Why should I analyze promotions data?

As workforce compliance requirements for federal contractors change, you may be reevaluating what types of employment decisions you should continue to evaluate on a regular basis. Based on our experience in helping employers defend selection decisions, it is important for most employers to continue to review all employment selections for fairness, including those involving both external and internal candidates, non-competitive and competitive movements. This blog focuses on a few reasons why employers should continue to evaluate internal talent movements as part of their ongoing compliance programs.

Let’s start with a few definitions for level setting. In the former Office of Federal Contract Compliance Programs Supply and Service Contractors Technical Assistance Guide (TAG), they included the following definition: “[A promotion] is any personnel action resulting in, for example, the movement to a position affording higher pay, greater rank, change in job title, or increase in job grade; an increase in pay, requiring greater skill or responsibility; or the opportunity to attain such. A promotion may be either competitive or noncompetitive.”  

In general, most employers define a promotion as a change in job title that brings an increase in job duties followed by an increase in pay (though your organization may have adopted a unique promotion definition.) 

The decisive difference between the two promotion types has to do with job openings and applicant pools. Non-competitive promotions are known as in-line, progression, or shoulder tap promotions. It’s not necessarily job duties that change but heightened and advanced experience helps to differentiate job “levels.”

For example, an Operator IV may be doing similar daily tasks to an Operator II, but the assumption is that the more advanced-leveled operator has more knowledge and experience. There also often isn’t a comparison to a specific pool of candidates or even a current job opening for this type of promotion. Perhaps you have a company policy that says after two years in a role, an employee advances to the next job level. That means whenever an employee reaches that predetermined milestone, they are awarded the promotion.

Conversely, a competitive promotion has a known, defined applicant pool based on eligibility for a job opening’s defined minimum (and preferred) qualifications. In some organizations, both external (i.e., non-employees) and internal (i.e., current employees) may apply to this open requisition. Aptly named, a competitive promotion signifies a ‘competition’ of winning the job: a current employee applies for an opening, competes against the other applicants, and wins the job for being best fit/most qualified.

Very often in talking to clients, we hear that promotions aren’t easily tracked, especially non-competitive promotions, but also sometimes competitive promotions. As one step, it is undoubtedly best practice to track competitive promotions in your company’s applicant tracking system. Implementing a disposition code in your applicant tracking system able to differentiate an internal competitive promotion from an external hire is also important. These small changes improve overall recordkeeping practices and allow companies to evaluate their competitive promotion decisions in a way that better reflects the decision-making process.

Similarly, employers can improve oversight of non-competitive promotions by consistently tracking key information about each promotion, such as the reason for the action, the employee's position, organizational unit, and relevant workforce demographics. Reviewing this data on a regular basis helps identify trends, determine whether promotion practices are being applied consistently across the organization, and highlight areas that may need additional review or policy changes. Establishing a standard process for collecting and analyzing this information supports more transparent decision-making and helps organizations continuously improve their promotion practices.

While recent executive orders have removed the requirement to prepare affirmative action plans for females and minorities, regular review of promotion practices is still a good idea to ensure compliance with Title VII of the Civil Rights Act, state and local nondiscrimination laws, and new federal contractor requirements, such as those set forth in Executive Order 14398.

In addition, both the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, as amended (i.e., the VEVRAA or Protected Veterans AAP) and the Section 503 of the Rehabilitation Act of 1973, as amended (i.e., the Individuals with Disabilities AAP) affirmative action program requirements call out that in their policy statements contractors specify that they’ll “recruit, hire, train, and promote” for all jobs without considering either disability or veteran status.

When completing the Protected Veteran and Individuals with Disabilities Data Collection Analyses, the job openings, jobs filled, and applicants hired computations also require that you include data about internal successful placements.

Promotion decisions are among the most important employment actions an organization makes, influencing employee engagement, retention, and career growth. Whether promotions are competitive or non-competitive, maintaining accurate data and reviewing those decisions regularly helps employers identify trends, improve the consistency of their practices, and demonstrate that advancement opportunities are being administered fairly.

As the regulatory landscape continues to evolve, organizations with reliable promotion data will be better positioned to respond to audits, defend employment decisions, and adapt to new compliance requirements with confidence. Investing in stronger promotion tracking today not only supports legal compliance but also provides valuable workforce insights that help build more transparent and effective talent management practices.