Navigating the Legal Challenges in AI-driven Employment

Rebecca Sha is a partner at Phelps Dunbar, a regional law firm in the Gulf South. Specializing in labor and employment law, she guides companies in managing workplace risks and human resources issues. As an attorney, Rebecca handles litigation involving employee-employer disputes and provides counseling services to ensure clients' policies comply with current laws. Her expertise helps businesses navigate labor challenges and maintain a legally sound work environment.

In an interview with HR Tech Outlook, Rebecca Sha, Attorney in Labor and Employment at Phelps Dunbar, shares her insights on the challenges labor and employment sector faces due to the rise of Artificial Intelligence in hiring and other employment-related aspects.

What according to you are some of the challenges that exist in the industry lately?

As a labor and employment attorney, I have observed several challenges arising from the growing impact of artificial intelligence (AI) in the workplace. AI has revolutionized how companies operate, particularly in HR and hiring processes. But, along with this progress come legal complexities that employers must navigate to ensure compliance and fairness.

One major issue is the chances for AI to mistakenly introduce biases into decision-making. Even though AI seems objective, it’s programmed by human beings. Also, the data sources it uses can contain inherent biases, making it flawed. For example, AI used for resume scanning or virtual chatbot interviews may unintentionally favor certain groups, leading to discriminatory hiring practices.

Businesses must understand the role of AI in their processes and stay updated on rapidly evolving regulations. AI may be part of their process without them knowing about it or third party organizations they hired may be using it. Government agencies like the Equal Employment Opportunity Commission (EEOC) and Department of Justice (DOJ) are closely monitoring AI's impact on protected classes. They use guidelines such as the 80 percent rule, assessing whether an AI feature leads to significantly lower selection rates for certain groups. Companies must ensure their AI-driven decisions are job-related and necessary in order to mitigate potential legal risks.

“While AI promises efficiency and innovation, organizations must carefully consider its implications and proactively address potential challenges to ensure a smooth and compliant transition into the future.”

Despite these challenges, AI has positively impacted the employment arena, streamlining hiring processes and enhancing efficiency. However, companies must proactively address biases and stay informed about changing regulations to ensure a fair and inclusive work environment. Ignorance of AI's discriminatory impact is not an excuse, and businesses must take responsibility for the outcomes of their AI-driven decisions.

What are your specific strategies in helping your team adaptto these changes or, bring about these transformations within your own workflow?

In terms of adapting to the impact of AI in the legal field, I have been advising my clients to take certain specific measures. Firstly, it's essential for businesses to be fully aware of whether they are using AI in any aspect of their operations, even if they believe they are not.

Transparency is key. If AI is being employed in the hiring process, it's crucial to inform candidates upfront through job postings or disclaimers. Companies should clearly state that they do not discriminate based on any protected class.

Those who use AI in video monitoring or facial recognition during interviews must make sure that candidates are aware of such practices, the criteria used, and how their data will be evaluated.Engaging third-party experts to evaluate and audit the results of AI software is also a prudent step to keep biases at bay.

By prioritizing knowledge, transparency, and third-party audits, businesses can effectively navigate the evolving legal landscape surrounding AI in the workplace and foster a fair and inclusive environment for their employees.

What other disruptions might take place in the coming months or the coming years; what does the future really hold for technologies like AI in the future?

Looking ahead, I anticipate significant disruptions in the job market due to the continued advancement of AI and related technologies. Jobs that involve repetitive tasks or data analysis may be at risk of being automated, leading to potential workforce displacement. As a legal and HR professional, I emphasize the need for organizations to assess the associated risks when making decisions regarding layoffs or terminations due to AI implementation.

Data security is another crucial concern. With the increased use of AI comes a higher risk of sensitive data being breached or compromised. Organizations must prioritize data protection and be aware of state-specific data privacy laws to avoid potential legal consequences in the event of a security breach.

States and localities enacting new laws to regulate AI is a trend that is expected to continue, creating challenges for businesses with a remote or multi-location workforce. Adapting to various regulations governing AI usage in the workplace will be a critical aspect of future operations.

While AI promises efficiency and innovation, organizations must carefully consider its implications and proactively address potential challenges to ensure a smooth and compliant transition into the future.