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This Employment Law This Week Deep Dive episode looks at the role of artificial intelligence (AI) in human resources (HR) functions. Today, we’re seeing HR functions that are trying to harness the power of data and use it in predictive ways to hire the best candidates for a job. Attorneys Adam Forman and Nathaniel Glasser of Epstein Becker Green discuss how AI technology can be applied to business operations and HR functions, the benefits of AI technologies for HR, the legal risks inherent in some of the AI processes that are available, and the importance of working with legal counsel when implementing AI.
Read on for more about this episode:
1. Artificial Intelligence in Human Resources
We typically think about AI as robotic manufacturing or number-crunching data analysis, but companies are also starting to deploy AI for HR functions.
“There are many ways that AI technology can be applied to business operations and human resources functions. Two of the primary ways are in the pre-employment phase and during employment. For pre-employment, there's software that will assist with identifying and selecting candidates for employment. During employment, we see AI being used to track training of employees, to identify an employee's career progression, or even with something called a chatbot, which would take over certain lower-level HR functions, such as tracking one's paid leave. Of course, AI technology can also be used in pay equity audits for employers, as well. At the outset, these technologies tend to be more efficient because they're automated and they're scalable, they predict rather than describe, and they improve the overall candidate experience.”
2. Associated Legal Risks
AI for HR can generate significant costs savings while improving service. But it also creates new legal risks for companies that utilize it.
“It's important that employers don't blind themselves to the legal risks that are inherent in some of the AI processes that are available. And that means making sure that disparate treatment and disparate impact claims and the potential for those claims are limited in conducting an early review, and also making sure that people with disabilities can be accommodated and they can be treated equally when they're evaluated by these AI technologies. It's important for organizations to work with their legal counsel when implementing AI, and that's because employment lawyers, for instance, are familiar with the uniform guidelines on employee selection procedures and understand the validation methodologies that are necessary to get from start to finish. And anytime an adverse impact analysis is conducted, it can be done under attorney-client privilege.”
3. Making AI Work for HR
AI for HR can make a lot of sense. Some companies have seen a 25-30 percent reduction in HR costs by utilizing technology. If you make the leap, though, it’s important to keep your eyes open to the legal risks and make sure that you’re implementing AI in a compliant way.
Stay tuned for further developments that may affect your business.