Artificial Intelligence (“AI”) is rapidly changing the way businesses operate. From screening job applicants and reviewing resumes to analyzing employee performance and improving workplace efficiency, AI tools can save employers significant time and resources. However, as AI becomes more integrated into everyday business operations, employers should understand that these technologies may also create new legal risks.
Employment laws were largely developed before AI became a common workplace tool, but existing legal obligations still apply. Employers remain responsible for their hiring decisions, employment practices, and treatment of employees—even when technology is involved. Businesses should not assume that because a decision was made or assisted by an AI program, it is free from scrutiny.
Here are four important questions employers should consider before implementing AI in the workplace:
- How is AI being used in hiring and recruiting? Many employers are using AI to screen resumes, rank candidates, and identify potential hires. While these tools can streamline the hiring process, employers should understand how the technology reaches its conclusions. If an AI system disproportionately excludes certain groups of applicants, it may create discrimination concerns under federal and state employment laws.
- Could AI create bias or unintended discrimination? AI is only as effective as the data and programming behind it. If an AI tool relies on historical data or flawed assumptions, it may unintentionally favor certain candidates or employees over others. Employers should regularly review AI-driven processes to ensure that technology is supporting fair and consistent employment decisions.
- How is employee information being collected and protected? Many AI systems require access to large amounts of information, including employee data, performance metrics, and workplace communications. Employers should understand what information is being collected, who has access to it, how it is stored, and whether their privacy policies appropriately address these practices.
- Do your workplace policies address AI use? As AI tools become more common, employers should consider whether their employee handbooks and workplace policies need to be updated. Policies may need to address acceptable AI use, confidentiality concerns, data security, and the extent to which employees may rely on AI tools in performing their work.
AI offers businesses tremendous opportunities, but it should be implemented thoughtfully. A proactive review of AI practices, employment policies, and workplace procedures can help employers take advantage of new technology while reducing unnecessary legal risk.
Co-written by Joseph Fournier and Ava Marenna, Fournier Legal Services.