The use of AI in hiring and employment contexts has become a special area of interest for U.S. state legislatures in recent years. Does your business utilize AI solutions for recruiting, hiring, or other HR-related functions? Are these teams planning on implementing such technologies to increase efficiency?
Several states have enacted laws specifically regulating the use of AI in these contexts. Human resources and hiring teams need to ensure that current and planned AI use is understood and that new legal risks are identified and addressed.
For example, AI tools are quickly emerging that can help sift, sort, and score candidate resumes, cover letters, and other materials and which purport to save recruiting departments hours of tedious review. Though these may not seem like “cutting-edge” applications of AI, even these practices may trigger requirements to, for example, perform AI bias assessments, draft and post notices, and/or perform risk assessments. Regulation may also extend to use of AI interview bots or using AI to score candidates or make recommendations for internal promotions.
Below, we provide a high-level summary of certain AI laws with potential impacts on human resources applications. Note that the information below is meant as a general description only and each law listed contains more detail than is reflected here:
- NYC Local Law 144 and implementing Final Rule – Prohibits employers and employment agencies from using AI for automated employment decisions in New York city unless they ensure an adequate bias audit was performed and have provided notices to applicants. Note that the Final Rule provides significant additional requirements and is extremely detailed (even including equations that must be used to evaluate impact ratios).
- Illinois HB 3773 – Requires employers to notify employees when AI is being used in connection with employment decisions. Prohibits employers from using AI in connection with certain activities in a way that subjects an employee to discrimination.
- Illinois HB 2557 (Artificial Intelligence Video Interview Act, as amended) – Requires disclosures to applicants when AI is used by employers to analyze video interviews. Employers that rely solely on AI to determine whether an applicant will qualify for an in-person interview must gather and report certain demographic information to the Illinois Department of Commerce and Economic Opportunity.
- Maryland HB 1202 – Prohibits employers from using certain facial recognition services during an applicant’s interview for employment without applicant consent.
- California Regulations under the Fair Employment and Housing Act –The regulations make it unlawful for an employer to use any “Automated-Decision Systems” (ADS) for discriminatory purposes and provide that the presence and quality of bias testing may be evaluated as evidence in any related claim. Covered employers must keep relevant ADS records for at least four years. Provides that employers may be liable for vendor or other third-party use of ADS tools on the employer’s behalf.
In addition to these AI-specific hiring and employment laws, these technologies may trigger obligations under the Colorado AI Act as a “high-risk” AI system involved in “consequential decisions,” under California’s CCPA as an “automated decision-making technology” involved in “significant decisions,” and under other state comprehensive privacy laws regulating certain “profiling” activities.
If your business has deployed or plans to deploy AI tools in any aspect of recruiting, interviewing, or hiring technologies or processes, consider engaging legal counsel with the AI expertise necessary to assess applicability and to help develop compliance strategies. The Taft Privacy, Cybersecurity, and AI team is experienced in helping clients navigate these and other emerging AI matters.