Assignment 3: Evaluating Disparate Impact and Employee Selection

Note: There are 4 pages total to refer to for this first assignment. Make sure to read all 4 pages in this document.

You are employed as an HR consultant for a mid-sized bank. The bank employs 200 tellers across its branches. You need to recommend to the bank what to consider when hiring for the position of Bank Teller. At this point you have completed Assignment 2 and you have created a selection system for the job of a Bank Teller. Now you are moving to Assignment 3 to verify the selection system works properly.

For this second assignment there are two main tasks you need to complete:

• Assignment 3: Part A Evaluating Disparate Impact Discrimination

• Assignment 3: Part B Reflection on Employee Selection

Both tasks should be included in one document 2 to 5 pages in length, double spaced, use tables when needed, and use APA format for referencing and citing. Include a cover page and a reference page.

The following pages describe the rubric that will be used to measure your work and detailed instructions for completing this assignment.

Part A: Evaluating Disparate Impact Discrimination

Evaluating the Selection System

You have now created a selection system for the job of a teller.

The final step in a selection system is to make sure the system works properly.

As discussed in the overview, there are two ways to ensure that the system is working. One approach takes a legal perspective to ensure that organizations do not discriminate in hiring.

There are two types of discrimination: disparate treatment and disparate impact (also known as adverse impact). Disparate treatment discrimination refers to treating applicants differently based on a protected characteristic (for example, age, sex, national origin, religion). An example of disparate treatment discrimination is not considering women for leadership positions. This type of discrimination is considered intentional and therefore easy to identify and correct or prevent.

Disparate impact discrimination is considered unintentional. This form of discrimination indicates that all applicants were treated equally; however, this equal treatment had an unequal effect related to a protected characteristic. The most common approach to identify adverse impact is to apply the four-fifths rule. The fourfifths rule states that adverse impact exists if the selection ratio of the minority group is less than four-fifths (or 80 percent) of the selection ratio of the majority group. A selection ratio is the percentage of those hired based on the percentage of those who applied for the job. Selection ratios must be calculated for each protected group. The selection ratio of the minority group is compared with the selection ratio of the majority group (often "males" or "Caucasians"). The simplest way to calculate adverse impact is to divide the selection ratio of the minority group by the selection ratio of the majority group. If the result is less than 80%, then adverse impact exists.

For example, the bank collected the following data over the past five years:

Males applied = 200 Females applied = 300 Males hired = 40 Females hired = 45

Based on this information, the selection ratio for men is 20% (40/200), whereas the selection ratio for women is 15% (45/300). Dividing the minority group (the group with the lower selection ratio, women) by the majority group (in this case, men) results in an answer of 75% (15%/20%). Since the result is less than 80%, adverse impact exists. The organization needs to explore the selection process to identify what may be the cause of this disparity. In this part of the exercise, you will conduct this analysis.

The bank compiled selection data on three racial groups during the past year: Caucasians, African-Americans and Latinos. The data is as follows:

1. The selection ratios for the three groups are:

Caucasians = African-Americans = Latinos =

2. Does adverse impact exist when you compare the African-American applicant pool with the Caucasian applicant pool? Show your work.

3. Does adverse impact exist when you compare the Latino applicant pool with the Caucasian applicant pool? Show your work.

Part B: Reflection on Employee Selection

1. You have made a number of decisions in creating, implementing and evaluating a selection system for bank tellers. Which of these decisions do you think is most critical? Why?

2. An employee selection approach to hiring is more complex than hiring employees based on who they know or casually scanning a résumé and asking a few "off the cuff" questions for an interview. When you think about your work experiences, do you think the organizations you worked for took an employee selection approach when hiring?

3. If you answered yes to question 2, do you think the organization was effective in hiring employees? If you answered no to question 2, do you think the organization should have adopted a selection approach to hiring?Explain your response.

4. What do you perceive as the overall advantages and disadvantages of an employee selection approach to hiring?

5. Based on this exercise, would you recommend an employee selection process to hiring for virtually any job? Why or why not?

6. Describe the components of an employee selection process in order to reflect on the fundamental aspects of employee selection your learned from completing Major Assignments 1, 2 and 3. The answer to question 6 should be 2-3 pages long in order to be complete and thorough.