Ethical AI in HR

Can Artificial Intelligence be used ethically in HR?

If the headlines are to be believed, Artificial Intelligence (AI) is set to revolutionise not just business practices, but every aspect of our lives. The scaremongers suggest AI poses a significant threat to human jobs, creativity and livelihoods, while early adopters rave about its potential freedom-giving benefits for businesses and people.

A 2024 Gartner survey found that 38% of HR leaders are piloting, planning implementation, or have already implemented generative AI in their organisation, for purposes including employee-facing chatbots, generating documents, and supporting recruitment.

It’s clear that AI has a role to play in the future of work, however there are still many questions surrounding the use of new technologies, particularly around its legitimate, ethical and safe use in HR practices. For example, is it ethical to use AI to record and transcribe an interview? How would that recording be kept safe? And who is responsible for maintaining its long-term security?

Optimistic businesses are carefully testing the water when it comes to using technology to streamline business processes, gain efficiencies and improve the way we work. Is it possible that AI could spark positive change in the way HR departments function? 

In order to implement AI applications in a practical, safe and ethical manner, HR teams must prioritise fairness, transparency and accountability in its introduction. We’ve put together this guide to support managers with decisions on how and when to introduce AI in HR, ensure they follow correct governance, and provide adequate training for their teams.

What this ebook covers

In this ebook we will explore:

• What do we mean by ethical use of AI?

• Current and future uses of AI in HR

• Benefits and risks of using technology in HR practices

• Who is responsible for the ethical use of AI?

• The importance of clear governance

• What should an AI usage policy cover?

• Training and education considerations

What do we mean by using AI in an ethical way?

Ethical means taking action in a morally good or correct way. When we explore ethics in the use of AI in HR, we must ask two questions:

• Are you using AI for correct and legitimate business reasons?

• Are you implementing it in a way that protects your business, your people, their data and their interests?

To help you answer these questions, consider the following trains of thought.

Keeping personal data safe

In HR we deal with people and those people come with a lot of personal data. Employees naturally want reassurance that AI systems and technologies using their data are taking steps to keep that data safe from cyber criminals. Your organisation has a responsibility to protect data under GDPR.

Do your research

All new HR systems and processes should start from a position of knowledge. Take steps to do thorough research so you are well-informed to justify the use of AI in your work. With proper research you will be able to introduce and communicate the benefits of new systems in a thoughtful, considered way, and be well prepared to answer questions and concerns.

Communicate clearly

To build confidence in the implementation of AI, it’s important to ensure fairness and transparency around how and why it will be used. Encourage two-way conversations so that your team and the wider business can understand the thinking behind it and have ample opportunity to voice their concerns. 

Accountability

It’s important to have policy and structure surrounding the ethical use of AI. Employees need clarity around ownership of the technology, how and when it can be used, and their responsibility to protect personal data and prevent security breaches. 

Understand employees’ concerns

AI is an emotive subject. When embracing and exploring new technologies, HR teams must be aware of its potential benefits and possible shortcomings. Sensitive issues will always require human empathy, for which computers and robots are no replacement.

How is AI being used in HR functions?

If you read our blog about AI in Communication, we discussed how HR teams are already using AI for everyday tasks, such as HR self-service platforms, employee feedback surveys, and virtual training solutions.

AI has the potential to take manual, repetitive, time-consuming tasks away from HR teams, freeing up resource to focus on creative people solutions to benefit the workplace.

Recruitment

Automated software can screen candidates to remove bias from the early selection process. Software checks against essential criteria and filters out suitable applicants to go forward to the next stage. Generative AI provides inspiration for interview questions, job descriptions and other recruitment documentation.

Performance reviews

AI can take some of the emotion out of performance management by analysing performance against key metrics. Applications can also be used to assess and adjust salary bands and calculate uplifts without bias.

Communications

Generative AI can be a useful communication aid. Use it to inspire HR messaging and policy documents, translate for different audiences, assess the tone of your content or suggest how to make language more inclusive.

Employee engagement

Automated engagement surveys have been in use for a long time to help management better understand their workforce. Software analyses responses to spot patterns, gauge employee sentiment and highlight issues to focus on.

Workforce planning

AI has been automating tasks like holiday requests, payroll, and employee benefits for several years. Its ability to analyse large datasets allows organisations to forecast future resource requirements and identify absence patterns, training and skills gaps.

What are the future possibilities for AI in HR functions?

Once you embrace AI-based tech in everyday processes, you become aware of its potential to completely transform the way we work. Rather than looking upon AI as a threat to jobs, think of it as an extra team member enabling you to deliver better outcomes and support mechanisms for employees.

Why not experiment by adopting some of the following approaches to test the possibilities of using AI in your organisation. Do so ethically and responsibly.

Recruitment and induction

• Save time by using listening AI to transcribe interview conversations for future reference.

• Consider using software that can analyse video submissions to interview questions and recommend suitable candidates.

• Create an automated online induction process to replace human resource heavy administration.

• Implement online learning solutions as a flexible, accessible way of onboarding new recruits.

Performance and talent management

• Take the emotion out of asking for feedback. Use automated software to request qualitative feedback that will complement AI-generated performance data.

• Ask generative AI to draft definitions of success that set clear expectations and outline a roadmap to advancement and promotion.

• Ask software to analyse performance data and draft reviews free of human bias.

Employee engagement

• Employ AI to carry out sentiment analysis on employee feedback. Use the data to understand how people are feeling now, track sentiment over time, and make necessary changes to fully support your workforce.

• Use engagement and satisfaction data to predict future turnover rates and plan for recruitment campaigns.

People development

• Embrace the opportunities AI presents to upskill, re-train, learn and grow through improving the skills and knowledge of your workforce.

