Disparate impact refers to policies, practices, or other systems put in place by an employer that appear neutral but have unintentional discrimination impacts on certain protected groups.
Is Disparate Impact Linked to Discrimination?
Disparate impacts refer to unintentional discrimination.
United States federal laws prohibit job discrimination based on race, color, sexual orientation, gender, religion, etc.
What Are Examples of Disparate Impact?
Examples of disparate impact include:
- A test that automatically disqualified Asian Americans from getting a job offer
- A hiring process that discriminates against women because of their physical height or strength
What Is the Difference Between Disparate Impact and Disparate Treatment?
Disparate impacts are a result of unintentional discrimination whereas disparate treatments are a result of intentional discrimination.
What Is the Difference Between Disparate Impact and Adverse Impact?
Adverse impact is often used as a synonym to disparate impact. It refers to the discriminatory effects caused by a decision, practice, or policy.
How to Calculate Adverse Impact?
The steps to calculate adverse impact of your recruitment process include:
- Calculating the rate of selection for each group by dividing the number of persons selected from a group by the number of applicants for the same groups.
- Determining which group has the highest selection rate.
- Comparing the selection rate of each group with that of the highest group by dividing the rate of the lowest group by the rate of the highest group.
- Determining if the selection rate difference is lower than 80 percent.
For example, in a hiring process, 80 Caucasians applicants out of 120 were hired, whereas 10 Latinos applicants out of 50 were hired. The selection rate of caucasian is 66.7% (80÷120×100=66.7). The selection rate of latino is 20% (10÷50×100=20). The selection rate difference between the 2 groups is 30% (20÷66.7×100=30).
There is an adverse impact in the selection process because the selection rate difference is lower than 80 percent.