u_3_ Department of Labcr Employment Standards Administration Of?ce of Federai Contract Compliance Programs 130 South Elmwood Avenue Room 536 Buffalo, NY 14202 Reply to the attention of: Tel: (716) 8-12-2979 Fax: (716) 842?2980 CERTIFIED MAIL RETURN RECEIPT REQUESTED 7007 3020 0000 7637 3210 March 20, 2009 Ted Cox, Deputy Vice President All Wheel Drive 4-Wheel Drive New Process Gear Division of Magna Powertrain 6600 New Venture Gear Drive lfiast Syracuse, New York 13057 Dear Mr. Cox: On August 8, 2007, this office began a compliance evaluation of Magna Powertrain New Process Gear (hereinafter NPG), and their compliance with Executive Order 11246, as amended, Section 503 ofthe Rehabilitation Act of 1973, as amended, and the Vietnam Era Veterans? Readjustment Assistance Act of 1974, as amended (38 U.S.C. 4212) and their implementing regulations at Title 41, Code of Federal Regulations, Chapter 60. This Predetermination Notice presents preliminary ?ndings with regard to employment activity for Production Operator positions during the period of January 1, 2007 through December 31, 2007 at NPG. OFCCP found that NPG failed to afford equal employment opportunity to minority applicants in the hiring for Production Operator positions because of their race, in violation of41 CFR initially, submitted information revealing that during the review periodFindividuals, including ?-ninorities, a lied for Production Operator positions. From ese applicantsp ere hired including inorities which yielded standard deviations of with a shortfall ot?29 minorities. OFCCP worked closely with NPG to clarify the pool of applicants. Applicants, and subsequently some hires, were eliminated for numerous reasons; among them, applicants and hires (1) who were existing NPG part time employees that were promoted to full time in accordance with the collective bargaining agreement; (2) who were afforded the opportunity to seltlidentify their race but refused to do so; and (3) who applied after the date of application ofthe last hire, May 21, 2007, of 4 War-king for Amerzca ?s Workforce The refined information revealed a total of pplicants, of which-vere minorities. There were-otal hires of which-vere minorities, indicating a signi?cant disparity in hiring. The analysis revealed that selection process had a disparate impact against minority applicants which resulted in-standard deviations with thirty?two (3 2) fewer minorities hired than would be expected given their representation in the applicant pool. OPCCP requested and received from NPG a narrative explanation, including documentation, of their hiring process for Production Operator positions. OFCCP also interviewed employees of the Human Resources department, an outside consultant involved in the process, as well as applicants and hires for these positions. OFCCP found that to be hired into a Production Operator position at NPG an applicant must be at least 18 years of age; possess a high school diploma or a and be available to work any shift. Management determines the need for new employees and a job requisition is opened. The job opportunities are advertised through local print ads, on the NPG website and through the America?s Job Bank. Interested candidates are directed to and must apply on?line. Applicants are screened and if candidates do not meet the minimum qualifications, they are rejected. If candidates meet the minimum required, they complete an application and are invited take a test. The WorkKeys Assessment test battery, which includes a test for Observation Skills, Applied Mathematics, Locating Information and Reading for Information, is owned and authored by American College Testing It was administered through the SUNY Syracuse War/(Keys Center. If applicants pass the tests, they are scheduled for a cross functional team interview. If an opening is available ajob offer is extended contingent upon a favorable background check and a post-offer physical exam. If applicants do not pass the test battery they may take a training class re?test or be eliminated from ?irther consideration ?3 Analysis: Because the analysis of the selection process for the Production Operator job group demonstrated an adverse impact, OFCCP analyzed each component of the selection process to determine the cause of the impact. That analysis revealed that the test battery administered by NPG had an adverse impact on minority applicants. As stated in 41 CFR 60? ?If the information that the total selection process for a job has an adverse impact, the individual components of the selection process should be evaluated for adverse impact.? Initially, NPG provided OFCCP with information on individuals who applied for Production Operator positions and whether they were tested, passed the tests, were interviewed, offered positions and/ or hired. initial analysis ofthe steps in selection process revealed that overall there was adverse impact indicated as previously stated. Further analysis of those aiilicants who were tested versus those who passed indicated standard deviations greater tha ith a shortfall of 33. After numerous discussions with representatives of NPG, revisions to the original information presented to us and interviews with applicants for Production Operator positions, OFCCP refined its statistical analysis. Many ofthe applicants originally identified by NPG as having been tested [coded as Did not pass pie?employment {851(3) or Did not showfor interview] did not in Page 2 0er fact actually take the test battery. From the revised