Artificial Intelligence (AI) is being adopted at a rapid pace across industries – and for good reasons. AI-driven tools increase efficiency, reduce administrative burdens, and enhance data-driven decision-making. In the employment context, businesses commonly use AI for applicant screening, hiring and promotion decisions, productivity monitoring, and other personnel actions.

AI integration has significantly increased during the hiring process. Employers use AI tools to analyze resumes, identify qualified candidates, research publicly available background information, and even evaluate video interviews. Some systems purport to assess personality traits or “culture fit” based on facial expressions, word choice, and vocal patterns. While these technologies offer many benefits, they also introduce substantial legal risks in an era where many people are uncomfortable with AI and the government is raising regulatory and other hurdles to its usage.

Bias Auditing and Algorithmic Discrimination

As AI tools increasingly augment human decision-making, employers must be mindful of potential bias embedded within automated systems. Algorithmic discrimination – whether intentional or inadvertent – can expose employers to liability under federal and state anti-discrimination laws.

California has been particularly active in this space. The California Civil Rights Department (CRD) issued regulations addressing the use of Automated Decision Systems (ADS), signaling future scrutiny of AI...

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