Adverse Impact Calculator
How do you calculate adverse impact with the four-fifths rule?
Divide each group's selection rate by the highest group's rate. Below 80% the rule treats it as adverse impact worth investigating. On the figures here, 40 of 100 is 40% and 12 of 50 is 24%, a ratio of 60% — and four more selections would have cleared it. It is an enforcement rule of thumb, not a legal test.
The four-fifths rule is exact arithmetic, and almost no small employer has ever run it on their own hiring.
Put in how many people applied and how many were selected, for each group. It does the rest.
Built by Muhammad Shahzeb Anwar, MSc Industrial and Organizational Psychology, who also writes the paid version of this tool. Clearing the ratio is not a defence and failing it is not a finding, and this page says both.
Selection rates and the four-fifths ratio
Leave a group blank to ignore it. Groups too small to be stable are shown and excluded from the verdict.
What the four-fifths rule actually says
Work out the selection rate for each group - the number selected divided by the number who applied. Find the group with the highest rate. Divide every other group's rate by that one.
If any group comes out below 80% - four fifths - the rule treats that as a sign of adverse impact worth investigating.
That is the entire method. It needs no statistics package and no consultant, which is what makes it so odd that most small employers have never run it on a single hiring round.
What it is not
It is an enforcement rule of thumb from the Uniform Guidelines, used to decide where to look. It is not a legal test and this page is not legal advice.
Clearing 80% is not a defence: a process can pass the ratio and still be doing something a court would take an interest in. Failing it is not a finding of discrimination either - it is a reason to examine the step in your process that produced the difference.
The ratio also says nothing about why the rates differ. That answer is in your process, not in this arithmetic.
Why small groups are excluded from the verdict
With twelve applicants in a group, one hiring decision moves the selection rate by more than eight points. A ratio built on that is precise-looking noise.
This tool shows those groups so you can see the figures, and keeps them out of the conclusion. The floor is adjustable, but moving it does not make a small group stable.
What this will not tell you
This is arithmetic, not a compliance check. It makes no claim about any obligation you may have, it cannot tell you whether your process is lawful, and it is not legal advice. It also cannot see which step of your hiring produced the difference - which is the only question worth answering next.
Questions people actually ask
What is the four-fifths rule?
Divide each group's selection rate by the highest group's selection rate. If the result is below 80%, the rule treats it as a sign of adverse impact worth investigating. It comes from the Uniform Guidelines and is used to decide where to look, not to decide a case.
Does failing the four-fifths rule mean I have discriminated?
No. It is a screening rule of thumb. Failing it is a reason to examine the step in your process that produced the difference; clearing it is not a defence either.
How do I calculate a selection rate?
Divide the number of people selected from a group by the number who applied from that group, then multiply by 100. The four-fifths ratio then compares each of those rates against the highest one.
Why does it refuse to judge small groups?
Because with a handful of applicants, one decision moves the selection rate several points. The tool shows those groups but keeps them out of the verdict, so a precise-looking ratio built on noise does not become a conclusion.
Cite this tool
Free to use and free to quote. If a figure here is useful in something you are writing, a link back is all that is asked.
Muhammad Shahzeb Anwar, MSc Industrial and Organizational Psychology. Adverse Impact Calculator (Four-Fifths Rule). Shahzeb Speaks. https://www.shahzebspeaks.com/adverse-impact-calculator-free-tool/
The other free tools
Each one answers a single question and refuses the ones it cannot. All free, none asks for an email address.
Running this across a whole hiring process?
The paid Adverse Impact Calculator handles more groups, keeps the record so you can compare rounds, and carries the same refusal to name a group the count could not support. It is part of a set of hiring tools that all draw the same line on sample size.
See the full tool