The first two articles in this series (part 1 and part 2) dealt with applicant reduction strategies. While not traditionally thought of as an applicant reduction strategy, we discussed how charging fees for testing can serve to reduce the applicant pool. Reducing the applicant pool can often be desirable since there are typically cost savings involved in relation to man power needed to handle applicants as they work their way through the selection process and efficiency benefits in regard to how quickly positions can be filled.
In addition to reducing the applicant pool by eliminating applicants that are not truly interested in the position being filled, charging fees can also help off set the costs incurred in the selection process. Karen Coffee, a Human Resources Consultant, made a presentation to a large segment of California Public Sector HR representatives in 1996, which was subsequently printed in Public Personnel Management, Vol. 25 No. 2 (Summer, 1996) in an article titled “To Fee, or Not to Fee.” Despite the fact that the article is now sixteen years old, the points she made are still relevant today. In fact, as time has gone on, and more and more jurisdictions have experienced financial challenges leading to budgetary restraints, the issue of charging fees may be even more relevant today than it was then. The full text of the article is available on this site.
Ms. Coffee’s article was intended to encourage jurisdictions to begin charging fees at some point in their selection processes and she gave several suggestions as to how this could be accomplished along with arguments as to why it was beneficial. In summary, her article touted the collection of fees as a way of helping to balance the budget and it provided lists of the issues and concerns that needed to be addressed when implementing fees for HR services.
Essentially the article asked jurisdictions to consider establishing fees or increasing current fees as a means of assisting jurisdictions with their shrinking budgets. In addition to implementing application fees and exam fees, the article stated that additional savings could be found in automating exams, reducing the amount of testing an agency does and extending the life of eligibility lists. Included in her justification for charging fees she cited: lack of money, high numbers of applications, high numbers of no shows and the need for sophistication in selection procedures.
Included in the justification for testing, Ms. Coffee also pointed out that it has been common practice for years for fees to be charged for school entrance exams like the GRE and LSAT as well as tests related to occupational licenses like nurses, psychologists, and building inspectors. Areas that jurisdictions charge or should consider charging for included: filing an application, purchasing a test prep book or offsetting the cost of the exam booklet, finger printing, background checks, failing the test, being an applicant from outside the jurisdiction, skills test like typing, no shows and test rental fees. The fees collected could be established to cover the entire cost of testing or simply offset a portion of the costs.
Issues raised in the article included seeking legal advice to determine if a jurisdiction has the legal right to charge fees. In addition a determination needs to be made determining what services will have an associated fee and what the fee will, be along with where the money goes in terms of the general fund, the HR budget or explicitly the budget allocated for testing. Further issues raised included how the fees must be paid, who will collect the fees, whether or not refunds will be given and who may be eligible to have their fees waived.
At the time that Ms. Coffee conducted a survey regarding fees, the jurisdictions responding that were charging fees at that time noted little if any adverse reactions from applicants while indicating that their was a general reduction in the number of applications filed and the number of no shows for exams.
In an effort to gauge the current state of charging fees IPMA-HR conducted a survey of member organizations and readers of this ASR blog, regarding their practices related to fees for HR services. While the number of agencies responding to the survey was rather small (20 respondents), the responses do indicate that there is a trend toward charging fees. Perhaps the most significant points gained from the survey are agencies are charging fees for submitting applications and testing and they are providing a waiver process for those claiming financial hardship. The fees charged ranged from $13.00 to $125.00. The survey results have been reported in full at the end of this article.
In the positions I held as Chief of Recruitment and Selection for a large metropolitan police force and subsequently for one of the fastest growing cities in the United States I was an advocate for fees for submitting applications and testing. Like many of my colleagues, in the profession, I recognized the money and man hours spent on candidates who were not serious or not qualified for the positions for which they were applying. In that regard it was not uncommon for only fifty percent of those submitting applications to show for a written exam.
Issues with no shows for testing increased dramatically when I was working for the State of Nevada and we implemented an online application system. Submitting an application for a position became as easy as entering a couple of key strokes once an applicant completed and saved an initial application. The ease of applying compounded the problem with handling applications from unsuited, unqualified, and less than serious applicants. It appeared that the mind set was; “Submit for everything and that way, I’ll get hired for something.” A non-scientific survey of our applicants indicated that we had several applicants that had filed over a hundred applications for as many different jobs.
Discussions with colleagues throughout the country showed that they agreed that a fee structure for applying and testing would assist with this burgeoning problem. We all agreed that while a fee system was needed that it would present its own set of problems. Other than charging for fingerprinting and skills testing, we along with many other jurisdictions opted not to charge for applying and testing choosing to take a more conservative approach and only charge for direct costs like fingerprinting.
The results of the current survey along with generally available information indicate that the time for charging fees has come. It is also gratifying to see that the limited data available from those that have taken the plunge have had the results earlier proposals hoped to achieve and that is the reduction of applicants that apply on a whim along with reduction of the numbers that fail to appear for tests.
While many of the obstacles to charging fees still exist, it does appear that the time has come for charging fees. Available data suggests that, while there is work to be done to overcome some of the obstacles and opposition to fees, that the work should be done and it has become easier to overcome obstacles and opposition.
It appears that agencies could greatly benefit from charging a nominal fee for filing an application, charging a slightly higher fee for taking an examination, and adding higher fees for other services like fingerprinting and conducting background investigations. The original fees will help dissuade applicants considering applying on a whim, reduce the no show rates for testing while recouping some of the costs involved in these processes. The fees charged later in the process can focus on recovering expenses paid by HR for these services and can be shown as having a direct correlation to the cost of doing business. Further, applicants can see this correlation and typically object less to paying fees since they have more vested in the selection process along with a greater opportunity of actually being selected.
Karen Coffee asked the question in her article, “To Fee or Not to Fee?” Now the response is more affirmative than ever before, “To Fee.”