforcement against its potential loss. In a static (non-eroding) regime this cost of enforcement is typically the cost of litigation for each violation. However, as already mentioned, under an eroding rights regime, a rights-holder must also consider the cost of erosion. As a result, the longer a game lasts (the more periods there are), the more the threat of erosion dominates the decision to enforce.10 Therefore, eroding regime games which contain multiple periods tend not to be governed by one-period concerns, but by long-term strategies. In such a situation, it is actually rational for a rights-holder to sue (even over a violation which is less costly than enforcement) in the first period, because doing so protects not only their present interest but their future interest as well.

Copyright Law as an Eroding Rights Regime

Is copyright law an eroding rights regime? If so, then this may, at least in part, explain why rights-holders sue to enforce their rights, even over seemingly trivial violations. In particular, I’ll focus here on two possible reasons why copyright law might be considered an eroding rights regime which is particularly likely to incentivize aggressive defense by rights-holders: 1) Much of the determination as to what copying is permissible (fair use) or not permissible (infringement) requires actual litigation, and 2) An actual market for the copyrighted content (the fourth factor in the fair use analysis) is potentially only created upon successful litigation.

At the heart of copyright law lies the notion that protection is granted to rights-holders primarily for the purpose of benefiting the general public.11 Fair use, arising under 17 U.S.C. § 107, is one way the law attempts to secure the public interest. Fair use potentially trumps any violation of a right granted by the copyright laws.12 However, a fair use analysis is highly factual in nature, and made only at the conclusion of an actual trial, after determination of exactly what the rights-holder possesses, and whether those rights have been unlawfully infringed. Litigation is synonymous with enforcement. The two acts are inseparable; without litigation, the extent of the right-holders actual rights are not defined, and thus not enforced.

In a related vein, sometimes litigation itself creates copyrights for rights-holders. In particular, the fourth fair use factor, the market effect of the allegedly infringing use, can actually be determined by the very lawsuit being brought.13 This circularity is perhaps the ultimate erosion regime in that the litigation actually creates a reverse erosion, or “expansion effect”. Not only is litigation required to maintain rights, but litigation can actually bring the legal right into existence. Not only would the right be eroded without enforcement - without enforcement it would never even have been created.


There are many legal rights which may erode over time due to non-enforcement. If real property rights can be forfeited in this way (adverse possession), then it seems possible, perhaps even likely that copyrights, as intellectual property rights, are similar. Further, in repeat game scenarios involving eroding rights, rights-holders actually have an incentive to enforce (litigate) even minor violations because doing so prevents future losses. If, as argued, U.S. copyright law fits this description, then understanding what motivates rights-holders in such a regime is essential, and attempts to change copyright law for the better will only be successful when they effectively deal with the incentives those laws create.

1 The mouse in question is, of course, Mickey. The Walt Disney Company is especially notorious for its “vigorous” enforcement of its copyrights. Perhaps the most famous case is Video Pipeline Inc. v. Buena Vista Home Entertainment, Inc., 192 F. Supp. 2d 321 (D.N.J. 2002), aff’d, 342 F. 3d 191 (3d Cir. 2003). You can find the opposing party’s creative public relations response by watching his video here: http://www.archive.org/details/willful_infringement_mickey_and_me.
2 Ice-T, Don’t Hate the Playa, (Coroner/Atomic Pop 1999). Song lyrics available at http://www.azlyrics.com/lyrics/icet/donthatetheplaya.html (last visited Mar. 6, 2008.).
3 Wikipedia, Jammie Thomas, (last visited Feb. 20, 2008). Thomas was found liable for violating the distribution right with regard to 24 songs and ordered to pay a total of $220,000.
4 Joel Horowitz, Prince Sues Fans, psfk, Nov. 9, 2007.
5 For what many consider the definitive statement on copyright change and other reforms, See generally Lawrence Lessig, Free Culture, (The Penguin Press, 2004). Full-text available free online at http://www.free-culture.cc/freeculture.pdf.
6 Omri Ben-Shahar, The Erosion of Rights By Past Breach, 1 Amer. L. Econ. Rev. 190 (1999).
7 Id. at 203-07, 215-19. Prof. Ben-Shahar lays out how, in the most general instance, the legal rule is irrelevant. However, he then goes on to show that making realistic adjustments to the general model will result in non-trivial differences in outcomes depending on the legal regime protecting the right.
8 For a quick discussion of game theory generally, including various types of game scenarios, See Wikipedia, Game Theory, (last visited Feb. 20, 2008).
9 Ben-Shahar, supra note 6, at 204-09.
10 Id. at 203-10. In each example, the number of periods corresponds inversely to the amount of harm needed to trigger enforcement. In a two period case, under an eroding rights regime, the trigger value for suit in period one is ½ the enforcement cost. In the three period case it is 1/3 of the enforcement cost. Extending this trend, for example, to 100 periods, or even to an infinite number of periods means that any violation, even a trivial one, triggers enforcement. But, again, Prof. Ben-Shahar reminds that, in the most general case, the number of periods does not favor a either a static or eroding regime. The relevance of static vs. eroding rights only comes into play when the general model is “tweaked”.
11 U.S. Const. Art. I, § 8, Cl. 8.
12 See 17 U.S.C. § 106 (subjecting § 106 rights to the fair use provisions of § 107, amongst other restrictions). Note, however, the controversy over whether the Digital Millennium Copyright Act (DMCA) provisions are meant to be subject to § 107. That is, whether a “fair use” defense is valid against a DMCA violation.
13 See, American Geophysical Union v. Texaco, Inc., 60 F.3d 913, 929 (2d Cir. 1995)(“whether the publishers can demand a fee for permission to make photocopies is the very question that the fair use trial is supposed to answer”); Princeton University Press v. Michigan Document Services, Inc., 99 F.3d 1381, 1407 (6th Cir. 1996)(Ryan, J., dissenting)(“The right to permission fees is precisely what is at issue here. It is circular to argue that a use is unfair, and a fee therefore required, on the basis that the publisher is otherwise deprived of a fee”).

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