1. What is Adverse Impact Ratio?

The Adverse Impact Ratio is a measure used in employment practices to identify potential discrimination. It compares the selection rates of minority and majority groups to determine if there's a significant disparity that might indicate biased practices.

2. How Does the Calculator Work?

The calculator uses the adverse impact ratio formula:

Where:

• Minority Selection Rate — The proportion of minority applicants selected
• Majority Selection Rate — The proportion of majority applicants selected

Explanation: A ratio below 0.8 (the "four-fifths rule") typically indicates potential adverse impact, suggesting the selection process may be disproportionately affecting minority groups.

3. Importance of Adverse Impact Calculation

Details: Calculating adverse impact is crucial for organizations to ensure fair hiring practices, comply with equal employment opportunity regulations, and identify potential biases in selection processes before they lead to legal challenges.

4. Using the Calculator

Tips: Enter both selection rates as decimal values between 0 and 1. For example, if 30% of minority applicants were selected, enter 0.3. Both values must be valid (rates between 0-1, majority rate cannot be zero).

5. Frequently Asked Questions (FAQ)

Q1: What is considered a problematic adverse impact ratio?
A: Typically, a ratio below 0.8 (the "four-fifths rule") suggests potential adverse impact that may warrant further investigation into the selection process.

Q2: Is adverse impact the same as discrimination?
A: No, adverse impact indicates a statistical disparity, while discrimination requires proof of intentional bias. Adverse impact serves as an early warning sign that should prompt further investigation.

Q3: How are selection rates calculated?
A: Selection rate = (Number of selected applicants) / (Total number of applicants) for each group. These rates are then compared using the adverse impact ratio formula.

Q4: What factors should be considered besides the ratio?
A: Statistical significance, sample size, job-relatedness of selection criteria, and alternative explanations for the disparity should all be considered in a comprehensive analysis.

Q5: Can adverse impact analysis be applied beyond hiring?
A: Yes, it can be used to analyze promotions, terminations, compensation disparities, and other employment decisions to ensure fair treatment across protected groups.