Survey of nearly 400 executives reveals how employers are adopting AI tools in HR and managing risk amid regulatory uncertainty
(September 25, 2023) – Littler, the world’s largest employment and labor law practice representing management, has released the results of its AI in the Workplace Survey Report, based on responses from 399 in-house lawyers, human resources (HR) professionals and other business leaders across the United States.
The survey finds employers looking to reap benefits from artificial intelligence (AI) tools in HR functions, while navigating new vulnerabilities created by an evolving patchwork of AI regulation and rapid technological change.
Cautious Approach to Generative AI in HR
While many employers are already leveraging predictive AI tools – such as those used in recruiting, hiring and other HR processes – the survey finds that use of generative AI technologies, such as ChatGPT, that create new data or content is not yet as widespread. More than half of respondents (56%) say their organizations are not using generative AI tools in any HR capacity. Among those incorporating generative AI into HR functions, the most common usage (selected by 34%) was for content creation, including job descriptions, onboarding materials and employee communications.
“Generative AI holds great promise for HR functions by automating repetitive and time-consuming tasks, as well as improving start-up times for content creation activities,” said Niloy Ray, Littler shareholder and member of the firm’s AI in Human Resource Decisions practice. “Given that the technology is still developing and that its impact on workforces is increasingly complex, it’s encouraging that employers appear to be taking their time implementing it organization-wide.”
AI Guidelines and Workplace Policies Still Taking Shape
The integration of predictive AI tools into HR functions presents a range of challenges for updating policies, procedures and trainings in accordance with the pace of change. Less than half of respondents (45%) say they limit AI usage to approved tools and uses, while only 37% provide policies or guidance to employees on the proper use of AI tools in the workplace. Only 21% test AI tools for potential bias, compliance and other risk factors.
“Many companies are finding considerable value in AI faster than expected. This is a testament to AI’s power, but it also creates pressure to adopt tools quickly, sometimes before the appropriate compliance mechanisms to manage them are in place,” said Marko Mrkonich, Littler shareholder and member of the firm’s AI in Human Resource Decisions practice. “At the same time, the survey found a high degree of collaboration among departments in managing AI, which is a promising sign that strong policies and guidelines will emerge as AI tools mature.”
With regard to the departments tasked with managing AI-driven HR tools, respondents report a fairly equal degree of involvement from HR and talent acquisition (65%), information technology (64%) and legal and compliance (63%).
Employers Seek Regulatory Guidance
In the face of regulatory uncertainty surrounding the use of AI in HR, many employers are proceeding cautiously.
As varying laws and policies governing the use of AI in HR emerge, 51% say their organizations have not changed their AI usage but are closely monitoring regulatory developments. Another 29% are limiting the scope of HR activities for which AI tools are deployed. That only 10% have halted usage altogether or decreased use in jurisdictions with proposed or enacted legislation is a sign that employers are willing to take on a certain level of risk in exchange for the benefits these tools bring.
While several U.S. states are proposing or developing legislation, only New York City currently has a law in place specifically governing the use of AI in employment-related situations. Even so, just 33% of respondents identified New York City’s legislation as a concern compared to 53% who said the same of legislation being considered in California.
“New York City may be first, but California will set the standard for the regulation of AI in HR,” said Ray. “The state’s size and influence on the rest of the country, in the absence of federal regulation, is going to affect a much larger segment of employers than New York City and will likely provide a blueprint for other states around the country.”
About Littler
With more than 1,800 labor and employment attorneys in offices around the world, Littler provides workplace solutions that are local, everywhere. Our diverse global team and proprietary technology foster a culture that celebrates original thinking, delivering groundbreaking innovation that prepares employers for what’s happening today, and what’s likely to happen tomorrow.