• Explore the possibilities of AI to enhance your learning and development offer.

The Benefits and Risks of using AI in HR

AI’s ability to automate tasks, streamline processes and create efficiencies is of huge interest to HR teams large and small. Scepticism around the unknown and how implementing technology will affect people’s jobs is natural, however the benefits are abundant.    

Enhances productivity

Using AI can free up people resource to focus on more creative, innovative and empathic tasks. Software can automate and analyse people data and perform routine administrative processes in seconds compared to a human. Think of the time we humans lose to procrastination alone! That time is much more valuable when spent talking to employees and showing empathy understanding around sensitive issues.

Increases agility

Technology can help HR teams to adapt more quickly to changing business needs and workforce demands. Employee self-service software is a great example of using AI to respond quickly to colleague questions and requests. 

Removes unconscious bias

Artificial Intelligence can help HR teams to solve problems in a fair and balanced way. Technology should remove the emotion from decision making and eliminate human bias from problem solving, e.g. when screening and shortlisting candidates for a role.  

Informed decision making

AI takes the guesswork out of decision making, helping to identify patterns and predict future trends. This allows HR teams to forecast more accurately and respond to demands before they arise, e.g. strategic planning and workforce resourcing.

Risks

Implementing AI in HR is not without its risks. Having an awareness of these is key to getting it right. A shortage of AI skills shortages is perhaps one of the biggest issues the UK faces right now. AI skills are in demand and the gap between the skills employers need and those employees have is widening.

Bad data

Quality data entry is essential. You get out what you put in. AI wants to help us solve problems with its learning capabilities so you need to train the algorithm to understand your exact requirements and produce reliable results.

Possible bias

While technology is designed to remove potential bias from decision making, it is not without its faults. In 2015, Amazon had to a scrap an algorithm they were using to hire employees when they realised it was discriminating against women applicants. This shows us that checking the results and outcomes of an automated process is critical.

Security issues

Every organisation has a responsibility to manage and store employee data safely and securely. Always seek advice from a GDPR professional before implementing any new form of technology. The risk of cyber criminals targeting your organisation is real, so take every possible step to mitigate against this. 

Over-reliance

Becoming dependent on AI to perform tasks is a real possibility. HR teams should seek to find a balance between efficient use of AI and human interaction.

Misinterpretation

AI tools are useful to help generate content, but be wary of the impact and accuracy of the words and tone you choose. Proofing and sense checking the messaging produced by AI is crucial.

Who is responsible for the use and performance of AI in HR?

To implement AI in an ethical way, you must seek professional legal and compliance advice. If you don’t have such resource internally, seek advice from reputable external sources.

Bring together representatives of all the departments or functions in the organisation that need to be involved, and decide between you who will take overall responsibility for the correct implementation and safe use of the technology. AI isn’t a solution you can introduce quickly. Take it slowly and talk about it gently and openly so employees have time to get used to the idea.

When it comes to adopting and integrating AI into your systems and procedures, people will naturally have lots of questions. If you are the person responsible for leading on its introduction, be prepared to respond to any concerns.

AI Policies and Procedures

No matter where you work, every employee needs clear guidance to ensure the safe, informed and transparent use of AI. Your organisation needs a clear policy around the use of AI at work to protect against cyber crime and prevent data security breaches.

Employees need direction around when it is appropriate to use and not use AI, for example it’s acceptable to use it to answer a commonly asked question, but not to manage and respond to an employee grievance. They also need to be informed about their own responsibility to protect personal data, i.e. they can’t suddenly start uploading data to external web applications without permission.

What a ‘Using AI in HR’ policy should cover

• Outline your team’s approach to the use of AI, and the circumstances and situations where it is acceptable to use the technology.

• Guide employees on the platforms they can and cannot use, and the consequences of misuse.  

• Set out the rules to control legal, commercial, and reputational risks that may arise from the use of AI, such as personal data breaches, loss of confidential information, and decision-making based on inaccurate data.

As with all company policies, you should review and update it annually to ensure it remains fit for purpose and reflects changes in legislation. Don’t forget to update other linked policies at the same time! Please get in touch to request a review of your digital people policies.

The importance of training and education

Research by online survey provider SurveyMonkey in February 2024 found that over half of British people don’t feel comfortable with HR teams using AI. This highlights the importance of clear governance, training and education.

Not everyone welcomes change with open arms and this is completely normal. Employees may instinctively fear for their job prospects or focus on the safety risks over future benefits. Knowledge is power and education will help to eliminate the fear factor. Training can equip employees with future-proof skills and knowledge and instill trust and belief in new technologies. 

An opportunity for growth and development

Before introducing AI into HR, your team needs to be trained to maximise its potential and embrace it in their role. According to research by Ricoh, only one in six (16%) European companies have offered their employees training on how to utilise AI tools. Without proper training and guidance on how to harness AI, businesses could miss out on its productivity and business benefits. Communication around the benefits is also key. Employees need to understand what’s in it for them before they consider getting on board. Allaying concerns about roles being replaced by AI is a crucial first step.

In reality, employees may already be using the technology they view as a threat. The same research by Ricoh Europe found that 48% of European employees use AI tools, such as Chat GPT, with 18% using it once or more a day. There will always be a requirement for human intervention with AI technology, especially during the development phase when robust audits and quality checks will help software learn to spot errors.

Regular open discussions with your team will also be important to understand how AI is working and how you can adapt systems to suit your team’s requirements. These moments are also an opportunity to share best practice and learn from each other.

Contact us

It is possible to embrace AI in HR and still be human! If you would like to discuss any of the issues covered in this ebook, or require extra HR support, get in touch with our team of professionals today. We’re here to help. Call us on 0161 941 2426 or email p3advice@p3pm.co.uk