EEOC Settles Lawsuit for Alleged Artificial Intelligence (AI) Discrimination in Hiring
On August 9, 2023, the U.S. Equal Employment Opportunity Commission (EEOC) reached an agreement with a tutoring company that “allegedly programmed its recruitment software to automatically reject older applicants” to settle its “first-ever” Artificial Intelligence (AI) discrimination in hiring lawsuit, according to a news report from BloombergLaw.com.
The tutoring company “will pay $365,000 to a group of rejected job seekers age 40 and over” as directed by a proposed consent decree awaiting approval that was filed in the United States District Court for the Eastern District of New York, BloombergLaw.com reported. However, the tutoring company also admitted no wrongdoing under the consent decree.
The EEOC sued the tutoring company providing English-language services to students in China in May 2022 for allegedly rejecting more than 200 qualified applicants because of their age by programming “their tutor application software to automatically reject female applicants age 55 or older and male applicants age 60 or older,” an EEOC press release stated.
The alleged conduct by the tutoring company violated the Age Discrimination in Employment Act (ADEA) of 1967 which prohibits employers from discriminating based on age. The EEOC – which enforces federal laws prohibiting employment discrimination – filed the lawsuit after the parties were unable to reach a pre-litigation settlement.
In May 2023, the EEOC released a technical assistance document on “Assessing Adverse Impact in Software, Algorithms, and Artificial Intelligence Used in Employment Selection Procedures Under Title VII of the Civil Rights Act of 1964” that explained the application of Title VII of the Civil Rights Act of 1964 (Title VII) to an employer’s use of automated systems.
Employers increasingly use automated systems such as AI to help them with employment matters such as selecting new employees, monitoring performance, and determining pay or promotions. Without proper safeguards, their use may violate Title VII, which is enforced by the EEOC and prohibits discrimination based on race, color, national origin, religion, or sex.
The technical assistance document discusses “adverse impact” to help employers prevent the use of AI from leading to discrimination in the workplace, answers questions about how Title VII applies to the use of automated systems in employment decisions, and assists in evaluating whether such systems may have an adverse or disparate impact prohibited by Title VII.
The document builds on previous EEOC releases of “The Americans with Disabilities Act and the Use of Software, Algorithms, and Artificial Intelligence to Assess Job Applicants and Employees” in May 2022 and a “Joint Statement on Enforcement Efforts Against Discrimination and Bias in Automated Systems” with other United States government agencies in April 2023.
“As employers increasingly turn to AI and other automated systems, they must ensure that the use of these technologies aligns with the civil rights laws and our national values of fairness, justice, and equality,” said EEOC Chair Charlotte A. Burrows. “This new technical assistance document will aid employers and tech developers as they design and adopt new technologies.”
In 2021, EEOC Chair Burrows launched an agency-wide “Artificial Intelligence and Algorithmic Fairness Initiative” to ensure that the use of software including AI, machine learning, and other emerging technologies used in hiring and other employment decisions comply with the federal civil rights laws that the EEOC enforces. To learn more about the EEOC, visit www.eeoc.gov.
ClearStar is a leading global Human Resources technology company specializing in background checks, drug testing, and occupational health screening. The use of AI by employers coming under government scrutiny is one of the “2023 Top Trends in Workforce Screening” researched and compiled in a white paper by ClearStar. To learn more about ClearStar, contact us.
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