During 2013 400 people were hired for a particular job Of th

During 2013, 400 people were hired for a particular job. Of the total, 300 were white and 100 were black. There were 1,200 qualified applicants for these jobs, of whom 800 were white and 400 were black. Does adverse impact exist? If adverse impact exists, what does this mean?

Solution

Answer:

White selection ratio = 300/800 = 37.50 %

Black selection ratio = 100/400 = 25.00 %

Here black selection ratio 25% is less than 30%(80% of white selection ratio 37.50%). Hence adverse impact exists.

Although it is not legally defined but in common practice, if selection ratio is less than 80% of other/highest selection ratio than it is perceived that adverse impact exists.

Adverse impact meaning:

Taking different rate of selection in hiring, promotion and other type of employment opportunities which discriminate a group of people on the basis of their race, sex, ethnic group, region etc.