An adverse impact results from employer practices that seem to be neutral but that disproportionately and negatively affect protected groups such as women and minorities. It is possible for an adverse impact to occur at any stage of the employment process, with stages including hiring, training, performance reviews, promotions and layoffs. A practical means of measuring if an adverse impact exists is to evaluate whether a group’s selection rate falls below 80 percent of the group that has the highest selection rate. For example, if you give a hiring test for job applicants, and the pass rate of a protected group is 80 percent of the pass rate of the group with the highest selection rate, the hiring test may have an adverse impact on that protected group.
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