1. What is Adverse Impact Analysis?

Adverse impact analysis is a statistical method used to determine if employment practices (such as terminations) have a disproportionately negative effect on protected groups. The "80% rule" is a commonly used threshold to identify potential discrimination.

2. How Does the Calculator Work?

The calculator uses the adverse impact formula:

Where:

• \( Minority\ Termination\ Rate \) — Percentage of minority group members terminated
• \( Majority\ Termination\ Rate \) — Percentage of majority group members terminated

80% Rule: If the impact ratio is less than 0.8 (80%), adverse impact is indicated, suggesting potential discrimination in termination practices.

3. Importance of Adverse Impact Analysis

Details: Regular adverse impact analysis helps organizations ensure fair employment practices, comply with equal employment opportunity laws, and identify potential areas of discrimination before they become legal issues.

4. Using the Calculator

Tips: Enter termination rates as percentages (0-100). The minority termination rate should be the percentage of minority employees terminated, and the majority termination rate should be the percentage of majority employees terminated.

5. Frequently Asked Questions (FAQ)

Q1: What is the 80% rule?
A: The 80% rule (or four-fifths rule) is a guideline from the Equal Employment Opportunity Commission (EEOC) that identifies adverse impact when the selection rate for a protected group is less than 80% of the rate for the majority group.

Q2: Does adverse impact always mean discrimination?
A: No, adverse impact indicates statistical disparity. Further investigation is needed to determine if there is legitimate, non-discriminatory business reasons for the disparity.

Q3: What groups are protected in adverse impact analysis?
A: Protected groups include race, color, religion, sex, national origin, age (40+), disability, and genetic information under various federal laws.

Q4: How should termination rates be calculated?
A: Termination rate = (Number of terminations in group ÷ Total employees in group) × 100. Use consistent time periods for comparison.

Q5: What should I do if adverse impact is detected?
A: Conduct further analysis to understand the causes, review termination policies and procedures, document business justifications, and consider implementing corrective actions.