Earlier this month, AI in hiring platform Eightfold was hit with a proposed class action lawsuit by a group of job candidates. They charge that applicants are not given a chance to review the data Eightfold’s AI scrapes about them online, unfairly disadvantaging them from jobs. The suit follows the high-profile Mobley v. Workday, another proposed class action in which applicants say the HR tech giant’s AI-powered tools discriminate against older job seekers.

“This was an inevitable outcome with all of the change brought on by AI,” Neil Costa, CEO and founder of global recruitment advertising agency HireClix, tells HR Executive. “This [Eightfold] lawsuit is the tip of the iceberg.”

When job seekers are rejected—and they know that employers may be using AI as part of the talent acquisition process—they may immediately assume the systems create bias, Costa says. This is going to create ongoing, and heightening, legal risk for providers of AI hiring software and their clients.

“As AI vendors, focused on recruiting, continue to showcase their functionality and features along with the big brands that benefit from them, they will be putting targets on their backs—and their customers’ backs,” Costa predicts.

A ‘clear and present danger’

Job seekers’ concerns are valid, he notes, particularly in cases where TA processes are “sprinkled with AI that could be creating risk.” For instance, AI tools that rely on “rigid, quantifiable data” to prioritize candidates while overlooking other metrics around social and cultural fit could be perpetuating systemic bias.

“Some AI functionality could be masked as operational efficiency, but likely creates risk for the organization,” he says.

That risk increases when employers share proprietary data with vendors to inform judgments on candidates, Costa adds.

What’s more, AI-powered “repeatable processes and systems” in TA can invite outside fraud.

“If there is a structured system implemented for AI, then there is effectively the opportunity to build a counter-agent to manipulate that system,” he says. “We believe fraudulent candidates and fraudulent jobs are a clear and present danger to every employer because of AI.”

Prioritizing safety and strategy for AI in hiring

Despite the legal risks, it’s not all “doom and gloom” for AI in TA.

“There is both good and bad in anything new,” Costa cautions.

For instance, recruiters are leveraging the tech for real process optimization—with AI surfacing top-priority requisitions or scheduling phone screens.

“All of these scenarios and more make me feel like we are using AI in a very safe way to get more from the labor of our recruiting teams,” Costa says.

But when data is shared “recklessly” with vendors, legal risk skyrockets, and candidate perceptions are also in the crosshairs.

“Being thoughtful about who gets what data is paramount to each HR executive’s success in leveraging the advances in AI technology,” Costa says.

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