January 4, 2022Client Alert

EEOC Releases Guidance on Algorithms, Artificial Intelligence, and Disability Discrimination in Hiring

The U.S. Equal Employment Opportunity Commission (“EEOC”) released guidance on employer use of algorithms and artificial intelligence (“AI”) in the hiring and employee assessment processes to provide direction to employers on how they can avoid screening out applicants and employees with disabilities.[1]

Importantly, the EEOC guidance offers “promising practices” for employers to utilize to comply with the ADA when using AI, including the following:

Training staff to recognize and process requests for reasonable accommodations as quickly as possible. To request an accommodation, an applicant or employee is not required to specifically mention the ADA or use the phrase “reasonable accommodation”; rather, if an applicant or employee mentions that a condition may make it difficult to test or it may cause a test result that is less than acceptable to the employer, the EEOC considers this a request for a reasonable accommodation. Examples of reasonable accommodations can include specialized equipment, alternative tests or testing formats, and exceptions to workplace policies. The guidance notes that employers do not have to “lower production or performance standards or eliminate an essential job function as a reasonable accommodation.”

If using AI administered by a third-party entity authorized to act on the employer’s behalf, asking the entity to forward requests for accommodations promptly so the employer can process them. Employers may be held responsible for the actions of other entities that the employer has authorized to act on its behalf. For example, if an applicant was taking a pre-employment test that was administered by a third-party software vendor (authorized to act on the employer’s behalf) and the applicant were to tell the vendor that a medical condition was making it difficult to take the test (which qualifies as a request for a reasonable accommodation), and the vendor did not provide an accommodation as required under the ADA, the employer would likely be held responsible even though it was entirely unaware that the applicant reported a problem to the vendor or requested any accommodations. As such, it is important that if an employer is using AI administered by a third-party entity, the employer should ask the entity to forward any requests or feedback that might be considered an accommodation request promptly so the employer can address them. Alternatively, an employer could enter into an agreement with a third-party entity requiring it to provide reasonable accommodations on the employer’s behalf, in accordance with the employer’s obligations under the ADA.

Using AI that has been designed to be accessible to individuals with as many different kinds of disabilities as possible. AI can screen out individuals because of disability. “Screening out” occurs when a disability prevents an applicant or employee from meeting performance standards on a selection criterion and the applicant or employee loses a job opportunity as a result. For example, a chatbot (i.e., software designed to engage in communications online and through texts and emails) could be programmed with an algorithm that rejects applicants who indicate that they have a significant gap in employment history; however, if the individual’s employment gap were caused by a disability, the chatbot could potentially screen out the individual because of the disability.

Cautions employers against relying on “bias-free” claims. Importantly, the guidance notes that an employer cannot rely on claims that AI is “bias-free.” Even if vendors have taken steps to avoid Title VII bias (e.g., race, sex, etc.), these measures are typically distinct from steps needed to address disability bias. Steps employers can take to reduce the chance of screening out an individual because of a disability include clearly indicating that reasonable accommodations are available to people with disabilities, providing clear instructions on how to request accommodations, and providing applicants and employees undergoing any assessment that utilizes AI with as much information about it as possible.

Ensuring third-party vendor AI does not ask disability-related questions unless the inquiries are related to a reasonable accommodation request. AI cannot include unlawful disability-related inquiries or medical examinations. Prior to a conditional offer of employment, an employer could violate the ADA if it uses AI that “poses ‘disability-related inquiries’ or seeks information that qualifies as a ‘medical examination.’” An assessment includes “disability-related inquiries” if it asks applicants or employees questions that elicit information about a disability or directly asks if the applicant or employee is an individual with a disability; an assessment qualifies as a “medical examination” if it “seeks information about an individual’s physical or mental impairments or health.” However, once an individual’s employment has started, “disability-related inquiries may be made, and medical examinations may be required if they are legally justified under the ADA.”

With the use of AI increasing in the employment context, employers should be aware how the use of such technology could lead to unlawful discrimination. While the EEOC has just recently released this guidance, states and municipalities have started passing laws related to the use of AI in employment. For example, a New York City law will require employers to conduct bias audits for software-driven tools that substantially assist in making decisions to hire or promote; this law is currently scheduled to go into effect on January 1, 2023, with enforcement of the law delayed until April 15, 2023. Additionally, the Office of Federal Contract Compliance Programs has included questions regarding the use of AI in its most recent proposed scheduling letter and itemized listing.

We encourage you to reach out to one of the authors listed below or your Michael Best attorney with any questions or inquiries related to this update.

[1] On the same day that the EEOC released its guidance, the U.S. Department of Justice released similar guidance related to the use of algorithms and AI in hiring, also focusing on disability discrimination.

back to top