Federal personnel chief Donald Devine, who has complained that he is saddled with the impossible task of coming up with a merit-based screening device that doesn't discriminate against blacks and Hispanics, has been told to take a look at the Federal Deposit Insurance Corp.
Devine is under a consent decree to stop using the Professional Administrative Career Examination because of its adverse impact on minority applicants. Under terms of the order, he must find some screening device that will select blacks and Hispanics in roughly the percentages in which they apply.
He said in a recent interview that he has been soliciting advice on how he might abide by the terms of the decree without abandoning the principle of merit selection.
The lawyers who won the consent decree say he should look at what FDIC has done. When the agency relied on PACE for its entry-level bank examiners, 13.2 percent of the white applicants, but only 1.2 percent of the minority applicants, scored high enough to be hired. Under its new screening procedures, whites are passing at roughly the old rate--14 percent -- but the pass rate for minorities climbed to 7 percent: a sixfold improvement.
How did FDIC do it?
Basically, by abandoning the written test in favor of an "accomplishment oriented" screening process. The agency sets basic eligibility requirements--generally a degree from an accredited four-year college with a major in business or accounting, with at least 12 semester hours of accounting.
Those who meet that basic requirement are then asked to describe, in writing, their experiences and their academic accomplishments. The idea is to give applicants a chance to show their knowledge of accounting principles and practices, their analytical judgment and, also, their communications skills.
Not only have minorities passed muster with the examining panels (composed of bank examiners from across the country) at significantly higher rates than under PACE, but they have been as successful on the job as those hired under PACE, FDIC officials say.
Whether the method will work as a government-wide replacement for PACE is hard to say. The FDIC's interest is in hiring potential bank examiners--a job with fairly specific academic requirements. Clearly, training in accounting is directly relevant to the work of bank examiners. The Office of Personnel Management, which Devine heads, hires for potential mid-management jobs in 118 separate categories, making it necessary to look at general qualifications while at the same time making it much more difficult to prove that any particular qualification is directly job-related.
In addition, FDIC hires relatively few applicants. In one recent hiring period, only 85 applicants were hired, including nine blacks. Even so, the total of minorities hired during the three hiring periods under the new procedure was only 7 percent of those who applied, half the rate for whites and far too low to meet the consent decree's requirement that white and minority applicants be hired in roughly the proportions in which they apply.
Still, the FDIC procedure is dramatically better than PACE in statistical fairness. In 1978, for instance, more than 54,000 applicants took the PACE exam; 42 percent of the whites passed it with a score of 70 or higher, but only 5 percent of the blacks and 13 percent of the Hispanics. Under the consent decree, which U.S. District Judge Joyce Hens Green finally signed last week, the percentages would have to be roughly equal for all three groups to avoid a finding of discrimination.
Personnel director Devine says the requirement saddles him with the responsibility of compensating for the inadequate academic background of many black and Hispanic applicants.
Two key facts emerge from what is happening at FDIC. First, there is the agency's discovery that job-related criteria--the things an applicant knows that are directly related to the work he is expected to perform--are substantially less discriminatory than the generalized tests the government typically administers.
And second, the on-the-job success, as revealed by retention rates and supervisors' ratings, is just as high as under PACE, which minorities were failing at such a disastrous rate.
FDIC seems to have found a way to reduce racial unfairness without sacrificing merit: precisely what Don Devine says he is looking for.