Highlights:

1. Data privacy and security pose challenges when using ChatGPT and generative AI in the workplace.
2. Bias in hiring and evaluations can arise from the use of generative AI tools.
3. Employee handbooks should be updated to address the use of AI tools and data confidentiality.

The use of artificial intelligence (AI) tools to make the workplace (and our daily lives) more productive, efficient and even enjoyable is not new. The predictive text makes crafting an email or presentation easier, proofreading software streamlines our review of long documents, and voice-command features make getting from Point A to Point B a breeze. ChatGPT and generative AI programs are the latest virtual assistants, and their usefulness seemingly has no bounds. It is no wonder that articles featuring the many ways ChatGPT can be used have flooded our inboxes and social media feeds.

Like most things, using ChatGPT and generative AI tools does not come without risk — professional, technological, and, importantly, legal. However, before you close this article and move on with your day, know that you can have your cake and eat it too. That is to say, with a healthy understanding of the associated legal implications and risks (two are listed below), employers can welcome ChatGPT, OpenAI, and other generative AI tools in the workplace with open arms.

Generative AI’s Legal Implications and Risks

Data privacy and security. Tools like ChatGPT and OpenAI are developing rapidly, and, like any internet platform or software, there is no guarantee of data security. Proprietary or confidential information about an employer’s practices, employees or other aspects of a business, even if not retained by the platform, might end up in the wrong hands in the event of a data breach or other cybersecurity event.

Similarly, because ChatGPT and other tools “learn” from each conversation or bit of information loaded to their platform, employees using AI to complete tasks in the workplace may be inadvertently accessing another person or business’s trademark, copyright or intellectual property, creating legal risk for employers.

Bias in hiring and evaluations. Generative AI tools are increasingly useful in making employment decisions at every stage of the job life cycle, from candidate sourcing and screening candidates’ LinkedIn profiles to using facial analysis software to assign traits and qualities to job applicants’ facial expressions during video interviews.

Neither the Equal Employment Opportunity Commission (EEOC) nor federal law regulates the use of AI for these purposes, for now, but legal risks abound. The use of AI tools in hiring might disproportionately impact one racial or gender group over another, as machine learning prompts an employer’s candidate selection software to favor a specific skill or facial feature over another.

Similarly, AI tools could inadvertently narrow an employer’s candidate pool over time, as they skew toward recruiting from one university or professional association over another. The use of any selection procedure or AI tool that has an adverse impact on the hiring, promotion or employment of members of a particular race, sex or ethnic group is discriminatory and could expose employers to EEOC complaints and other legal action. Employers must be mindful of this and should review generative AI tools to ensure they do not have a disparate impact on individuals in protected classifications, including, but not limited to, race, gender, ethnicity, national origin and age.

Tips and Policies for Using Generative AI Tools

Legal challenges aside, ChatGPT and generative AI tools are likely here to stay. Employers can adapt to this new wave of technology and consider adopting the following policies to address these concerns.

Review and update employee handbooks. Most employers have an employee handbook or other document that sets forth the company’s workplace policies and expectations for employee conduct. Employers should review their employee handbooks to ensure the provisions governing the use of computers or other software, confidentiality of company information, and return of property upon leaving the company address information shared with generative AI platforms like ChatGPT.

Review the terms of use. As noted above, generative AI tools do not guarantee data privacy and security. Employers and employees alike should avoid sharing any confidential or sensitive information with an AI tool. Employers should also review the terms of use for AI tools to ensure there are clear terms governing the protection of data shared with the platform.

Be mindful of bias. To the extent an employer is using AI tools to streamline the employee hiring, evaluation and separation process, employers should regularly review results for evidence of bias. If bias is uncovered, employers should take immediate steps to address it. Employers should also reiterate their equal employment opportunity and/or diversity, equity, and inclusion policies to ensure employees using AI tools in hiring have them top of mind.

Author Bio

Shaniqua L. Singleton is a Senior Associate at Nelson Mullins, who represents employers on a broad range of matters. She is also experienced in pre-trial aspects of litigation, including deposing plaintiffs and other witnesses, drafting motions and briefs, participating in voir dire, arguing motions in limine, and preparing for trial.

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