Honesty Tests --- Why use them? Reduce employee theft Reduce inappropriate use of company resources (e.g., Internet, phone, supplies) Reduce counter-productive work behaviors (e.g., lying, policy violations) Reduce fraud (e.g., recordkeeping/accounting, expenses)

Honesty Testing (Some data on theft) Theft Frequency (mid 30% range) Study of over 9,000 employees in three different industries found that 1/3 (34%) of the typical company's employees admitted to some form of stealing from their employer U.S. Department of Justice --- 35% of store employees admitted to stealing from their Co. Lost Revenue (between 15 to 40 billion a year) Bureau of National Affairs --- Losses from employee theft are $15 – 25 billion annually US Chamber of Commerce --- employees steal between 20 - 40 billion dollars annually from their employers (this is 10 times the value of street crime in the US University of Florida 2002 National Retail Security Survey, employee theft responsible for 48% of store inventory shrinkage at an cost of about 15-billion dollars per year Neil Snyder of the University of Virginia --- About 1/3 of all small business failures can be attributed to employee theft

Some Reasons for Employee Theft Retribution --- “I am underpaid and I’m only taking what I deserve”; “The company angered me and I got back at it” Justification --- “Everybody does it, besides, they can write it off”; “The company makes a large profit and I deserve some of it” Shame/Low Self-Esteem—Feeling of feeling good at something Need Boredom/Excitement— To live on the edge Conformity --- “Everyone is doing it” Power and Control — Offset feelings of powerlessness Grief — Trying to fill a void due to a loss

Honesty (Integrity) Testing Increased usage with passage of the EPPA (1988) Study of Fortune 1000 companies; 28.5% used, or planned to use, honesty tests to screen applicants (Piotrowski & Armstrong, 2006) Wang, X., & Yancey, G. G. (2012). The Benefit of a Degree in I-O Psychology or Human Resources. The Industrial-Organizational Psychologist, 50, 45-50.

Two Basic “Types” Overt integrity tests 2) Covert (Honesty test questions imbedded within personality measures, e.g., among items assessing drug use/attitudes, tendency toward violence)

Honesty Testing --- Types of Questions (cont.) Covert Tests (tests about one’s attitudes thought to relate to honesty) It would be better if almost all laws were thrown away [Conventionality, traditionalism] Sometimes I am strongly attracted by the personal articles of others [Self-discipline] I like to take chances [Sensation seeking] On average, how often during the week do you go to parties? [Sensation seeking] Does it bother you when people ask stupid questions? [Forgiveness] How often do you make your bed? [Tidiness] I feel lonely even when I am with other people [Alienation]

Honesty Tests ---Validity Issues a) Correlations with polygraph results b) Future behavior (e.g., # days with cash shortage, discharges) c) Admissions of past theft d) Shrinkage reduction e) Contrasted groups (e.g., scores by criminals vs. general population scores) Other Issues Cut-off Score Determination e.g., cost-benefit assessment; tailoring the cut-off score for individual companies and job categories?) Approximately 40-70 percent of test takers fail honesty tests (Sackett, et al. 1989) Should scores on other tests be allowed to compensate for poor honesty test scores? Role of honesty test score in the selection system (e.g., fail an honesty test but pass personality and ability tests). In practice, most organizations use honesty tests as the last step in their selection process. Integrity tests can be faked – especially overt tests – and that the more likely candidates to fake honesty are the dishonest candidates! Sackett et al., 1989  

Some Evidence on Honesty Testing The American Psychological Association (Goldberg, Grenier, Guion, Sechrest, & Wing, 1991) [Review of almost 300 studies (research publication and test publishers] Finding: “for those few tests for which validity information is available, the preponderance of the evidence is supportive of their predictive validity” (Goldberg et al, 1991, p.26). Large-scale meta analysis of 665 validity coefficients for integrity tests (Ones, Viswesvaran, & Schmidt, 1993) Validity coefficient with supervisor ratings of job performance as the criterion was .21 (corrected for criterion unreliability and range restriction in the criterion, r = .34) Average predictive validity of a criterion defined as “counter-productive behaviors” (CWB-O and CWB-P -- e.g., theft and theft-related incidents,, sabotage, abuse/violence, production deviance, withdrawal). Over 443 validity coefficients --- r = .33; corrected value = .47