Sweeping AI Executive Order Has Labor Implications for Employers
by John Ayers-Mann and Jennifer Mora
Seyfarth Synopsis: On October 30, 2023, the Biden Administration issued a sweeping order on artificial intelligence. Among its numerous provisions, the Order touches on several issues of interest to employers. For employers with labor-related concerns in particular, the most significant provision could be the impact of the provisions relating to surveillance of workers. The Executive Order comes nearly one year after the National Labor Relation Board’s General Counsel issued guidance on the use of artificial intelligence in the context of managing employees, and employers should be aware of increased focus from federal agencies on worker surveillance.
On October 30, 2023, President Joseph Biden authored a new executive order, titled “Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence.” The Order addressed a variety of artificial intelligence (“AI”) related issues, from developing guidelines for protecting national infrastructure from cyber-attacks to the use of AI in the implementation of public benefits and services. Among its various provisions, the Executive Order touches on several issues of interest to employers, including AI enforcement from civil rights agencies, the intersection of AI monitoring and worker protections, and the use of AI by federal contractors.
For employers with labor concerns in particular, one of the most salient issues is the increased regulation of employer monitoring that may arise from the Executive Order. In Section 6, the Executive Order instructs the Secretary of Labor to “develop and publish principles and best practices for employers” that shall include specific steps for employers to take with regard to “labor standards and job quality, including issues related to the equity, protected-activity, compensation, health, and safety implications of AI in the work place” and “AI-related collection and use of data about [employees], including transparency, engagement, and activity protected under worker-protection laws.” In that same section, the Executive Order instructs the Secretary of Labor to “issue guidance to make clear that employers that deploy AI to monitor or augment employees’ work must continue to comply with protections that ensure that workers are fairly compensated for their hours worked…and other legal requirements.”
The Executive Order purports to give the Department of Labor wide latitude to regulate employer use of AI in monitoring and tracking employee activity. Increased regulation by the Department of Labor and the National Labor Relations Board (“NLRB”) could pose liability risks for both unionized and non-unionized employers. In particular, the Executive Order contains a vague, blanket grant of authority to regulate AI as it relates to “activity protected under worker-protection law[s],” which could portend further regulation of the intersection of AI and protected concerted activity under the National Labor Relations Act (“NLRA”). Indeed, the General Counsel has already shown interest in cracking down on employers who use AI or algorithm-based software to monitor employees. Nearly a year ago to the day from the Executive Order, NLRB General Counsel (“GC”) Jennifer Abruzzo issued Memorandum GC-23-02, which set forth a broad and amorphous framework for regulating algorithm-driven management practices that might interfere with employees’ protected activities under the NLRA. President Biden’s newly issued Executive Order is likely to ensure that the Department of Labor, and the NLRB GC in particular, continue to focus upon the intersection of the NLRA and AI-driven innovation in the workplace, including by developing frameworks for legal liability similar to those set forth in the GC’s recent guidance memorandum.
Given the wide range of activities the Executive Order purports to regulate, employers can expect a significant uptick in AI-related regulation by federal agencies in the coming years. Employers with questions should reach out to their labor counsel for assistance.
