The Standard Deviation Analysis/Chi Square Test

The standard deviation analysis looks at the difference between the proportion of the protected class selected, promoted or terminated and the proportion of all applicants or employees selected, promoted, or terminated.  This difference has a normal distribution with a mean and standard deviation. 

The Chi Square test measures whether there is a significant difference between categorical independent variables (non-minority/minority or male/female) on a categorical dependent variable (hires, promotions, terminations).  Where the standard deviation is greater than two, there is typically evidence of bias in the Chi Square test.

If the protected group shows a proportion that is more than two standard deviations, then it is generally considered significant and will be investigated by OFCCP.

Workplace Dynamics conducts the Adverse Impact, Standard Deviation, and Chi Square Analyses for all applicants, hires, promotions, and terminations (voluntary and involuntary) to support your Affirmative Action Plan or as a quarterly or semi-annual audit tool.  We present the results to you in an easy-to-understand manner.  Where there is evidence of potential problem areas, we arm you with the appropriate information, including comparative data, to direct your self-audit process.