No Robot Bosses! Congress Takes on Employers’ Use of Artificial Intelligence

At a Glance

• Sens. Bob Casey (D-PA) and Brian Schatz (D-HI) have recently introduced the No Robot Bosses Act (The Bill) to the senate in an effort to regulate employers’ use of automated decision systems (ADS) in the workplace.
• The Bill covers past and present candidates for employment as well as workers “performing work for remuneration.” This broad definition is of particular importance as many employers use AI to sift through past applications to solicit reapplications if a new position opens up.

Lawmakers nationwide are increasing efforts to comprehend and control employers’ use of Artificial Intelligence (AI). Sens. Bob Casey (D-PA) and Brian Schatz (D-HI) introduced the “No Robot Bosses Act” (the Bill) on July 20, 2023. The Bill aims to regulate employers’ use of Automated Decision Systems (ADS) in the workplace.

What is an Automated Decision System?

The Bill defines an ADS broadly and as follows:

The term “automated decision system” means a system, software, or process that (i) uses computation, in whole or in part, to determine outcomes, make or aid decisions (including through evaluations, metrics, or scoring), inform policy implementation, or collect data or observations, including such a system, software, or process derived from machine learning, statistics, or other data processing or artificial intelligence techniques; and (ii) is not passive computing infrastructure.

The Bill’s definition of an ADS is much broader than the recently effective New York City Local Law 144 of 2021. This may cause some alarm among employers. However, future amendments and rulemaking may narrow the scope of this definition, as was the case in New York City.

Who Would Be Regulated?

Unsurprisingly, the Bill covers a broad range of individuals. Covered individuals include past and present candidates for employment as well as workers “performing work for remuneration.” Therefore, the Bill de facto covers both independent contractors and employees. This broad definition is of particular importance as many employers use AI to sift through past applications to solicit reapplications if a new position opens up. Similarly, companies also use AI to evaluate existing employees for promotion. At this stage, it is unclear if the Bill would apply to employers using ADS in these situations.

Covered employers include employers that “employ or otherwise engage for the performance of work for remuneration 11 or more Covered Individuals.”

What Would the Bill Regulate?

The Bill would regulate covered employers’ use of ADS when making “employment-related decisions.” The Bill defines the latter as “a decision by an employer with regard to hiring (including any decision with regard to recruiting, screening, interviewing, or selecting a candidate)[,]… firing, retaining, taking a disciplinary action against, demoting, or reassigning duties of[,]… or any other term, condition, or privilege of employment or work, such as relating to pay, scheduling, health care or long-term care coverage, benefits, or hours worked or promoting” a covered individual.

With regards to covered employers, the Bill:

• Prohibits exclusive reliance on an ADS for employment-related decisions.
• Requires independent corroboration via meaningful human oversight of any ADS output.
• Requires pre-deployment testing and validation of an ADS for efficacy, compliance with applicable employment discrimination laws, and lack of discriminatory impact on federally protected categories.
• Requires compliance of the ADS with the National Institute of Standards and Technology’s Artificial Intelligence Risk Management Framework.
• Requires training of individuals or entities that operate the ADS for the covered employer.
• Requires an annual independent discriminatory impact test of the ADS and the publication of the results of such tests.
• Provides covered individuals the alternative to be “managed¹ through a human manager” and not through an ADS.
• Prohibits retaliation against covered individuals for exercising their rights under the Bill.
• Provides protections to whistleblowers.
• Renders any pre-dispute agreements to arbitrate employment-related disputes or pre-dispute waivers of joint, class, or collective actions in any forum invalid or unenforceable with respect to ADS use or ADS-related whistleblower claims.
• Establishes a “Technology and Worker Protection Division” within the Department of Labor to investigate, report and enforce violations under this bill.

How Would the Bill Be Enforced?

The Secretary of Labor would enforce this Bill similarly to the Fair Labor Standards Act. Additionally, covered individuals would have the right to commence a civil action in Federal court to recover damages, injunctive relief and/or equitable relief. Damages would range from $5,000 to $100,000 per violation. 

Takeaways

The Bill was recently introduced and is still in the preliminary stages of the legislative process. Although extremely broad, there are several facets of the Bill that will be clarified and amended before becoming law, if ever. However, it is the latest example of the federal will to broadly regulate the use of AI in employment-related decisions.

Faegre Drinker is carefully monitoring the ever-evolving AI space, including what it means for the use of AI in employment-related decisions. We draw on a full-service platform ready to address the array of issues our clients face as a result of the decision. For more information and resources, visit our Artificial Intelligence and Algorithmic Decision-Making page.