Beware The Legal Risks Of Personality Tests In Hiring - Daniel Schwartz April 6, 2023 - Legal risks and compliance guidance

Sep 18, 2026

Uploaded by Blaney

Personality tests are increasingly used by employers to evaluate candidate fit, and AI-enhanced versions are gaining momentum, particularly for remote roles with different skill needs. The article traces early adoption and highlights modern growth, then focuses on legal exposure: risks of discrimination under race and national origin standards, disparate impact concerns, and the need for job-related, validated, and consistently administered assessments. It also covers ADA accommodations, equitable criteria, and state or local limits on testing and automated hiring tools.

LanguageEnglish

CategoryResearch & Report

FormatPDF

Pages4

Reading Time10 min

AccessFree to download

Employment and growth of personality tests

Legal concerns and enforcement examples

EEOC and validation requirements

Job-related, reliable criteria

Multiple assessments and fair administration

Discrimination, ADA, and accommodations

Disparate impact and protected classes

Equitable use across candidates

State and local legal considerations

Integrity testing and automated decision tools

Practical compliance steps for employers

Beware The Legal Risks Of Personality Tests In Hiring By Daniel Schwartz (April 6, 2023) Personality tests are the next big thing for employers looking to ensure that they are hiring employees who will be a good fit for them. Indeed, a recent New York Times article describes the use of such personality tests as a burgeoning $2 billion industry.[1] The use of the personality tests is not actually a new endeavor. One of the first personality tests to gain widespread use in hiring was the Woodworth Personal Data Sheet, developed in 1917 by Robert S. Woodworth, a psychologist at Columbia University. The test was designed to identify soldiers who were at risk of developing shell shock during World War I, but it was later adapted for use in hiring and personnel selection. Daniel Schwartz However, with new technology and artificial intelligence promising benefits, far more sophisticated personality tests are finding new traction. It's particularly seen as helpful as employers hire for remote work positions that have a different skill set than in-office positions. According to The New York Times: Some managers find them particularly useful for remote teams, because personality tests can prompt much-needed conversations about who workers are as humans and how they like to interact. However, before employers sign up to use personality tests, there are some significant legal concerns that should be addressed. Indeed, in 2018, Best Buy Co. Inc. settled a claim by the U.S. Equal Employment Opportunity Commission that the company's use of personality tests/assessments during the application process allegedly adversely affected applicants based on race and national origin. That claim was based, in part, on a 2007 fact sheet released by the EEOC that further raised concerns about their usage.[2] It noted, in some measure, that employers should ensure that employment tests and other selection procedures are properly validated for the positions and purposes for which they are used. The fact sheet raises certain suggestions — which may seem obvious — but are still relevant today: • Employment tests and selection procedures should be job-related and consistent with business necessity. Employers must ensure that these tests and procedures are based on valid and reliable criteria that are directly related to the job in question. • Employers should use multiple methods of assessment to make employment decisions. A single test or procedure should not be the sole basis for making a decision about an applicant's suitability for a job. • Employers must ensure that their tests and procedures do not have a disparate impact on any protected group. Disparate impact refers to a situation where a test or procedure appears neutral on its face but has a disproportionate impact on people in certain protected groups. • Employers should ensure that their tests and procedures are administered fairly and consistently. All applicants should be given the same instructions, time limits and testing conditions. • Employers must provide reasonable accommodations for applicants with disabilities. If an applicant requests an accommodation to take a test or participate in a selection procedure, the employer must provide the accommodation unless doing so would cause an undue hardship. • Employers should regularly review and validate their tests and procedures to ensure they are still job-related and nondiscriminatory. Validation should be done by a qualified professional who has expertise in testing and statistical analysis. Personality tests — and the use of artificial intelligence in hiring decisions — seem neutral on their face. This is particularly true in how some of the firms making such tests market them. The producers tout certain advantages such as increased hiring accuracy, time and cost savings, legal compliance, and improved retention and engagement. But employers should try to look behind the curtain if possible. Ti

FAQs

Why are personality tests attracting increasing use in hiring?

Employers view them as helpful for assessing fit and enabling human-focused conversations, especially for remote teams. The market has also grown as technology and AI offer more sophisticated options.

What legal issues did the article highlight from enforcement and claims?

It discusses a settlement involving Best Buy and concerns raised by EEOC guidance, emphasizing that tests can adversely affect applicants and require proper validation and compliance to avoid liability.

How should employers reduce legal risk when using personality tests or AI in hiring?

Employers should ensure tests are job-related and consistent with business necessity, use multiple assessment methods, provide disability accommodations, administer tests fairly, and regularly review validation for disparate impact and nondiscrimination.

Sep 18, 2026

Uploaded by Blaney