Maintaining a Positive and Productive Workplace in 2024:  Considerations When Using Artificial Intelligence in Employment Decisions

According to a 2022 study by the Society for Human Resource Management, nearly one in four organizations reported using automation or AI to support HR-related activities.  According to the study, while AI is being used in a myriad of employment decisions, the greatest use by far is in recruiting and hiring.

With this rise in the use of AI in employment decisions, regulators and law makers are turning their attention to ensuring that AI is used in a fair and responsible way that does not violate any laws aimed at protecting the rights of employees.

The EEOC is expanding its focus on AI in 2024.

As was noted in last week’s “Maintaining a Positive and Productive Workplace in 2024” blog post, one of the U.S. Equal Employment Opportunity Commission’s (“EEOC”) focuses announced in its Strategic Enforcement Plan for 2024 to 2028 is the use of AI in recruitment and hiring.  The concern is that the use of AI could intentionally or unintentionally lead to discriminatory practices in recruitment or hiring.  For example, if an AI algorithm was programed to screen out applicants over a certain age, that could constitute intentional discrimination.  Or, even if an algorithm was carefully programmed to avoid any discriminatory screening factors, it still might inadvertently screen out, for example, those with disabilities and therefore have an unlawful, discriminatory disparate impact.

This 2024 focus is a continuation of the EEOC’s scrutiny of and guidance surrounding use of AI in employment decisions.  In 2021, the EEOC launched its Artificial Intelligence and Algorithmic Fairness Initiative, aimed at ensuring that the use of AI and other emerging technologies used in hiring and other employment decisions comply with federal civil rights laws.

In May of last year, the EEOC released a technical assistance document, “Assessing Adverse Impact in Software, Algorithms, and Artificial Intelligence Used in Employment Selection Procedures Under Title VII of the Civil Rights Act of 1964.”  This document includes guidance in the form of questions and answers, including:

“3.     Is an employer responsible under Title VII for its use of algorithmic decision-making tools even if the tools are designed or administered by another entity, such as a software vendor?

In many cases, yes. For example, if an employer administers a selection procedure, it may be responsible under Title VII if the procedure discriminates on a basis prohibited by Title VII, even if the test was developed by an outside vendor. …”

Law makers are beginning to propose legislation regarding the use of AI in employment decisions.

In July of 2023, U.S. Senators Bob Casey (D-PA) and Brian Schatz (D-HI) U.S. Senator Bob Casey introduced the No Robot Bosses Act aimed at protecting and empowering workers by preventing employers from relying exclusively on artificial intelligence in making employment decisions. On July 20, 2023 the bill was referred to the Committee on Health, Education, Labor, and Pensions and no further action has been taken on it at this time.

Illinois and New York City have implemented legislation governing the use of AI in employment decisions, and more states and cities are proposing such legislation.  For a comprehensive look at 2023 state legislation proposed on a myriad of topics related to AI see the National Conference of State Legislators’ summary on Artificial Intelligence 2023 Legislation.

What does this mean for the use of AI in employment decisions?

The use of AI saves time and money and is a valuable tool for many companies.  No doubt the new and even more efficient and effective methods of using AI will expand over time and bring great benefits to the workplace.  It is important, however, to consider not only the benefits and efficiencies of using AI, but also the potential pitfalls, how to avoid them, and how to craft fair, unbiased, efficient, and effective AI employment tools.

Some practical advice to companies to ensure that their use of AI promotes a positive, productive, and lawful workplace includes:

  • Carefully select your AI vendor and inquire into the vendor’s knowledge regarding and practices for avoiding discriminatory selections processes.
  • Assess each AI tool to make sure it does not include any discriminatory selection factors.
  • Assess whether the AI selection procedure has an adverse impact on a particular protected group.
  • Continue to assess your AI tools on an ongoing basis.
  • Carefully determine which positions or decisions are appropriate for the use of AI tools and which are not.
  • Do not make employment decisions solely based on AI. Have qualified personnel review the results of the AI process.

As this emerging area of the law develops, it will be important to stay up-to-date on any new laws or regulations applicable to your company that address the use of AI in employment decisions.