Typically, cutoff scores are established for tests so that scores below the cutoff are deemed “failing” and disqualify candidates from further consideration. If the employer cares about the degree of the tested-for characteristic possessed test takers with passing scores can be ranked and candidates with the highest scores chosen. One consideration in treating test scores is that employers must not adjust the scores of, use different cutoff scores for, or otherwise alter the results of employment-related tests on the basis of race, color, religion, sex, or national origin.

This prohibition of what has been termed race norming, although not specific to race, means that employers cannot establish separate minimum standards based on protected class or obscure the existence of different standards by altering scores. Clearly, the results of a test are affected by what the employer determines to be a passing score. If a test is job-related, are there any legal limitations on how high employers can set the bar in terms of cutoff scores?

Some courts go further and require that if a test creates disparate impact, cutoffs must be set so that they require no more of the tested-for trait than the minimum needed to successfully perform the job. Requirements in excess of this level would not be a “business necessity.” However, this does not mean that an employer must under these circumstances set a cutoff at the level at which no individual who scores below it would be able to perform the job.

That is, an employer can set a cutoff at a level where there is much higher probability that persons who pass the test will also succeed on the job. However, requirements for one job must not be set unduly high based on the idea that persons hired will then be qualified to move on to other jobs. The “banding” of test scores can diminish the discriminatory effects of tests without unduly compromising the principle of selecting the most able candidates. In banding, test scores are treated as estimates of tested-for characteristics.

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