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For example, if 90 out of 100 male applicants are hired (90%) and 15 out of 20 female applicants are hired (75%), is there an adverse impact? How do you know?

Answer :

Final answer:

Using the Four-Fifths Rule for determining adverse impact, comparing the hiring rates of 90% for male applicants and 75% for female applicants shows no evidence of discrimination, as the female rate is 83.33%, which exceeds the 80% threshold. However, organizations should still thoroughly review their hiring practices for fairness.

Explanation:

The consideration of whether there is an adverse impact in hiring involves comparing the hiring rates of different demographic groups. Adverse impact can often be detected using the Four-Fifths Rule, which suggests that if a protected group's selection rate is less than 80% (or four-fifths) of the most favored group's rate, there may be evidence of discrimination. In the scenario where 90 out of 100 male applicants (90%) are hired compared to 15 out of 20 female applicants (75%), we calculate the hiring rate of the female group as a percentage of the male group: (75 / 90) * 100 = 83.33%. Since 83.33% is greater than 80%, this suggests that according to the Four-Fifths Rule, there is no adverse impact.

However, it is important to recognize that this rule is not definitive and that any indication of potential discrimination should be investigated further with a comprehensive analysis that includes statistical methods and legal considerations. Moreover, in practice, organizations may also look into why such disparities exist and consider whether their hiring practices are fair and inclusive, even if they technically pass the initial adverse impact test.

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