data OFCCP identi?ed that-applicants -whites and ninorities] took the War/(Keys test battery. A total-)assed the test battery whi es and inorities]. This in a difference in passing rates that was signi?cant adverse to minorities at a level of?tandard deviations with a shortfall of 33. qf?lesi?s): OFCCP requested all documentation showing validity of the tests because of the adverse impact on the minority applicants tested for Production Operatorjobs (See 41 CFR 60?3. In response NPG provided OFCCP with WorHKegs: An Overview; Job Pro?ler Report: Production Operator; War-'kKeys Technical Handbook; National Career Readiness Certi?cate: l?VorHKeVs Assessments Technical Bulletin; ?Representative test forms?; and War/(Keys Assessment Information. However, none of these reports constitute a proper validation study and none acceptably support the validity of the four?test War/(Keys battery used by SUNY Syracuse War/(Keys Center for NPG. In order to acceptably establish validity War/(Keys must provide a basis for using each of the four tests by showing that the skills and abilities needed to perform the Production Operatorjob are the same as those assessed by the test battery. The documents provided by failed to provide: 0 Job Analysis: no acceptable job analysis was presented ACT did provide a Job Pro?le Report that was based on outdated information [1991 Dictionary ofOccupational Titles], did not include any ?relative? task weighting; and did not provide relevant information on the subject?matter expert (SME) groups used such as: knowledge of the job, work experience, or demographics. War/(Keys system: is a series of eight commercial tests offered by ACT with each of the eight measuring one particular skill. The identi?ed four skills underlying the job and ACT provided a combination oftest from their eight existing tests, [in this case a four?test battery, to assess those skills. No information was provided on whether or how any ofthe four tests were modi?ed prior to use to meet the job skills identi?ed. 0 Scoring Information: no information provided on how tests were scored, no information was provided on how the four tests were used to compile ?nal examinee scores, and no information was provided on how to determine whether an examinee passed or failed, and no cut score was provided. 0 Fairness: ACT provided no information that documented the fairness of the test, which is another important step in the process. NPG provided no analysis ofthe fairness of its selection procedures as they relate to each race/ethnic group to ensure that they are free ofbias. However, did no job analytic work, as previously stated, nor did they conduct an adverse impact analysis or do any additional work to determine the cause of the adverse impact. A liemative Selection Procedures: The OFCCP regulations 41 CFR 60-315 require that due to the signi?cant impact that the test battery had on the minority applicants, alternative selection procedures should have been identi?ed and fully described including the scope, method, ?ndings and conclusion reached. Information was not provided by Page 3 0H ACT WorkKeys. NPG on the identi?cation of alternative test procedures that possess validity but have less adverse impact. Given the large differences observed in the process and the adverse impact that occurred, the consideration ofalternative selection procedures was important and required. NPG should have conducted an investigation of suitable alternative procedures that have as little adverse impact as possible on minority applicant. As previously stated OFCCP reviewed all ofthe components ofthe selection process. Although there was adverse impact in the interview to hire component for both positions, the signi?cance level was not equal or greater than two standard deviations. Therefore, this component of the selection process was not a focus area in this review. But more importantly minorities were not getting to this stage of the process at rates comparable to their non?minority counterparts. In conclusion, based upon the information provided and reviewed, NPG could not support the validity of the testing component of its selection process used to select individuals for positions in the Operative job group. NPG did not provide a job analyses for the Production Operator position; could not demonstrate how the test predicted success in this position; and did not provide evidence that it searched for suitable alternative test procedures that would reduce adverse impact. Please be advised that this is a preliminary ?nding based on available information. You now have the opportunity to explain or rebut our preliminary ?nding. This notice is intended to address only an identi?ed pattern or practice of discrimination. You will be noti?ed of any other de?ciencies at a later date. Please respond to this notice within ?fteen (15) days from receipt ofthis letter. Your response should include any additional information and/or documentation you feel we should consider. If you do not respond, the preliminary ?ndings made in this notice will be incorporated into a Notice of Violations, which will be sent to you by certi?ed mail. If you have any questions, please call Compliance Of?cer his immediate supervisor, Assistant District Director Shear at (716) 842-2979. Sincerely, MARY ELLEN ENTIVOGLIJ District Director Buffalo and Hartford Of?ces cc: Burt Valanty, Director, Human Resources Owen T. McGraw, Employment Manager Mark D. 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