What does "Disparate Impact" refer to?

"Disparate Impact" refers to unintentional discrimination in hiring practices, which occurs when a policy or practice that appears neutral disproportionately affects a particular group based on race, gender, age, or other protected characteristics. This concept recognizes that even if there is no intent to discriminate, certain employment practices can lead to unfair outcomes for specific demographic groups.

For example, if a company implements a hiring test that is not job-related and results in significantly lower pass rates for a particular ethnic group, this would illustrate a disparate impact. The law considers these unintended consequences as a form of discrimination, which can lead to challenges in recruitment and retention of diverse talent.

Understanding this concept is crucial for organizations to ensure fair hiring practices and to promote equal opportunity in employment settings.