On Thursday May 18, 2023, the Equal Employment Opportunity Commission (“EEOC”) released a new technical assistance document titled Assessing Adverse Impact in Software, Algorithms, and Artificial Intelligence Used in Employment Selection Procedures Under Title VII of the Civil Rights Act of 1964. The document was released as a part of the EEOC’s Artificial Intelligence and Algorithmic Fairness Initiative and outlines considerations for incorporating automated systems into employment decisions. EEOC Chair Charlotte A. Burrows called the technical assistance document “another step in helping employers and vendors understand how civil rights laws apply to automated systems used in employment.”

The document assesses whether an employer’s selection procedures (the procedures it uses to make employment decisions such as hiring, promotion, and firing) “have a disproportionately large negative effect on a basis prohibited by Title VII.” Essentially, whether the employment practice has a disparate impact on the basis of race, color, religion, sex, or national origin, as protected by Title VII.

The document encourages application of the Uniform Guidelines on Employee Selection Procedures (the “Guidelines”) to determine if any tests or selection procedures, including the use of an algorithmic decision-making tool, are lawful under Title VII’s disparate impact analysis.

The Questions and Answers section of the document provides interesting insight. The EEOC takes the position that use of an algorithmic decision-making tool that has an adverse impact will violate Title VII unless the employer can show the use is “job related and consistent with business necessity.” The EEOC states that an employer can be held responsible under Title VII for selection procedures that use an algorithmic decision-making tool if the procedure discriminates on a basis prohibited by Title VII, even if the tool is designed or administered by another entity, such as a software vendor. The EEOC affirms that if an outside entity has an employer’s authority to administer or use an algorithmic decision-making tool on its behalf, the employer may be held responsible for the actions. Therefore, employers are encouraged to ask vendors, before using an algorithmic decision-making tool, whether they have evaluated if the use of the tool causes a substantially lower selection rate for individuals with any characteristics protected by Title VII. However, even with the vendor’s assurance, the employer can still be held liable for any disparate impact or disparate treatment discrimination if the vendor is incorrect about its assessment. Further, the document explains that an employer developing a selection tool can take steps to reduce the impact or select a different tool to avoid violating Title VII. However, an employer may be liable if it fails to adopt a less discriminatory algorithm that was considered during the development process.

Notably, the EEOC does not address disparate treatment under Title VII or other stages of the disparate impact analysis including if an algorithmic decision-making tool can determine job-related traits or characteristics.

Print:
Email this postTweet this postLike this postShare this post on LinkedIn
Photo of Joseph O’Keefe Joseph O’Keefe

Joseph C. O’Keefe is a partner in the Labor & Employment Law Department and Co-Head of the Restrictive Covenants, Trade Secrets & Unfair Competition Group.

Joe is an experienced trial lawyer who, for more than 30 years, has litigated employment disputes of all…

Joseph C. O’Keefe is a partner in the Labor & Employment Law Department and Co-Head of the Restrictive Covenants, Trade Secrets & Unfair Competition Group.

Joe is an experienced trial lawyer who, for more than 30 years, has litigated employment disputes of all types on behalf of employers, before federal and state courts, arbitral tribunals (e.g. FINRA and AAA), and state and federal administrative agencies throughout the U.S. Joe has litigated employment-related lawsuits alleging breach of non-compete agreements, theft of trade secrets, discrimination, sexual harassment, whistleblowing, wage and hour violations, Title IX violations, breach of contract, defamation, fraud and other business related torts. Joe’s practice includes representing clients in complex class and collective litigation, including alleged violation of state and federal pay equity laws, violations of wage and hour laws and discrimination claims. Joe’s experience includes appellate work in both federal and state courts.

In addition to his extensive litigation practice, Joe regularly advises employers, writes and speaks on a wide range of employment related issues. He counsels clients concerning pay equity, use of Artificial Intelligence in the workplace, management of personnel problems, ADA/FMLA compliance, reductions in force, investigation of employee complaints, state and federal leave laws, wage and hour issues, employment policies and contracts.

Joe represents employers in a variety of industries including financial services, higher education (colleges and universities), pharmaceuticals/medical devices, health care, technology, communications, fashion, consumer products, publishing, media and real estate. He frequently writes articles concerning developments in the law and speaks at seminars concerning legal developments in the labor and employment law field.

Photo of Shanice Z. Smith-Banks Shanice Z. Smith-Banks

Shanice is an associate in the Labor and Employment Law Department. Her practice involves litigating claims of unlawful discrimination, harassment, retaliation and whistleblowing. Shanice assists in conducting workplace investigations related to discrimination, harassment, and retaliation. She also counsels clients from a variety of…

Shanice is an associate in the Labor and Employment Law Department. Her practice involves litigating claims of unlawful discrimination, harassment, retaliation and whistleblowing. Shanice assists in conducting workplace investigations related to discrimination, harassment, and retaliation. She also counsels clients from a variety of fields on a range of employment matters.

Shanice earned her J.D. from Loyola University New Orleans College of Law, where she was a Managing Editor of the Loyola University Journal of Public Interest Law and a member of the Trial Advocacy program. Immediately upon graduation from Loyola, Shanice argued a case on behalf of the Loyola Criminal Defense Law Clinic in front of the Louisiana Supreme Court.