Final answer:
The 80% or four-fifths rule is utilized to analyze employment practices for potential discrimination by comparing selection rates across different demographic groups where rates less than 80% indicate a need for further investigation.
Step-by-step explanation:
The 80% or four-fifths rule is a guideline used in the analysis of employment decisions to determine if there is evidence of potential discrimination. The rule states that a selection rate for any race, sex, or ethnic group which is less than four-fifths (or 80%) of the rate for the group with the highest selection rate is considered evidence of adverse impact, although it is not definitive proof of discrimination. This guideline is used in human resources and by organizations to ensure compliance with the U.S. Equal Employment Opportunity Commission (EEOC) guidelines.
For instance, if a company hires 20% of its male applicants and only 12% of its female applicants the selection rate for women is 60% that of men (12% divided by 20%). Since 60% is less than 80%, this would trigger further investigation under the four-fifths rule to determine if discrimination is present.