Helping HR Departments Minimize Risk When Using AI Tools in Hiring
Human resources (HR) departments are progressively turning to artificial intelligence (AI) tools to assist in the process of recruiting and vetting job applicants. AI vendors claim that their tools can quickly and seamlessly identify the best candidates for open positions. Despite such claims, these tools have the potential to perpetuate stereotypes, disparately impact certain populations, and present troublesome issues relating to people with disabilities—leaving employers vulnerable to class or collective actions.
Epstein Becker Green understands both the promise and pitfalls of AI, and our attorneys have experience counseling clients on how to maximize the benefits of AI in recruitment and selection while minimizing potential risks. Recently, two clients—a major financial institution and a restaurant chain—sought Epstein Becker Green’s help in evaluating AI vendors for their employee recruitment, selection, and onboarding functions. Our attorneys assisted our clients in assessing the product offerings, reviewing vendor contracts, identifying the appropriate questions to ask the vendors about their AI products, monitoring and testing those products, and evaluating whether those products would raise red flags from a legal perspective.
Protecting Companies That Use Chatbots for Certain HR Functions
Increasingly, companies are using “chatbots” for lower-level human resources (HR) functions, such as tracking employees’ paid time off, leave, or benefits. (A “chatbot” is a computer program that uses artificial intelligence (AI) to simulate conversation with human users—for example, a chatbot may appear in a pop-up window on a website that asks whether a visitor needs any assistance.) Some companies are even evaluating whether they should complement humans with chatbots to take in internal complaints of discrimination or harassment. Although management and HR personnel may embrace chatbots to increase efficiency and reduce subjectivity, there are legal risks involved with adopting this technology.
Epstein Becker Green provides advice and counsel to clients that use, or are considering using, chatbots and want to mitigate their legal risks. We recently assisted clients in the retail and financial services industries with their chatbots. Our attorneys evaluated the questions asked by these chatbots to ensure that the algorithms, among other things, are able to distinguish between various types of employee requests—such as requests for sick leave, Family and Medical Leave Act leave, a regular day off, or an accommodation under the Americans with Disabilities Act. In addition, we made sure that our clients' chatbots have built-in processes to elevate certain matters for human review and are creating a favorable experience for employee-users.
Defending Ambulatory Surgery Center Against Lawsuit by Former Physician-Members
Ambulatory surgery centers (ASCs) have become a large and growing feature of the health care industry. (ASCs offer same-day surgical care, including diagnostic and preventive procedures, and can provide a more convenient and lower-cost alternative to hospital-based outpatient procedures.) ASC sale/acquisition activity has intensified over the past few years.
Epstein Becker Green has substantial experience representing ASCs in sales and acquisitions—and defending ASCs when their corporate transactions and decision-making are challenged. For example, in November 2018, Epstein Becker Green obtained a significant victory for an ASC client located on the East Coast of the United States. From the fall of 2017 through the spring of 2018, we represented our client in a transaction involving the sale of a controlling membership interest to a company that develops and operates ASCs and surgical hospitals nationwide (“Purchaser”). During the diligence phase of the transaction, five former physician-members, who had departed our client’s practice months before, asserted that they had been improperly forced out and sought a portion of the proceeds of the sale to the Purchaser. Those individuals then filed an action with the American Arbitration Association, asserting claims of breach of fiduciary duty, constructive fraud, negligence, and violation of the relevant state’s Blue Sky Law. The allegations asserted significant contentious issues regarding the ramifications of non-competition agreements between the parties. The claimants sought the return of their equity in our client, the value of their equity had they not departed our client, and other compensatory damages, totaling several million dollars.
Epstein Becker Green vigorously defended the lawsuit, which went to a five-day hearing only 90 days after the Statement of Claim was filed. The arbitrator’s lengthy decision resoundingly found in favor of our client on all counts. The arbitration clause in the parties’ agreement contained a “prevailing party’s provision,” enabling our client to seek repayment of its attorneys’ fees and costs from the claimants.
Frank C. Morris, Jr., and Nathaniel M. Glasser represented our client throughout the arbitration, with assistance from E. John Steren, Kathleen M. Williams, and Jonathan Hoerner.