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Adverse Impact Calculation:
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Adverse impact analysis evaluates whether employment practices have a disproportionately negative effect on protected groups. The "4/5 rule" (or 80% rule) is a standard threshold for identifying potential discrimination in termination decisions.
The calculator uses the 4/5 rule formula:
Where:
Explanation: If the selection rate for a protected group is less than 80% of the non-protected group's rate, adverse impact may exist.
Details: Regular adverse impact analysis helps organizations identify potential discrimination in termination practices, comply with equal employment opportunity laws, and maintain fair workplace practices.
Tips: Enter the number of terminated employees and total employees for both protected and non-protected groups. All values must be non-negative integers.
Q1: What is considered a protected group?
A: Protected groups include categories like race, color, religion, sex, national origin, age (40+), disability, and genetic information.
Q2: Does adverse impact always mean discrimination?
A: No, it indicates a statistical disparity that warrants further investigation. Legitimate business reasons may explain the disparity.
Q3: What should I do if adverse impact is found?
A: Consult with HR and legal professionals to review the termination practices and ensure they're job-related and consistent with business necessity.
Q4: Is the 4/5 rule the only test for adverse impact?
A: No, other statistical tests (like standard deviation analysis) may also be used, but the 4/5 rule is the most common threshold.
Q5: How often should adverse impact analysis be conducted?
A: Regular analysis (e.g., annually or with significant organizational changes) helps proactively identify potential issues.