Best Practices for HR to Embrace Generative AI Responsibly

The integration of generative AI in the workplace is gaining momentum, but many companies still lack clear policies to manage its use, which poses significant risks. 

Littler’s 2024 AI C-Suite Survey Report reveals that fewer than half of businesses surveyed have policies governing generative AI, highlighting a critical gap in AI governance. This is because CEOs and other top executives are concerned about the potential for lawsuits, particularly related to copyright violations, data privacy issues, and the inherent biases that AI systems can introduce. This concern is not unwarranted, as the legal environment surrounding AI remains unclear and fragmented across states, but it also puts companies behind their competitors in many cases.

A key report finding shows that 85% of executives worry about litigation stemming from generative AI, especially in HR departments, where AI tools automate processes such as resume screening and job description creation. 

There’s a fear that AI could inadvertently perpetuate bias in these instances, leading to discriminatory practices. Companies are being encouraged to act cautiously, with many opting to either ban AI entirely or limit its use to areas where they feel they can mitigate potential legal risks. This cautious approach often stems from the fact that current regulatory frameworks need to be more robust to fully address the nuances of AI-generated decisions and outcomes.

Despite these concerns, there may be better solutions than banning generative AI for HR professionals or other business leaders. There are compelling reasons to encourage the responsible use of AI, including increased efficiency, improved decision-making, and cost savings. 

When used correctly, generative AI can automate repetitive tasks, freeing HR professionals to focus on more strategic initiatives, such as employee engagement, retention, and talent development. Best practices involve carefully balancing these benefits with the need for ethical AI usage, fairness, and compliance.

Encouraging the Use of Generative AI In HR

While some companies may hesitate, there are several reasons why HR professionals should encourage the use of generative AI in their departments. 

First and foremost, generative AI can dramatically reduce the time spent on routine tasks such as resume screening, job postings, and even drafting performance reviews. Automation in these areas allows HR teams to focus on higher-level tasks that require human empathy and insight, such as improving workplace culture or spearheading diversity, equity, and inclusion initiatives.

Moreover, AI can help reduce human bias when appropriately monitored. While AI has the potential to replicate existing biases within datasets, tools can also be designed to flag biased language or patterns, helping HR professionals make more objective hiring decisions. However, teams must ensure that AI systems are continually audited for fairness and that flagged biases are corrected promptly.

Lastly, as employee expectations shift towards greater transparency and accountability, AI can help create more structured, transparent, and equitable workplace processes. 

For example, employees might have concerns about how their performance is evaluated or whether promotions are fairly awarded. By incorporating AI tools, HR can offer consistent, data-driven insights into performance and development, fostering a more transparent environment.

Best Practices for HR Professionals

To effectively incorporate AI into HR practices, HR professionals must follow several best practices:

1. Establish a Clear AI Policy: Fewer than half of companies currently have an AI policy, leaving many vulnerable to potential lawsuits or misuse. HR departments must collaborate with legal and compliance teams to create robust AI policies that define where, how, and when AI tools should be used. These policies should address data privacy, bias mitigation, and transparency while ensuring compliance with existing employment laws.
2. Regularly Audit AI Systems for Fairness: AI tools are only as good as the data on which they are trained. Therefore, HR professionals must routinely audit AI systems to ensure that they are producing fair and unbiased results. This includes checking the AI’s outputs and reviewing the data inputs to ensure that the data used to train the AI is free from bias. Such audits should be conducted regularly, with any necessary adjustments to improve fairness and compliance.
3. Provide Employee Training on AI Tools: AI adoption may be slow due to a lack of understanding among employees. HR professionals should take the lead in providing comprehensive training to all employees on how AI tools work, how they are used within the company, and how employees can benefit from them. Educating staff on the responsible use of AI will help foster trust and ensure that AI tools are used appropriately.
4. Maintain Human Oversight: While generative AI can be a powerful tool for automating tasks, HR professionals must maintain human oversight in decision-making processes. AI should be used to augment human capabilities, not replace them. Decisions that affect people’s lives—such as hiring, promotions, or terminations—should always involve a human review to ensure fairness and empathy.
5. Be Transparent About AI Use: Transparency builds trust with employees and job applicants. HR departments should communicate how AI tools are used, particularly in hiring processes. By being upfront about AI’s role, HR teams can mitigate concerns about bias or unfairness while building a culture of trust.
6. Stay Informed About Evolving Regulations: The regulatory landscape surrounding AI is constantly changing, so HR professionals must stay informed about new laws and regulations that impact the use of AI in the workplace. This includes tracking developments at the local, state, and federal levels and keeping up with international guidelines if the company operates globally. Collaborating with legal teams to ensure that all AI tools comply with the latest regulations is essential.

Create a Formal Generative AI Policy

As generative AI becomes more integrated into workplaces, the lack of formal policies governing its use poses a significant risk for companies. While some organizations are wary of adopting AI due to concerns over legal exposure, banning AI outright is not the solution. 

Instead, HR professionals should encourage the responsible use of AI by developing clear policies, providing employee training, and maintaining human oversight. By following best practices, companies can harness the power of AI while mitigating risks and ensuring fairness in the workplace. 

HR departments can create a more efficient and equitable workplace by conducting ongoing audits, being transparent, and committing to ethical AI use.

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