Chapter 5: Personnel Decisions
Learning Objectives
• Explain the social and legal context for personnel decisions.
• Describe the process of personnel recruitment and affirmative action.
• Understand the statistical concepts of regression analysis and multiple regression analysis.
• Explain the concept and significance of validity generalization.
• Describe the selection of employees and the process of assessing job applicants.
• Identify issues pertaining to the determination of the passing score.
• Explain the concept and significance of test utility related to organizational efficiency.
• Describe the personnel functions of placement and classification.
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Chapter Summary
• Personnel decisions are decisions made in organizations that affect people’s work lives, such as selection,
placement, and discharge.
• All business organizations must make personnel decisions about their employees. Some organizations use
less formal and scientifically based methods than others.
• In the United States (and in most countries) personnel decisions are made within a strong legal context.
Many laws protect the rights of individuals as employees.
• Affirmative action is a social policy designed to achieve a diverse and productive workforce. There is much
controversy and social debate about the merits of affirmative action.
• Recruitment is the process by which individuals are encouraged to apply for work. The individuals selected
for employment can be drawn only from those who have applied.
• Two statistical procedures, regression and multiple regression analysis, are useful for making personnel
selection decisions.
• Validity generalization is the principle that the predictive capacity of a test generalizes or is applicable to a
wide range of job applicants and employment contexts.
• Because our tests do not have perfect validity, errors or mistakes in hiring occur. We can falsely hire a poor
employee or falsely reject someone who would have been a good employee. True positives and negatives
and false positives and negatives are useful concepts to consider in selection decisions.
• It has been demonstrated that using valid personnel selection methods leads to large productivity gains
for the hiring organization.
• Placement and classification decisions refer to assigning workers to those jobs for which they are best
suited.
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