New EEOC Guidance Highlights Employer Responsibility for AI Decisions

In mid-May, the Equal Employment Opportunity Commission (EEOC) issued guidance emphasizing that employers are accountable for their software, algorithms, and artificial intelligence’s decisions regarding race, color, religion, sex, or national origin. This is not a new law, but rather a reminder that current laws and regulations still apply to new processes and software. The EEOC refers explicitly to the Uniform Guidelines on Employee Selection Procedures under Title VII, indicating that there are no shortcuts around these rules.

The EEOC states that if an employer uses a selection procedure that discriminates based on factors prohibited by Title VII, they may be held responsible even if the test was created by an external vendor. Furthermore, employers can be held liable for the actions of their agents, such as software vendors, if they have authorized them to act on the employer’s behalf.

So, what should employers do?

The EEOC advises that, at a minimum, employers should inquire with vendors whether using their tool results in a significantly lower selection rate for individuals with characteristics protected by Title VII. The guidance also provides specific questions that employers should ask vendors or firms using algorithmic methods for recruitment on their behalf.

The Society for Human Resource Management issued a news alert stating that without proper safeguards, employers might violate Title VII when using AI for employee selection, performance monitoring, and determining pay or promotions. Employers must be aware that they will be held accountable for any violations, even if the AI tool is administered by a third party, such as a vendor contracted by the employer to provide the service.

This is not the last word on the subject — just one of the first!

More guidance and interpretations are likely to come in future weeks and months. For now, the takeaway is that well-established rules apply no matter which people — or machines — do the hiring and HR management. Meanwhile, the new guidance is available on the EEOC website.