The company gives Bob a verbal warning but fires Maria. Both employees committed the same violation, but they have been treated differently. Unless the employer can prove there was a justifiable reason why Maria was fired but Bob wasn't, then this would be a clear example of disparate treatment.
Disparate treatment occurs when a lender treats a credit applicant differently based on one of the prohibited bases under FHA and/or ECOA. It does not require any showing that the treatment was motivated by prejudice or a conscious intention to discriminate against a person beyond the difference in treatment itself.
Examples of lending discrimination include: Denying a mortgage or charging a higher interest rate because the property is located in a majority-minority neighborhood.
For example, if a lender refuses to make a mortgage loan because of your race or ethnicity, or if a lender charges excessive fees to refinance your current mortgage loan based on your race or ethnicity, the lender is in violation of the federal Fair Housing Act.
Disparate impact adversely and negatively affects a protected group or class even though a policy or practice is prima facie applied equally to all customers or applicants. Disparate treatment stems from inappropriate administration of such a policy, which benefits certain customers while unfairly injuring others.
Overt Evidence of Disparate Treatment.
There is overt evidence of discrimination when a lender openly discriminates on a prohibited basis. Example: A lender offered a credit card with a limit of up to $750 for applicants aged 21-30 and $1500 for applicants over 30.
Comparative disparate treatment happens when a business has a history of denying service to people who belong to a certain group. An example would be a nail salon that refuses to give spa services to disabled people.
Both disparate impact and disparate treatment refer to discriminatory practices. Disparate impact is often referred to as unintentional discrimination, whereas disparate treatment is intentional. The terms adverse impact and adverse treatment are sometimes used as an alternative.
This can include race, gender, age, religion, national origin, disability, and more. Examples include biased hiring practices, unequal pay for equal work, or imposing stricter disciplinary actions on certain employees due to their protected status.
For example, a loan officer who tells a coworker that women are worse at repaying debt than men are, so the loan officer charges a higher rate of interest based on a female applicant's gender has committed overt discrimination. That would be discriminatory on its face.
If an employee makes a claim of disparate treatment against his employer, it means that he believes that his employer has discriminated against him based on his membership in a protected class (race, religion, gender, national origin, sexuality, disability or other “difference”).
Making a prima facie case
With federal disparate treatment claims under Title VII, employees do have the initial burden of proof. This means you must show that: You belong to a protected class – that is, you're protected from discrimination on account of your race, color, national origin, religion or sex.
Refusal to hire: An employer would be in violation of disparate treatment if they choose to discriminate against a protected class. An example of this is when a CV is dismissed from the consideration pool because the name on the CV suggests a non-white-sounding name.
The four-fifths rule is a guideline used to determine if there is adverse impact in the selection process of a specific group. The rule states that the selection ratio of a minority group should be at least four-fifths (80%) of the selection ratio of the majority group.
Some of the most common types of disparate treatment claims include failure to hire, poor employment conditions, and termination. For example, a settlement was reached between the game development company Activision Blizzard after several women had been subjected to sexual harassment or pregnancy discrimination.
Your employer segregates different areas of your workplace by religion or race; Your employer excludes same-sex couples from work parties; Your employer demotes pregnant women or refuses to hire pregnant workers; or. Your employer makes it difficult for disabled workers to complete their job duties.
Discrimination at work
Discrimination happens when an employer treats an employee or job applicant unfairly because of their race, color, religion, sex, national origin, age (40 or older), disability, or genetic information. EEOC laws do not cover all employers. Coverage is often based on the number of employees.
Students classify those characteristics based on the three C's of credit (capacity, character, and collateral), assess the riskiness of lending to that individual based on these characteristics, and then decide whether or not to approve or deny the loan request.
Three lending discrimination types
Disparate treatment: Refusing to offer the same options or treatment to borrowers because of a protected characteristic. Disparate impact: Operating according to policies that have a negative impact on people with protected characteristics, whether that outcome was intended or not.
These three pillars are the keys to effective credit analysis and can also be referred to as the 3 P's: Policies, Process and People. Policies (or procedures) refer to the overall strategy or framework that guides specific actions. Loan policies provide the framework for an institution's lending activities.
For example, if a job applicant believes a potential employer discriminated against them because of their race, the employee will typically need to be able to show the following in order to establish a prima facie case of racial discrimination: The applicant is a member of a protected class.
The most popular and accepted methods of self-testing are pre-application inquiries or mystery shops in the form of Matched Pair Testing and Monadic Testing and Post-application customer surveys.
This Act (Title VII of the Consumer Credit Protection Act) prohibits discrimination on the basis of race, color, religion, national origin, sex, marital status, age, receipt of public assistance, or good faith exercise of any rights under the Consumer Credit Protection Act.