Rutgers business school accused of rankings fraud, hiring own grads in temp jobs to boost its scores

When vying for college rankings, business schools must report how many of their students have jobs at graduation and again three months later.

The more, the better.

Rutgers University’s business school, according to a lawsuit filed in federal court this month, gamed the ranking through a simple trick: paying an outside temp agency to place its graduates in jobs — with Rutgers itself.

The whistleblower suit, filed by the business school’s current human resources manager who is upset at Rutgers, alleges the school spent at least $400,000 to put seven graduates into campus jobs in 2018 and 2019. The suit says Rutgers put the grads into “sham” positions, well below what they could be expected to handle, even though the rules require that students be doing MBA-level work.

A companion suit, filed by the same firm as a possible class action on behalf of aggrieved students, says Rutgers submitted “false and misleading employability statistics” to U.S. News & World Report, the Financial Times, and other rankings organizations.

» READ MORE: Temple's former business school dean was sentenced to 14 months in rankings scandal fraud

“Students chose to attend Rutgers based on these false representations and manipulated MBA and other masters programs ranking statistics,” this suit says.

Rutgers denies the allegation. It said it was “confident in our process and procedures to accurately report to rankings publications.”

It added: “The Rutgers Business School team follows the guidelines set by the standards agencies, maintains control over our statistics and methodically reports the information.”

Beyond that, Rutgers would not answer any questions or provide any information about the hirings. U.S. News also would not answer questions and refused to make available previously public material on how it had ranked Rutgers. The New Jersey law firm that brought the two lawsuits would not let its clients grant interviews.

The Rutgers case is the latest in many years of allegations about inaccurate reporting by universities to rankings organizations. Last month, Moshe Porat, the former dean of Temple University’s business school, was sentenced to 14 months in federal prison for concocting a complex scheme to lie to boost his school’s ranking.

Temple’s online MBA program climbed to U.S. News’ No. 1 spot after the school provided fake and exaggerated numbers for the tally of incoming students who had taken the graduate entrance exam. Its new rank — 105th. The case marks the only time a college administrator has been criminally charged for monkeying with the rankings. Temple paid $5.4 million to settle a class-action suit brought by misled students.

» READ MORE: Temple’s business school is ready to ‘close this ugly chapter’ after its former dean is convicted in rankings scandal

Also last month, the University of Southern California pulled its graduate school of education from all rankings, admitting it had submitted incorrect data going back five years. And a math professor at Columbia released a blistering critique saying his own university had jacked up its ranking with “inaccurate, dubious or highly misleading” data, including counting money spent on medical care as educational spending.

These are only the latest allegations in a long history of colleges’ attempting to game the system to hurtle their schools to the top of the rankings. In this area, Villanova University’s law school got in trouble a decade ago for providing inaccurate data on student grades.

» READ MORE: Law Review: Villanova law school paying a price despite doing right

“It’s very hard to say it’s getting better or worse,” said Colin Diver, a former dean of the University of Pennsylvania law school, who has written a book critical of college rankings. “It’s just the tip of an iceberg and we don’t really know how big the iceberg is.”

Professional organizations over the years have set standards to attempt to address concerns, but schools continue to find ways around them.

“I describe the history of rankings as an ongoing whack-a-mole process,” Diver said. “Rankings should have warning labels attached to them.”

A decade ago, critics pointed to a number of law schools that were padding their employments statistics by counting any job, full-time or part-time, and even creating phony jobs for graduates. Under pressure from Congress, the American Bar Association tightened its reporting guidelines in 2011, and ranking firms began giving less weight to students who held jobs in which they were employed by their own college. This crackdown, however, appears to have only affected law schools.

More broadly, critics says the rankings are constructed on questionable criteria and distort the priorities of colleges, putting an emphasis on such factors as schools’ acceptance and rejection rates and de-emphasizing their commitment to social issues or a diverse student body.

While a jury found Temple’s former dean guilty of brazenly fabricating numbers, the allegations in the Rutgers case lay out a more sophisticated scheme. At Rutgers, Diver said, the allegation is that “they submitted true data about a manufactured practice.” Diver called that “a really sketchy practice.”

In the Temple scandal, the school itself admitted to reporting inaccurate data that led to its No. 1 ranking for the online MBA for four consecutive years. U.S. News stripped the ranking from Temple and kept the business school out of rankings for a couple years while problems were addressed.

Rutgers, meanwhile, is maintaining the accuracy of its data.

Rebecca Kolins Givan, an associate professor at Rutgers and president of its faculty union, said the Temple case and the Rutgers’ allegations, if true, “show the ill effect of the rankings race.”

“It’s clear that institutions of higher education are under tremendous pressure to compete in the race for high ratings,” Givan said last week. “With a sustained lack of public investment and high levels of student debt, universities and those who work in them are faced with a set of distorted priorities that take us all away from our core missions of teaching, research and service.”

Derek Muller, a law professor at the University of Iowa, who has analyzed the ranking systems, said hiring graduates was a relatively inexpensive way to drive up scores. “It’s a very low-cost way of juicing those numbers,” Muller said..

Another critic, Wendy Espeland, a sociology professor at Northwestern University in Illinois, said colleges often cluster together in their rankings. She said even small changes can give a university an edge.

“Because things are compressed, tiny changes can bump things around,” she said.

