AI Guidance Ups Ante for Employers Trying to Avoid Bias Claims

Bloomberg Law
May 23, 2023
  • EEOC has provided more information on Title VII’s application
  • HR tools using artificial intelligence have become popular

Employers may be compelled to rethink how they use AI tools to make workplace decisions after new EEOC guidance clarified that they can be held liable for biased effects of the software’s use.

The Equal Employment Opportunity Commission technical assistance document, released last week, addressed how artificial intelligence can violate Title VII of the 1964 Civil Rights Act’s protections against bias for job applicants and employees. It also tackled the role employers have in preventing this type of discrimination.

Companies are adopting AI software for hiring at a faster rate than before, with nearly one in four organizations using these tools to support HR-related activities in 2022, according to a study from the Society for Human Resource Management. But legal and AI experts say they now expect companies to reevaluate their use of AI for employment decisions and perhaps ditch the technology entirely until they have a body of case law to lean on.

Title VII prohibits discrimination in employment, which includes tests or selection procedures that disproportionately exclude groups of people based on their race, color, nationality, sex, or religion. The new guidance states that employers may be held responsible for disparate treatment by any algorithmic decision-making tool used in processes for hiring, promotion, or termination, even if those tools were designed or administered by a vendor.