This is retarded.
You don't always lose your job or get laid off because you're incompetent. In fact, the higher you go in your education, the more chance you strike of being over-qualified for a job. This is a serious problem nowadays. Overqualification is really striking for many people who have completed their phd's, and preventing them from getting a proper job.
Lay offs just happen, especially with this troublesome economy. Labor needs to be cut, so they cut it. Sure, a manager would probably try to cut the employees who don't do as well, but this is not always the case in terms of lay offs, and this has been stereotyped too far.
Those who are unemployed need a job even more than those who aren't anyways.
This requirement shouldn't even exist, let alone be considered a "positive" factor. Too bad even if we remove this rule, the hiring managers are still going to feel biased.