» READ MORE: Under a national spotlight, former Temple business dean faces fraud trial in college rankings scandal

In the whistleblower suit, plaintiff Deidre White, who lives in Burlington Township in South Jersey and who joined the Rutgers staff in 2015, paints a dismal picture of a hostile workplace that piled tasks on her while failing to accommodate her disability — Graves’ disease, a thyroid condition with symptoms for some ranging from anxiety to tremors.

As she took medical leaves, she contends, the university retaliated by not allowing her to hire another aide, setting her up for failure. In her suit, she says top administrators in the business school dismissed her as “a disgruntled employee who is a complainer and mopes around a lot.”

While her suit says the plan to hire the MBA students dates to 2018, White’s lawyers acknowledge that she did not raise a formal concern about it until last month. They say the publicity over the Temple case spurred her into taking action. The suit said she finally leveled her complaint in a March 21 email to the business school’s dean, Lei Lei. In her email, she cites how Rutgers had used an employment firm, Adecco, an international company, to hire its graduates, a step she contends was a way to mislead the ranking firms.

“I am very, very concerned that, despite my best efforts, you and your colleagues do not take fraud and misconduct seriously,” White wrote. “After the recent criminal sentencing of the Temple dean, one would think that RBS would operate to the letter of the law. In my view Rutgers has manipulated data to inflate the school’s ranking. Adecco is a complete sham, and you know it.”

Lawyer Charles J. Kocher of McOmber, McOmber & Luber, the New Jersey law firm that filed the suits, acknowledged the firm can’t yet say whether Rutgers was still placing MBAs in the temp jobs or how many in total have been hired. Nor can the firm spell out precisely how the hirings affected rankings.

“Our analysis of the rankings is ongoing and will proceed through discovery to understand what Rutgers reported to the educational organizations,” Kocher said.

In her suit, White alleges that the job scheme was hatched at a meeting she attended in June 2018.

Rutgers had about 110 students graduating from the 21-month program that year. In the suit, White names seven students she says were hired through the program.

In 2018 emails made public in her suit, administrators go over a list of graduates who had yet to find jobs — and discuss the deadline by which they had to be hired to count for rankings.

“By what date students should be employed by?” one asks.

A colleague replies, “The 90th day after commencement is Aug. 16. Students must have accepted an offer, whether verbally or in writing, on or before this date.” This email was copied to the school’s dean, Lei, the suit says.

One of the U.S. News measures is how graduates have jobs three months after getting their MBA.

Most of the jobs lasted six months. In two cases documented in the suits, the graduates were to be paid $35 an hour, “on assignments at Adecco’s clients.”

In the legal actions, a key allegation is that the students were placed in jobs beneath the level of work normally done by MBA graduates.

U.S. News tells business schools that they should follow standards set by a Florida-based business career-development organization, known as the MBA Career Services and Employer Alliance. In those standards, the organization says that to count, jobs must be for MBA-level work.

» READ MORE: Former Temple business school dean guilty in rankings scandal fraud case

But the Florida organization’s guidelines allow room for interpretation. Staff, they say, should “use their best professional judgment when making a determination that a graduate’s job is a professional MBA level employment.” They add: “If the graduate believes the job is MBA-level ... then the job is MBA-level.”

In response to questions from The Inquirer, the organization said nothing bars schools when counting their own employees when filing figures for jobs held by MBA graduates. In doing so, however, the group said they should consider how likely a job is to become permanent in deeming a position MBA-level.

At one point in 2018, White’s lawsuit says, a Rutgers administrator objected when the business school was preparing to grant jobs to two graduates, saying they both were “significantly overqualified” and that the school should hunt for less-skilled applicants.

“I understand they may be overqualified but if they are willing to accept please go ahead,” was the response.

Later in 2018, Lei and an assistant dean exchange messages about whether it was necessary to explain to the ranking organizations that the in-house positions were temporary.

“I am not familiar with the placement data reporting process,” Lei wrote. “However, if the temporary hiring should be disclosed to the ranking agency, please do so to avoid any misunderstanding. The reputation of RBS and our integrity are more important than anything else.”

The assistant dean responded that the jobs have the “potential of leading to a full-time position. ... If that is the case, the standards state that we count them as employed.”

How all of this drove Rutgers’ rankings is unclear.

To score colleges, the various services each rely on their own arcane methods. U.S. News for example, has a system under which it takes into account such factors as the opinions of other academics of a school, how hard a school is to get into, and the starting pay of graduates. It says it bases 21% of the overall score on what share of the graduates have landed jobs.

U.S. News refused to make available its yearly scores for employment for Rutgers business school, though it makes them public on an annual basis on the internet. However, The Inquirer obtained them from another source. The results were mixed. In 2016, for instance, the school reported that 93.5% of its newly minted MBAs had jobs three months after graduation. The figure rose and fell after that, and in the most recent tally, hit 97.2%.

Overall, in its newest ranking last month, U.S. News deemed Rutgers’ full-time business school program as the 45th best in the nation. Still, its figure for job placement after three months was slightly better than that of the No. 1 (tied) MBA full-time programs, those of the University of Pennsylvania and the University of Chicago.

The latest U.S. News overall ranking for the Rutgers program was down one step from its 44th ranking in 2018, according to John A. Byrne, editor-in-chief of Poets & Quants, a website that reports on business schools and archives rankings.

In a message to staff and faculty, cited in White’s suit, Lei found “wonderful news” in another ranking, from the Financial Times. Among U.S. public business schools wrote, Rutgers was No. 3 for employment after three months.

“Thank you for your efforts to continually deliver a meaningful MBA experience at Rutgers Business School,” she wrote. “Go Team - RBS!!!”