How AI’s rapid evolution impacts global HR

Over the past decade, AI technology has rapidly evolved, in particular during its latter half, spurred by the impacts of the pandemic. No longer the stuff of science fiction or confined to labs or alarmist news headlines, AI is now in use across almost every industry, with workers at all levels coming face-to-face with instances of this new technology.

In 2021, reports stated that 34% of UK organisations had increased their reliance on AI technologies since the pandemic. This was largely a result of the growing reliance on digital   infrastructure and virtual forms of working and communication due to the sudden need for remote work.

The Fourth Industrial Revolution

The rapid growth of AI is being referred to by many as the Fourth Industrial Revolution. Building on the Third Industrial Revolution, which saw electronics and technology becoming widely used, this new era of technology is expected to revolutionise the working world in a comparatively groundbreaking fashion, overhauling industries to create entirely different modes of working and production.

The World Economic Forum (WEF) notes that this new era will yield many benefits, including falling transportation and communication costs, the increased efficiency of logistics and global supply chains, and the decreasing cost of trade, “all of which will open new markets and drive economic growth.”

Concerning speed

Despite the myriad positive outcomes predicted and the seemingly instantaneous ubiquity of AI, concerns around the rapid evolution of this new technology have consistently been raised.

As the WEF goes on to highlight, some economists have indicated the potential for this new era to foster greater inequality, due to disrupting labour markets through the automation of many roles, thus boosting the economy while resulting in the displacement of workers. It is predicted that AI could cause the displacement of 85 million jobs, while creating 97 million more.

Concerns surrounding the ethics of AI abound. This is due mainly to the fact that serious instances of bias have been observed in AI when, for example, being used to screen job applicants. Many cases of racial bias in AI have been recorded as a result of a lack of diversity and bias amongst the pool of AI data trainers, including AI being unable to recognise Black faces.

HR is one area in which AI is being used to automate processes such as candidate screening and hiring. In such instances, in addition to issues of bias becoming apparent, questions about data privacy arise, as prospective and existing employee data is input into AI systems, prompting issues around data protection.

AI awareness among HR professionals

Deloitte notes that more than two-thirds of business leaders view AI as crucial to the future of their businesses (Deloitte, 2020), and 93% of organisations in the US and UK view AI as a business priority and are developing organisational goals around it.

The current skills gap is so great that just 27% of business leaders are confident that their non-technical workforce is sufficiently skilled in using new technology and an estimated 40% of the workforce will be compelled to reskill in the next three years as a result of the rise of AI. However, only half of workers are seen to have access to adequate training opportunities today.

AI restrictions and acts

Testifying before the United States Senate in July of 2023, CEO of AI company Anthropic, Dario Amodei, told the hearing entitled ‘Oversight of A.I.: Principles for Regulation,’ that “the single most important thing to understand about AI is how fast it is moving.”

As a result, governments around the world are scrambling to enact legislation to control AI and ensure its use is well regulated.

China was the first country to implement laws around the most common applications of AI, in 2021 and 2022. According to the Carnegie Endowment for International Peace, these laws “formed the foundation of China’s emerging AI governance regime, an evolving policy architecture that will affect everything from frontier AI research to the functioning of the world’s second-largest economy, from large language models in Africa to autonomous vehicles in Europe.”

In Europe, new AI legislation was written into EU law in July 2024. Referred to by experts as a “highly impactful piece of legislation”, requiring an immediate response from businesses, the proposals for the EU AI Act were first published in 2021, but will not come into effect until August 2024.

Under the risk-based AI Act, certain AI uses are prohibited, including cognitive behavioural manipulation, social scoring, AI for police profiling, and “systems that use biometric data to categorise people according to specific categories such as race, religion, or sexual orientation.”

The new legislation applies to providers of AI systems; deployers of AI systems; providers and deployers of AI systems; where the output produced by the AI system is used in the EU; importers and distributors of AI systems; product manufacturers; authorised representatives of providers; and all other affected persons within the EU.

In the USA, where much of today’s AI technology is in development, there is currently no comprehensive legal framework for AI. However, AI is referenced in a number of federal laws – such as the Federal Aviation Administration Reauthorization Act, which requires the review of AI usage in aviation – as well as guidelines such as The White House Executive Order on AI which states that “harnessing AI for good and realising its myriad benefits requires mitigating its substantial risks.”  Other guidelines include The White House Blueprint for an AI Bill of Rights. At present, there are several proposed AI laws in the works, including the REAL Political Advertisements Act,aiming to regulate generative AI in political advertisements and the Stop Spying Bosses Act, to regulate employers surveilling employees using AI. On a state level, states such as Colorado and California have introduced acts to control and regulate the usage of AI. 2023 saw in excess of 40 state AI bills introduced.

What HR professionals need to know

Those working within the field of HR are responsible for keeping up to date with all relevant HR guidelines and legislation in their country or countries of operation. If working for a global organisation, this can mean ensuring 100% compliance across multiple jurisdictions.

Other key considerations include:

Data protection

Keeping abreast of GDPR and data protection is crucial in general, but specifically when it comes to sensitive employee data being handled by AI. Improper handling of such data, including breaches or leaks, can lead to lawsuits, heavy fines, and even more severe penalties.

ED+I and ethics

Looking out for instances of discrimination and bias in AI programmes is also key, because, as previously mentioned, AI has been known to discriminate on the basis of race and gender. Ensuring all content output is in line with AI laws is important, as there may be regulations pertaining to AI-produced content in your region.

Transparency

When engaging AI in any decision-making process, it is harder to keep track of the methods used to reach the final conclusion, which can in turn create issues if the decision is challenged, or raises concerns among employees. HR leaders must be always involved in important decision-making in order to achieve full transparency, ensure ethical and fair treatment of all involved, and be able to create reports pertaining to the decision-making processes.

There is so much to consider in each location, you may wish to engage the services of a global employment solutions provider to help you navigate the often-complex terrain of the international AI landscape.

How Mauve can help

Mauve Group have been active in the field of global HR and employment for over 28 years. Our team of experts include colleagues with decades of experience in global compliance. Pioneers of the Employer of Record model, Mauve Group knows first-hand the challenges which can come with operating in numerous countries and is ready and waiting to support your organisation with every step of your expansion journey. Contact us today.