Question & Answer: Is 20% / 30% / 30% less than 80% (the 4/5th adverse rule)?…..

Yes, 20% = 0.2, 30%= 0.3

20% / 30% / 30% = 0.16/0.3 = 16/30 = 0.5333 which is less than 0.8.

Typically, adverse impact is determined by using the four-fifths or eighty percent rule. The four-fifths or 80% rule is described by the guidelines as “a selection rate for any race, sex, or ethnic group which is less than four-fifths (or 80%) of the rate for the group with the highest rate will generally be regarded by the Federal enforcement agencies as evidence of adverse impact, while a greater than four-fifths rate will generally not be regarded by Federal enforcement agencies as evidence of adverse impact.” Since the 80% test does not involve probability distributions to determine whether the disparity is a “beyond chance” occurrence, it is usually not regarded as a definitive test for adverse impact. Instead, other statistically significance tests, such as the standard deviation analysis, may be used for this purpose.