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Adverse Impact Calculation Example

Adverse Impact Ratio (AIR) Formula:

\[ AIR = \frac{\text{Minority Selection Rate}}{\text{Majority Selection Rate}} \]

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1. What Is Adverse Impact Ratio?

The Adverse Impact Ratio (AIR) is a statistical measure used to identify potential discrimination in employment practices. It compares the selection rates of protected minority groups versus non-protected majority groups to ensure fair hiring and promotion processes.

2. How Does The Calculator Work?

The calculator uses the Adverse Impact Ratio formula:

\[ AIR = \frac{\text{Minority Selection Rate}}{\text{Majority Selection Rate}} \]

Where:

Explanation: The AIR measures whether there is a significant disparity in selection rates between different demographic groups, with values below 0.8 typically indicating potential adverse impact under the "80% rule".

3. Importance Of AIR Calculation

Details: Calculating AIR is crucial for organizations to ensure compliance with equal employment opportunity laws, identify potential discrimination, and promote diversity and inclusion in workplace practices.

4. Using The Calculator

Tips: Enter the number of people selected and total applicants for both minority and majority groups. Ensure all values are positive integers and that selected numbers do not exceed total numbers for each group.

5. Frequently Asked Questions (FAQ)

Q1: What Does AIR < 0.8 Indicate?
A: An AIR below 0.8 suggests potential adverse impact according to the "80% rule" used by the Equal Employment Opportunity Commission (EEOC) as an initial screening tool for discrimination.

Q2: Is AIR The Only Measure Of Discrimination?
A: No, AIR is an initial indicator. Further statistical analysis and investigation are needed to determine if discrimination actually exists and to identify contributing factors.

Q3: What Groups Are Considered Protected?
A: Protected groups typically include race, color, religion, sex, national origin, age, disability, and genetic information as defined by federal employment laws.

Q4: How Often Should AIR Be Calculated?
A: Organizations should calculate AIR regularly (annually or quarterly) for key employment decisions like hiring, promotions, and terminations to monitor for potential disparities.

Q5: What Actions Should Be Taken If AIR < 0.8?
A: Investigate the reasons for the disparity, review selection procedures for bias, provide diversity training, and consider implementing corrective measures to ensure fair practices.

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