The Wage and Hour Division (WHD) of the U.S. Department of Labor (DOL) recently issued Field Assistance Bulletin No. 2024-1, entitled “Artificial Intelligence and Automated Systems in the Workplace under the Fair Labor Standards Act and Other Federal Labor Standards.” The bulletin originated from an October 2023 executive order that called for a coordinated federal government approach to the responsible and safe development and use of artificial intelligence (AI).

This guidance reminds employers that they must observe federal labor standards even as they adopt AI technology or other automated systems in the workplace. More specifically, the bulletin addresses the use of AI in conjunction with the Fair Labor Standards Act (FLSA), the Family and Medical Leave Act (FMLA), and other federal labor laws.

AI can be useful in the workplace to automate employer functions, such as tracking employee work hours, screening applications for employment, setting work schedules, measuring employee performance, and performing other HR-related tasks. However, without proper human supervision, AI can potentially create risks for workers regarding violations of the labor laws that the DOL enforces. AI can result in system labor law violations that employers must be aware of and take proactive measures to avoid.

AI and FLSA

The DOL’s bulletin addressed AI technologies that may affect rights under FLSA, including those that track worker hours, monitor worker productivity, and calculate wages owed. For instance, some AI programs measure worker productivity in real time based on workers’ keystrokes, mouse clicks, application use, web browser usage, and web camera presence.

However, the DOL pointed out that overreliance on purely automated worker tracking mechanisms, combined with little to no human oversight, can result in potential problems with FLSA compliance. AI technologies may undercut employees’ actual hours, especially when they work in multiple locations, utilize break times, and have periods where they are waiting for work or further engagement. Similarly, relying solely on algorithms to ensure that workers are accurately paid, including their regular rates and overtime premiums, may not always be correct. Again, human oversight is necessary to ensure that the AI program is accurately accounting for the full amount of a worker’s wages.

AI and FMLA

Likewise, employers must comply with FMLA regardless of whether they use automated or manual systems to track employee leave time. While AI is useful for tracking and processing employee leave requests, employers must ensure that their systems accurately allow employees the full amount of leave to which they are entitled. AI systems are also more likely to be insufficient when determining eligibility under FMLA and federal leave laws, calculating the amount of leave entitlement, and determining qualifying reasons for leave. Therefore, employers must always personally oversee using AI systems to track and process leave requests to maintain compliance with federal law.

HBL has experience in all areas of benefits and employment law, offering a comprehensive solution to all your business benefits and HR/employment needs. We help ensure you are in compliance with the complex requirements of ERISA and the IRS code, as well as those laws that impact you and your employees. Together, we reduce your exposure to potential legal or financial penalties. Learn more by calling 470-571-1007.