The four-fifths rule or what some call the 80% rule is a common way of
Establishing whether adverse action and a selection decision exists the four-fifths rule is a guideline
generally accepted by the courts and the EEOC
For making a primary case of disparate impact by showing that an Employment Practice results in members of a protected class
being treated less favorably
by an Employment Practice the members of a non protected class
Adverse impact refers to employment practices that appear neutral, but have a discriminatory effect on a protected group
Adverse impact may occur in hiring promotion training and development transfer layoffs and even performance appraisals
Title 7 of the Civil Rights Act of
1964 prohibits discrimination in employment and otherwise based on certain characteristics of an individual that are protected by law
including race color religion sex and national origin
Because of this legal action can be brought against an employer if its policies or practices have discriminatory effects
Unless the employer can show it adopted that policy or practice to serve a legitimate business purpose
To establish that an employer has violated Title 7 and prove a disparate impact
employment discrimination case a plaintiff must demonstrate that a specific employment policy or practice caused an
adverse impact on a protected class of individuals
the Equal Employment Opportunity Commission
The Department of Labor and the courts have adopted a test known as the four-fifths rule to calculate adverse impact
This test compares the rates of selection for lesser represented classes of individuals
against the rate at which the most represented glu group is selected if
The lesser represented group has a selection rate that is less than
four-fifths or 80% of the selection rate for the most represented group this can be used as evidence of discrimination or
adverse impact being present
again a selection rate for a protected class group, which is less than 4/5 or
80% of the rate for the group with the highest rate indicates adverse impact
So we must always ask the question is the percentage of a lesser represented group?
Equal to at least 80% of the percentage of the most represented group if yes
No evidence of adverse impact exists if no evidence of adverse impact in facts exists
There are five steps to determining adverse impact using the 4/5 rule
number one identify the policy or practice at issue
number two calculate the rate of selection for each group number three note which group has this highest selection rate
Number four calculate adverse impact ratios and number five use the test to determine if adverse impact exists
Let's take a look in detail
number one identify the policy or practice at issue
To demonstrate adverse impact a plaintiff the employee must show that a particular policy or practice on the part of the employer
results in a certain amount of discrimination towards a protected group
Therefore your first step should be to identify the selection requirement that is responsible for the differing rates of selection
by way of example
Let's use a requirement that a police officer in a particular city
Must be able to lift a hundred pounds to be selected for the job
To calculate the rate of selection for each group the next step in calculating adverse impact is to establish the
selection rates for each group of individuals
This is done for each group by dividing the number of applicants selected for the employment process by the total number of applicants
The selection rates will then be compared in a later step
returning to our example
Let's say 100 men and 100 women applied to be police officers in our hypothetical city
80 men and 60 women were selected for the position
So the selection rate for men would be 80 percent or 80 divided by
100 and the selection rate for women would be 60 percent or 60 divided by
103 note which group has the highest select right in this step of the process we determine which group has the highest rate of
Selection the rate will be used as the point of comparison on which
Determination of adverse impact can be made in our example men had the highest
selection rate for the police officer position at 80 percent
Step four calculate adverse impact ratios
Once you have calculated the selection rates and determined the group with the highest rate the next step is to determine the adverse impact ratio
for each group
This is how each group selection rate compares with the most represented groups rate of selection
This is done by comparing the selection rate for each group against that of the most represented group in our example
We divide the selection rate for women by the selection rate for men or 0.6
divided by 0.8 and arrive at an adverse impact ratio for female applicants of
75%
Only step 5 determine if adverse impact exists once you have calculated the adverse impact ratios for each group
evaluate each adverse impact ratio using the 4/5 rule
This is the simple part if the adverse impact ratio for a particular group is less than 80%
According to the 4/5 rule this can be used as evidence of adverse action
Basically this means that a member of the less represented group is selected for a position less than
80% of the time a member of the most represented group is selected for the same position
Returning to our example the impact ratio for female applicants is 75% which is less than 80%
Meaning that the policy of requiring
police officers to be able to lift at least a hundred pounds seems to have an adverse impact on female applicants to
Reinforce our understanding of the 4/5 rule let's take a look at a different example
So here's another calculation of 4/5 in this scenario
We have 80 white applicants of which 48 were hired there were 40 black applicants 12 of which were hired
the selection rate of white applicants is
48 divided by 80 or 0.6. Which is 60 percent white applicant our the group with the highest selection rate?
The selection rate for black applicants is 12 divided by 40 or 0.3
Which is 30% the impact ratio? Then is 0.3 divided by 0.6. Which equals 0.5 or 50%?
The impact ratio of 50% is less than 80%
Which is evidence based on the four-fifths rule that adverse impact exists
You can use this table and these simple steps to develop your own
analysis of whether adverse impact exists in a disparate impact case
