In a 2019 survey Littler conducted of over 1,300 in-house counsel, HR professionals and C-suite executives, more than 35% responded that their organization is using artificial intelligence (AI) in the recruiting and hiring process.1 Employers can take advantage of a growing range of AI-based methods of talent assessment, which includes AI-driven review of resumes, algorithm-based reviews of applicants’ responses to test questions, and algorithmic analysis of applicants’ publicly available social media content. A growing number of employers are turning to yet another talent assessment tool: AI-powered video-interview platforms that apply algorithms to video-recorded interviews to facilitate an employer’s assessment of an applicant.

To address this use of AI, on August 9, 2019, Illinois enacted the Artificial Intelligence Video Interview Act (AI Interview Act).2 The AI Interview Act is the first U.S. law to establish a framework for employers’ use of AI in the hiring process. That framework is based on prior notice to applicants “based in Illinois” and the requirement to obtain their affirmative content to participate. The notice must (a) inform applicants that “artificial intelligence analysis” may be used to evaluate their application, and (b) explain how the AI analysis works and “the general types of characteristics” used to evaluate the applicant. The Act also restricts disclosure of the video interview to anyone other than “persons whose expertise or technology is necessary in order to evaluate an applicant's fitness for a position” and requires employers to ensure that all copies of the video interview, whether in the possession of the employer or any third party, are destroyed within 30 days of an applicant’s request.

In its brevity, the AI Interview Act leaves a number of questions unanswered. To begin with, “artificial intelligence analysis” is not defined. Second, while the Act, by its plain terms, protects applicants “based in Illinois,” it does not specifically state whether it purports to regulate out-of-state employers, particularly when they are hiring for a position located outside of Illinois. Third, the Notice Requirement provides only a very high-level description of the mandatory content for the notice. Fourth, the Act does not establish an express exception from the deletion requirement for circumstances where the employer is required by law to retain the video interviews. Finally, the Act is silent on enforcement, which raises a question as to whether applicants can recover statutory damages for violations.

Employers have understandably grappled with these questions since the Act’s passage last month. Below are five considerations to help employers comply with and use the new law:

1. Employers that use a service provider to perform video-recorded interviews should determine whether the service provider performs AI analysis of the recordings and, if so, consider amending their service agreements.

The AI Interview Act’s broad reference to “artificial intelligence analysis” arguably brings many uses of AI on video-recorded interviews within the law’s purview. Several companies now offer pre-employment assessment of applicants by analyzing video-recorded interviews, but not all use AI technology. Employers that use video-interview platforms must therefore determine whether their service provider is using AI, in any way, to evaluate applicants.

For employers that are using AI-powered interview platforms, whether provided through a service provider or internally hosted, the employer must comply with the Notice Requirement. Of note, the AI Interview Act does not specify a form that the notice to applicants should take. To help reduce risk, employers should consider conveying a clear and conspicuous notice to each applicant. Employers also should ensure that they or their service provider has established a mechanism for obtaining and documenting applicants’ consent and for retaining that documentation.

An employer should consider addressing in its service agreement with the service provider a range of issues the Act raises. These matters include, for example: (a) designating which party is responsible for conveying the notice to applicants and obtaining and documenting consent; (b) prohibiting the service provider’s use of the video interview other than to provide services to the employer; (c) prohibiting the service provider’s re-disclosure of the video interviews to third parties and restricting internal disclosure to those involved in the AI analysis; (d) requiring the service provider to timely cooperate with the employer to fulfill deletion requests; and (e) indemnifying the employer from applicants’ claims based on the service provider’s failure to comply with the Act.

2. The AI Interview Act does not affirmatively require employers to make an alternative interview method available to applicants who do not consent to AI-analyzed video interviews, but employers should balance the risk of doing this.

While the AI Interview Act requires employers to obtain consent from applicants in order to use AI, the law does not affirmatively require employers to interview applicants who do not wish to have AI used during the interview process. Employers that have transitioned to a video-interview-based platform that involves AI analysis arguably could, therefore, choose to continue utilizing that interview method without exception. However, employers still may want to consider providing a non-AI alternative to avoid losing potentially more qualified applicants who decline to consent, and may be required to do so under the Americans with Disabilities Act for certain disabled applicants. Providing a non-AI alternative would also address any concern that the consent is not voluntary since otherwise the applicant would be rejected for failing to consent.

3. Employers that use AI-analyzed video interviews should ensure that they understand the functionality of the AI and explain the AI to applicants in easy-to-understand terms to comply with the Act’s mandate and avoid consent-related issues.

Under the AI Interview Act, employers must “provide each applicant with information before the interview explaining how the artificial intelligence works and … general types of characteristics it uses to evaluate applicants.” This is a mandate intended to make the use of AI more understandable to the applicant and likely more acceptable. Additionally, the applicant specifically consents “to be evaluated by the artificial intelligence program as described in the information provided.” Based on this language, employers that do not accurately describe the functionality of the AI technology to applicants could face claims that the consent is not valid.

Key to explaining the AI technology is understanding exactly how the technology works, particularly “the general types of characteristics” used to evaluate the applicant. For example, some video-interview platforms can analyze applicant’s facial expressions. Employers should determine whether this analysis involves the scan of the applicant’s facial geometry, as this could trigger additional obligations for the employer under Illinois’ Biometric Information Privacy Act.

4. Employers should consider developing a work-flow process for destroying video-recorded interviews in response to applicant requests consistent with other legal requirements.

As noted above, the AI Interview Act does not create any exceptions to the requirement to destroy video interviews within 30 days of an applicant’s request, but employers should do so based on other legal requirements. For example, the Equal Employment Opportunity Commission (EEOC) requires that private employers retain hiring-related records for one year from the date of making the record or of making the personnel action involved—whichever occurs later. Also, the Office of Federal Contract Compliance Programs (OFCCP) requires large federal contractors to retain “interview notes” for a minimum of two years. An employer that receives a destruction request within a year of an interview video’s creation could rely on these requirements to deny the request. Similarly, where an employer has issued a litigation hold that covers a video interview, complying with the AI Interview Act’s 30-day requirement will not be possible.

Employers that use service providers to perform AI-analyzed video interviews should also ensure that their service agreements give the employer the right to request deletion of any recordings, and require that the service provider delete the recording within a set time period from the employer’s request.

5. At least one federal agency has issued guidance that addresses the use of AI in the hiring process.

The OFCCP has issued guidance explaining that the use of AI to screen employment candidates could trigger obligations under the Uniform Guidelines on Employee Selection Procedures.3 According to the OFCCP’s guidance, if an employer’s use of an AI-based selection procedure results in an adverse impact on a particular racial or ethnic group or sex, the evaluation procedure may require further OFCCP scrutiny.

The risk of using AI in the interview process is not limited to federal contractors subject to the OFCCP’s oversight. Many preexisting employment and labor laws apply to AI-analyzed video interviews. Any employer that utilizes AI in its hiring process must ensure that the algorithm applied by the technology does not result in a discriminatory adverse impact on any protected class.

Conclusion

The AI Interview Act is a harbinger of both the growth of AI-powered Human Resource services and regulatory trends. As employers expand their use of AI in the recruiting process, they are certain to see more laws regulating its use. In addition, employers should watch for regulations, case law, and agency guidance addressing the use of AI for talent assessment.