Artificial intelligence and employment law
Employers are increasingly using AI in recruitment and management. This briefing explores the employment law implications and proposals for regulatory reform.
Artificial Intelligence (AI) is a term which can encompass a wide variety of technologies, many of which are increasingly used in workplace management. The use of these technologies, while offering much potential, has also proved controversial and raised some important legal questions.
Algorithmic management refers to the use of AI or other algorithmic tools by employers to manage workers. Over recent years algorithmic management and the use of AI tools have become more widespread across many sectors of the UK. In particular, their use has been noted in three broad areas:
- In recruitment, to devise job adverts, source candidates and filter CVs. Some recruiters also use automatically scored tests as part of their recruitment process.
- In task allocation and performance management, including scheduling shifts and evaluating worker performance.
- In surveillance and monitoring of the workforce, tracking workers to monitor productivity or health and safety in the workplace.
There are currently no explicit UK laws governing the use of AI and other algorithmic management tools at work. However, several current areas of law potentially restrict the use of these tools in practice.
Common lawCommon law understanding of the relationship between employer and employee is one of personal service, requiring a degree of mutual trust and confidence between the two parties, including being able to explain decisions (Keen vs Commerzbank AG [2006]).
This may limit the degree to which employers can substitute AI decision-making for their own judgement before this is considered legally to undermine the basis of the employment contract.
Equalities lawThe Equality Act 2010 prohibits discrimination by employers on the grounds of any protected characteristics, such as age, sex or race. It is widely accepted that AI tools can exhibit biases because of the ways in which they are trained; this may make the use of some AI tools that make or influence workplace decisions unlawful, unless care is taken to minimise such biases.
Privacy lawArticle 8 of the European Convention on Human Rights guarantees the right to privacy. Its incorporation into UK law via the Human Rights Act 1998 places some restrictions on the use of surveillance tools to monitor workers.
Data protection lawData protection law places restrictions on data collection and processing. In particular, Article 22 of UK GDPR provides data subjects with the right:
not to be subject to a decision based solely on automated processing, including profiling, which produces legal [or similarly significant] effects concerning him or her.
While potentially a significant restriction on the use of AI decision making by employers, in practice the Information Commissioner’s Office has not yet issued any penalties to enforce this provision of UK GDPR. The Data Protection and Digital Information Bill (no. 2) currently going through Parliament would replace the current “general prohibition” on automated decision making with alternative “specific safeguards”.
Policy developmentThe UK Government's March 2023 white paper ‘A pro-innovation approach to AI regulation’ laid out the framework for current plans to regulate of AI. This would take a non-statutory approach, relying on existing regulators to oversee the use of AI in their areas while following five broad principles: safety, transparency, fairness, accountability, and contestability.
The white paper has been criticised as a “laissez-faire” approach by the Labour Party, which has called for a more interventionist approach.
Other organisations have put forward alternative policy proposals. For example, the All-Party Parliamentary Group for the Future of Work advocates for an Accountability for Algorithms Act in their November 2021 report ‘The New Frontier: Artificial Intelligence at Work’. The AI Law Consultancy’s report ‘Technology Managing People – the legal implications’ (PDF), commissioned by the Trades Union Congress (TUC), proposes a range of alternative reforms to existing legislation along with new statutory guidance.
International policyOverseas, the EU is in the process of introducing its AI Act, which is a much more interventionist and prescriptive approach to AI regulation.