State Authority to Regulate Artificial Intelligence in Employment Decisions

This opinion from the California Attorney General examines the state's authority to regulate the use of artificial intelligence and automated decision-making tools in employment contexts. It analyzes existing antidiscrimination statutes, the California Consumer Privacy Act, and the state's Fair Employment and Housing Act as applied to AI-driven hiring and promotion decisions.

The opinion discusses the legal theories under which employers may be held liable for discriminatory outcomes produced by AI tools, including disparate impact analysis and the duty to validate selection procedures. It examines federal preemption considerations and the relationship between state regulation and federal antidiscrimination law.

The opinion concludes that California has substantial authority to regulate AI in employment, recommending that employers conduct regular bias audits, provide notice to applicants and employees when AI tools are used, and maintain records sufficient to demonstrate compliance with antidiscrimination requirements.