More than half of employers use AI in HR, despite litigation worries
Fifty-four percent of employers are deploying AI tools in their human resources and cybersecurity functions, according to Littler's 14th Annual Employer Survey. The adoption spans multiple departments, with 52% using AI in marketing, sales, and communications, and 48% in legal and compliance.
Yet 79% of employers express concern about AI-related litigation. Their worries center on data privacy for employee and candidate information, discrimination or bias in hiring and performance evaluation, and compliance with emerging state and local AI regulations.
Workforce cuts tied to AI adoption
Eleven percent of employers have already reduced their workforce because of increased AI use. Another 4% have cuts underway, while 22% are considering reductions.
Wrongful termination claims pose a particular risk. Some 15% of employers worry about litigation over AI-based termination decisions and layoffs, especially as labor unions increasingly target AI in contract negotiations.
Policies lag behind deployment
Sixty-eight percent of employers have introduced formal policies governing AI use in the workplace. Fifty-five percent have implemented formal review or approval processes for AI tools, and 54% restrict what information employees can input into them.
Niloy Ray, co-chair of Littler's AI and Technology Practice Group, said the gap between adoption speed and governance creates exposure. "AI adoption is moving quickly, but governance is still playing catch-up," Ray said. "That mismatch could leave employers vulnerable to significant risk."
Eighty-four percent of respondents expect their business will face impacts from AI-related policy or regulatory changes within the next 12 months.
For HR professionals managing these risks, understanding both the operational benefits and compliance requirements of AI tools is essential. AI for Human Resources covers practical applications and governance considerations, while the AI Learning Path for CHROs addresses strategy and policy implementation at the executive level.
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