HR Policy Urges California to Abandon AI Discrimination Regulation

In comments submitted to the California Civil Rights Department, HR Policy Association urged the CRD to scrap a proposed regulation that could drastically increase employer liability for the use of third-party technology in hiring and recruiting, among other functions. 

The proposed rule: The CRD issued the proposed rule in May “to provide clarity regarding [state discrimination law] obligations and requirements as they relate to the use of automated decisions systems or other selection criteria in the employment context.” 

The rulemaking clarifies that existing discrimination law applies to the use of such technologies in employment decisions and defines the scope of liability for violations. However, the proposed rule’s broad definitions and vague language could drastically increase liability for employers and developers of AI and related automated decision systems.

Our comments: The Association strongly urged the CRD to scrap the rule or, at the very least, substantially revise it. The Association argued that the rulemaking is unnecessary as discrimination in employment decisions is already prohibited, regardless of the method or technology used. 

In addition, the Association’s comments highlight specific flaws in the rule:

• Broad definitions and vague language would unreasonably expand employer and/or developer liability such that they could be on the hook for discriminatory effects of technology used by third parties neither within their control nor visibility. 
  
  
  • For example, if an employer used a job search platform such as Indeed to post jobs, and Indeed used technology that discriminatorily matched applicants with jobs or screened out applicants, the employer could be potentially liable, despite having no control over or knowledge of the technology nor its discriminatory use. 
    
    
• Extensive recordkeeping requirements are overly burdensome and would implicate privacy concerns, including compliance with California’s own data privacy laws. 

What’s next: The CRD will review public comments and issue a final rule, likely sometime before the end of the year. The proposed rule was silent on how long employers would have to come into compliance once the final rule is issued. Meanwhile, the California state legislature is considering different bills which would also address AI/automated-decision system-related discrimination.