In the United States, Title VII of the Civil Rights Act of 1964 prohibits discrimination based on race, ethnicity, national origin, religion, or gender. The Equal Opportunity Commission (EEOC) monitors the hiring practices of air carriers to ensure that they comply with Title VII. The EEOC uses several guidelines to assess hiring procedures and their outcomes. One of these guidelines is the “four-fifths (4/5)” or ” 80%” rule.
The four-fifths rule might be applied in the following way. Assume that 15% of the qualified white male pilot applicants are hired and 9% of qualified Hispanic male applicants are hired. To meet the four-fifths rule, at least 12% of the qualified Hispanic male applicants should have been hired (15% x 80%; .15 x .8 = .12 or 12%). Because the hiring rate for the protected class is less than four-fifths that of white males, the EEOC may decide that the hiring process creates “adverse impact.” Note that the rule applies to the percentage of qualified applicants, not to the percentage of the specific protected class in the population.
The EEOC may apply the four-fifths rule to each part of the hiring system as well as to the system as a whole. For example, let’s assume that an air carrier has a selection system consisting of a computerized aptitude test, a simulator evaluation, and an interview with a senior check airman. Also assume that 20% of the qualified white male applicants are hired and 18% of the qualified women are hired. At first glance, this system appears to have no adverse impact for women because they are hired at more than 80% of the rate at which men are hired. However, when we examine each of the three components of the selection system separately, we find that 30% of the white male applicants pass the simulator evaluation while only 20% of the female applicants pass. In this case, the EEOC may decide that the hiring process has adverse impact because women are passing this stage of the selection process at less than 80% of the rate of the white male applicants.