AI is creating HR problems for employers

AI hiring tools can violate FCRA 

A recent lawsuit filed in California should raise serious concerns to any employer using artificial intelligence (AI) to screen applicants. The lawsuit, Kistler et al. v. Eightfold, AI Inc., claims the platform scraped personal data on over a billion workers, assigned each applicant a scored ranking, and filtered out lower-ranked candidates before any human reviewed their application, all without the disclosures required by Fair Credit Reporting Act (FCRA). 

Currently, more than 95% of employers conduct preemployment background checks, with an increasing number relying on automated systems to process the information. If AI assembles or evaluates consumer report-related information for employment purposes and produces an output that affects an applicant’s eligibility, then an employer may now have an FCRA obligation—in which case, it must provide written disclosure to applicants, receive authorization from the applicants, and establish a clear adverse action process that gives candidates the chance to see and dispute the information used against them. 

AI is raising religious discrimination claims 

Employers are now struggling with how to accommodate employees seeking religious exemptions from using AI. It’s expected that many jobs will be affected by AI in the near future. Various religious organizations have issued guidance stating that human dignity must be central to the use of AI and that it should never reduce workers to mere “cogs in a machine.”