CHICAGO (AP) — Two women who applied for jobs to test whether a security firm discriminated against minorities have lost their lawsuit, a key federal case that asked whether it's legal to lie to an employer in an effort to document wrongdoing.

JK Guardian Security Services did not engage in biased hiring practices by denying employment to the two black applicants who were paid representatives of the Legal Assistance Foundation of Chicago, a jury decided Friday.

"As the first case of this kind ever to go to trial, the jury sent a clear message that claims of discrimination will need more than just the fact that African-Americans did not receive job offers," said Douglas Drach, an attorney representing JK Guardian.

Testing opponents say one or two visits to an employer are insufficient to prove bias.

But civil rights advocates say testers — long used to document housing discrimination — are necessary to investigate employers. Most testing is done by private groups with financial support from government agencies.

The Fair Housing Act authorizes the use of discrimination testers in housing. But there is no federal law or definitive court ruling on employment testers, which made the Chicago case an important test.

In the case, Kyra Kyles and Lolita Pierce said they applied for a receptionist job at Guardian in 1995 and were told selected applicants would be called later for second interviews. But when a white tester with similar credentials applied for the same job, she was immediately tested, interviewed and offered the job, they said.

U.S. District Judge Suzanne Conlon threw out the lawsuit, saying the testers had no standing to sue because they didn't want the job for which they had applied.

But the 7th U.S. Circuit Court of Appeals overturned the decision and sent the case back for trial. The appellate court ruled civil rights workers who apply for jobs to test whether employers discriminate against minorities in hiring may sue those who show bias.

Diana White, a lawyer for the Legal Assistance Foundation, said the group was surprised and disappointed by last week's verdict.

"We can't talk to jurors so we don't know why they did what they did. We thought we had strong case," she said. "I don't think it invalidates employment testing. There are plenty of other uses for it."

Copyright© 2000 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.