Employers, Take Notice as the DOL Crafts White House AI Mandates

On Oct. 30, President Joe Biden heeded the call from many sectors to address AI’s vast benefits and challenges by issuing a wide-ranging executive order. Inside the Beltway, efforts to understand, evaluate, and perhaps regulate use of AI have kept Capitol Hill and White House policymakers busy.

Chief among concerns is the potential for new technologies to create unintended security, environmental, civil rights, and disinformation risks. The comprehensive EO addresses these risks in detail, and the Department of Labor is poised to play a significant role shaping its effects on workplaces.

Key EO provisions delegate several responsibilities to the DOL. These tasks don’t rise to the level of regulatory mandates, which require notice and comment from the public. But the agency is poised to issue broad and far-reaching guidance that may standardize how employers are to deploy AI tools. The EO’s key DOL-related provisions establish several requirements.

Preventing Hiring Discrimination

The EO requires that, in the next year, the DOL publish guidance on preventing discrimination in hiring related to use of AI tools. The Equal Employment Opportunity Commission’s most recent guidance, as well as high-profile lawsuits against employers and HR vendors, has brought AI bias to the forefront.

In addition, the National Institutes of Science and Technologies detailed hiring bias and a broad framework for addressing it in a 2022 report.

While this dictate is cabined to hiring practices, broad concerns exist that AI tools affect other employment practices such as performance evaluations, compensation systems, and reasonable accommodations. Employers should prepare for the DOL Office of Federal Contract Compliance Programs to take the lead following the agency’s recently updated audit scheduling letter to gather federal contractors’ AI policies and practices in its reviews.

Broad questions remain about whether the guidance will contain detailed prohibitions on the use of various popular AI tools or recommend employers perform rigorous testing of existing tools to mitigate any bias.

AI Workers

The EO charges the DOL with issuing a request for information by Dec. 14 to gather public input from a wide swath of sectors, including “worker-advocate communities”—to determine whether a shortfall exists of “willing, able, and qualified United States workers” for AI and STEM occupations.

DOL-related immigration programs such as H-1B certification are premised, in part, on whether US workers “are available” to fill domestic labor shortfalls, or whether “an employer desires to employ nonimmigrant foreign workers.”

Seeking this information will likely be a precursor to the administration considering changes to these popular programs. And we expect technology companies, in particular, will be incentivized to make their case that these workers are vital to ramping up their AI capabilities.

Nonetheless, as most immigration-related measures in Washington remain hot-button issues, it’s unclear if the information DOL receives in this data call will gain traction. The next step, for now, will be mining the upcoming request for information to see if it signals any direction the DOL may take or whether upcoming rulemaking is on the horizon.

Worker Displacement

One significant concern of AI use is the potential to replace work tasks currently performed by humans. The EO requires that, by April 27, 2024, the DOL will issue a report evaluating how federal agencies could support workers displaced by technology advancements. Questions exist about how the results of the report will be used, as the EO is silent on this point.

However, as the vast amount of appropriations to the DOL are earmarked for workforce development and support programs, the report will likely form the basis of strategies and resources that will be needed for the government to support displaced workers and fund worker retraining programs.

Workplace Monitoring Systems

Employers’ desire to ensure worker productivity during the pandemic, coupled with AI predictive technologies, has placed workplace monitoring systems in the crosshairs of government and union officials. The EO doesn’t seek to limit or forbid such systems. Rather, it requires the DOL to issue guidance to ensure compliance with labor standards requirements under the Fair Labor Standards Act “and other legal requirements.”

Employers should take note of the broad “other legal requirements” language and be prepared for the DOL, National Labor Relations Board, and EEOC to weigh in on these systems.

AI and Employee Well-Being

This requirement correlates to the administration’s strong desire to address the secondary effects of employer adoption of AI technologies. Those secondary effects could include job displacement risks, diminishing labor standards, and misuse of employee data.

The DOL will have wide latitude in crafting this guidance, and it will be important for employers to evaluate whether their practices could lead to these secondary effects.

Takeaways

As in many administrations, the DOL remains an essential agency to address larger issues that affect the country’s workers. Its next steps in response to the significant benefits and challenges of AI will span hot-button issues such as immigration, worker displacement, and civil rights.

Savvy employers require deep knowledge and understanding of how the DOL fits into the larger puzzle, as well as the nuts and bolts of the regulatory and policy landscape to determine what may actually get done.

Employers can get ahead of these changes by conducting deep evaluations of their AI practices and policies, and be ready to quickly address any policy or regulatory changes coming from the government.

This article does not necessarily reflect the opinion of Bloomberg Industry Group, Inc., the publisher of Bloomberg Law and Bloomberg Tax, or its owners.

Author Information

Christopher Wilkinson is a senior counsel in Perkins Coie’s labor and employment practice, and former associate solicitor for civil rights at the Department of Labor.