Andreessen has a great post about the process of job interviews: http://blog.pmarca.com/2007/06/how_to_hire_the.html . He recommends not to put too much weight on skill tests, and instead focus on things like drive, passion, ethics, etc...

Having recently been through an interview that was a complete waste of time, I can sympathize with the author of the post.

Right, but Andreessen also says, in that post:

For example, test programmers on basic algorithms -- linked lists, binary searches.

Just in pseudocode -- it doesn't matter if they know the relevant Java library calls.

It does matter if they are unable to go up to the whiteboard and work their way through something that was covered in their first algorithms course.