Recently I came across a TikTok post by Kathryn Anne Edwards who made the case for federal regulations that would require employers to compensate job interview candidates for their time during the interview process. Her post was a follow up on her article in Bloomberg, Applying for a Job Shouldn’t Be Humiliating. Her proposal includes mandates for companies to disclose hiring timelines, provide detailed information about the interview process, and maintain communication with candidates about their application status. Edwards suggests that if a job interview process is particularly lengthy or if candidates create valuable intellectual property during the interview, which may happen in the tech sector, they should be compensated. Additionally, if after job negotiations are complete and a job offer is made and then rescinded, employers should pay a penalty to the affected candidates.

Edwards’ rationale for these proposed laws centers on the need to respect the time and efforts of job seekers, ensuring they are treated with dignity throughout the hiring process. She believes that such regulations would reduce the friction in the job search process, providing clearer expectations and fair treatment for applicants. Edwards draws parallels to existing protections under the Equal Employment Opportunity Commission (EEOC) to argue that these additional measures are not only feasible but necessary to address persistent issues of ghosting and unclear communication from employers.

Kathryn Anne Edwards is a labor economist and independent policy consultant with extensive academic and professional experience so her proposals are not without insight. Edwards holds a Ph.D. in Economics from the University of Wisconsin-Madison and has conducted significant research on labor market dynamics, workforce policies, and economic inequality. She has worked with prominent institutions such as the RAND Corporation, where she contributed to various studies on labor economics and public policy. Her expertise and insights into labor market issues have made her a respected voice in discussions about employment practices and worker rights.

Challenges of Implementation

Edwards’ proposal is grounded in the belief that compensating interview candidates would ensure that candidates are treated with dignity and respect, reducing the psychological and financial toll of job searching. She compares these proposed regulations to existing protections under the Equal Employment Opportunity Commission (EEOC), suggesting that they are both feasible and necessary. Edwards highlights the prevalent issues of ghosting and unclear communication from employers, which leave candidates in a state of uncertainty and vulnerability. By implementing these regulations, Edwards aims to create a more transparent and fair hiring process that acknowledges and compensates the significant effort and time job seekers invest in their applications. However, there is another side of this argument that is felt by business owners.

I understand where the passion for these proposals come from; however, I can’t say I agree. The notion of creating labor law to address issues for the worker without equal protection for businesses would not be fair or equitable to both parties. While it might create some comfort for workers, there are many negative affects it would have on businesses and possibly workers as well.

Increased Costs and Administrative Burden

One of the challenges of implementing Kathryn Anne Edwards proposal to compensate interview candidates would be the increased cost for businesses. While Edwards argues that her proposal could help save money for businesses by tying financial penalties to the hiring process and forcing them to be more streamlined, I don’t feel the savings would be realized. Businesses would need to invest time and resources to get up to speed on a significant part of running their business. They would need to invest in compliant systems or software to track the interview process, ensure they properly manage communications with candidates, and ensure they develop compensation practices, which includes getting W9 tax information for each candidate. All of this would seem to require significant administrative and financial resources. For small and medium-sized enterprises (SMEs), these costs could be particularly burdensome. The expense of ensuring compliance with these new regulations could deter companies from expanding their workforce, potentially reducing the number of available job opportunities.

Potential for Abuse

Another significant concern is the potential for abuse of the system by candidates. Some individuals might exploit the proposed compensation regulations by applying for numerous positions with the primary intent of finding vulnerabilities rather than genuinely seeking employment. This could result in increased inefficiencies and resource strain on businesses, as they would need to invest time and money in processing and compensating insincere candidates.

Challenges of Hiring from a Business Perspective

The Job Negotiation Process

From a business perspective, there are already substantial challenges in the hiring process that Kathryn Anne Edwards proposal does not fully address. Negotiations between employers and candidates can be complex, with candidates often seeking higher pay, improved benefits, or other guarantees before they accept a job offer. These job negotiations can delay the hiring process and increase costs for employers. Additionally, candidates may use job offers as leverage to negotiate with other prospective employers or to gain better terms with their current employer.

While a primary candidate takes the time to negotiate, business will often not communicate to other candidates that were not chosen, in case the primary candidate does not accept the role. If the first candidate rejects the offer and a secondary candidate is made an offer, the business potentially starts the whole job negotiation process over again. However, if the business believes there is no good secondary candidate, or enough time has passed that and conditions have changed, the entire hiring process may start over again.

Quiet Quitting

Employers also face communication challenges, similar to those experienced by candidates. Businesses often encounter candidates who withdraw from the process late or stop responding entirely, leading to wasted time and resources. The recent trend of “quiet quitting,” where newly hired employees disengage from their roles without formally resigning, further illustrates how workers can take advantage of businesses. When workers engage in these practices it leaves businesses exposed. Unlike the protections proposed for job seekers, there are no equivalent recourses for businesses to recover their investments in employees who disengage or underperform.

High Costs and Time Investment in the Hiring Process

Overall, the hiring process is also fraught with challenges. Recruiting and hiring new employees is a costly endeavor, with expenses related to advertising job openings, screening resumes, conducting interviews, and onboarding new hires. According to the Society for Human Resource Management (SHRM), the average cost-per-hire for a new employee in the U.S. is over $4,000, and this figure can be much higher for senior or specialized roles. Additionally, the time investment required for these activities can strain existing staff and resources.

Difficulty in Finding the Right Talent Due to Skills Gaps and Retention Issues

Employers often struggle to find candidates with the necessary skills and experience to fill open positions. This skills gap is a persistent issue across many industries, exacerbated by rapid technological advancements and evolving job requirements. The challenge is compounded by retention issues, as high employee turnover rates mean that businesses must frequently engage in recruitment efforts. According to a SHRM survey, 83% of HR professionals reported difficulty in recruiting suitable candidates, indicating the widespread nature of this problem.

Seeking a Balance

While Kathryn Anne Edwards’ proposal aims to protect and respect job seekers, by compensating interview candidates, it is crucial to also consider the practical implications for businesses. Balancing the interests of both job seekers and employers is crucial for creating a fair and effective hiring process. Edwards’ proposal emphasizes the need for better communication and compensation for job seekers, ensuring that their time and effort are respected. However, implementing such regulations presents significant challenges for businesses, including increased costs, administrative burdens, and the potential for system abuse. These factors could deter companies from expanding their workforce and lead to inefficiencies in the hiring process.

Employers already face substantial hurdles, such as the high costs and time investment required for recruitment, difficulty finding qualified candidates due to skills gaps, and issues with candidate withdrawals and prolonged job negotiations. These challenges highlight the complexities of the hiring process from a business perspective, which Edwards’ proposal does not fully address. A balanced approach that considers the needs and difficulties of both job seekers and employers is essential for creating a more equitable and functional job market.

Further research and dialogue are needed to develop solutions that protect job seekers’ dignity while also ensuring that businesses can operate efficiently and sustainably. By fostering better communication, transparency, and fair practices, we can improve the hiring process for everyone involved, ultimately leading to more effective and satisfactory employment outcomes. Addressing both sides of the equation will help create a job market that benefits all parties, promoting a healthier, more dynamic economy.