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Disparate Impact – How To Avoid It In A Business Organization?

Disparate Impact – How To Avoid It In A Business Organization?

Disparate Impact - How To Avoid It In A Business Organization_

To create a healthy work culture within an organization, it is important to get rid of disparate impact situations in the workplace. To attract the best talent in the organization and to avoid any legal consequences, it is important to stop the disparate treatment of employees. However, here we will need to understand the difference between disparate impact and disparate treatment of employees.

In this article, you will have a general idea of what disparate impact means and how it differs from disparate treatment of employees within an organization. Furthermore, we shall also discuss how and when disparate impact happens within an organization, as well as the major consequences of it. Finally, we will show you ways to identify and eliminate disparate impact at the workplace.

Disparate Impact Vs Disparate Treatment: What is The Difference?

Disparate Impact Vs Disparate Treatment_ What is The Difference_

Both disparate impact and disparate treatment sound similar in the first instance. However, there is a big difference in the meaning of the two terms provided here. Basically, disparate treatment pertains to intentionally discriminating against employees within an organization.

According to Indeed.com,

Disparate treatment, also known as adverse treatment, occurs when an employer treats an employee unfairly compared to other employees based on the person’s personal characteristics, especially with regard to protected classes.”

For example, a hiring department of an organization can refuse even to consider people from a particular ethnicity, which shows disparate treatment of these candidates and employees.

On the other hand, disparate impact means that there are certain policies and practices within the organization that appear neutral from the outside but can have an adverse effect on a protected class of employees. It mostly happens when a particular organization tries to protect and treat all its employees in a fair manner.

Disparate Impact – When And How Does It Happen?

Disparate Impact – When And How Does It Happen_

There are situations, no matter how much effort you make as a hiring manager or an HR, you can be unfair to particular groups of people within your organization. If you want to eliminate the unfairness in the treatment of these groups, it is important for you to recognize the various adverse impact associated with it.

According to TestGorilla.com,

Disparate impact is an unintentional action or policy that leads to the discrimination of a group of individuals. Disparate impact can sometimes be justified if it’s related to the requirements of a specific position.

However, you will need to understand here that, in most cases, the disparate impact in the organization is not directly related to the needs of the business. It can lead to the creation of a certain workplace environment that is not fully supportive and welcoming. Furthermore, it can worsen the situation of the organization by impacting the performance of different teams of the entire organization.

Disparate impact can lead to unintentional harm to an employee within an organization. To make sure that these harms do not occur to the employees, many states in the USA have passed laws like “ban the box.” These laws tell employers to hold off asking about any criminal history in the application process of a candidate.

Major Consequences Of Disparate Impact

Major Consequences Of Disparate Impact

Disparate impact can happen in certain situations within a business organization. According to Insperity.com,

When organizations don’t evaluate their policies and practices for their impact on protected groups at each stage of the employee life cycle, they may create disparate impacts at any point from the application process through promotions and layoffs.”

One such application stage practice is that which requires candidates to share their salary history. It creates a disparate impact, which can follow the employee throughout his/her career and limit the lifetime earning of the employee as a result.

Furthermore, many employees, as they move up to higher levels as leaders in the organization, might face different kinds of disparate impact situations. Some of these practices are driven in the organization by structural bias or any unconscious bias. An example of this situation is that an employee is discriminated against for not having the look of a leader because of his physical features.

Hence, it can be seen that disparate impact can damage the employee experience for those people that are affected in the organization. Disparate impact can not only undermine the organization’s diversity but can also impact the turnover, inclusion efforts, and recruitment efforts as well.

Ways To Identify And Eliminate Disparate Impact At The Workplace

Ways To Identify And Eliminate Disparate Impact At The Workplace

Insperity.com rightly puts out that disparity impact can heavily affect the work processes of an organization, as they say –

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Because disparate impact affects entire groups of workers, it can create systemic inequities that affect many people in your organization. That impact can lead to legal consequences like class-action lawsuits, even if the discrimination is unintentional.”

The following are the steps that you can take to identify and eliminate the disparate impact within your organization:

1. Start to conduct objective job analyses for every position in the organization. Ensure that the job requirements are necessary for the performance of the job. You can then be able to get an idea of whether the job requirements provided are true to the job in reality.

2. You can post about a job position on a variety of job search sites to avoid disparate impact. This can help you to get access to a diverse pool of candidates instead of getting candidates from one or two sources.

3. Ensure that you collect all the data from the applicants, store them properly, and analyze them minutely. You can also use an application tracking system to track the records of candidates. You can then have a better idea of why someone was selected, and someone was not.

4. You can also get a better idea of your workforce analytics. You can have a better idea of employees that are underrepresented or the ones that are overrepresented in situations of layoffs.

Bottom Line

Hope this article was helpful for you in getting a better idea of what disparate impact is and how it affects workflow in the business. Follow the necessary recommendations that we have provided to slowly eliminate disparate impact from your company. Share your further recommendations regarding the elimination of disparate impact from the workplace in the comments section below.

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