Determining potential discriminatory practices in employment decisions often involves a statistical analysis known as the 80% rule or four-fifths rule. This method compares the selection rate of a protected group (e.g., based on race, gender, ethnicity) to the selection rate of the majority group. If the selection rate for the protected group is less than 80% of the majority group’s selection rate, a prima facie case of adverse impact may exist. For instance, if 60% of male applicants are hired but only 30% of female applicants are hired, the female selection rate (30%) is only 50% of the male selection rate (60%). As 50% is less than 80%, this scenario could indicate potential adverse impact.
Evaluating selection rates is crucial for organizations committed to fair employment practices. Such analysis assists in identifying potential biases in hiring, promotion, and other employment decisions. By proactively addressing potential disparities, organizations can foster a more equitable and inclusive workplace, mitigate legal risks, and enhance their reputation. This process has its roots in the Civil Rights Act of 1964 and subsequent legislation, reflecting a societal commitment to equal opportunity.
