In the News: Cara Crotty Provides Insight on Disparate Impact Claims for SHRM
Co-chair of Constangy’s EEO/Contractor Compliance, Reporting & Analytics and DEI Compliance practice groups, Cara Crotty, provided insight on how the Trump administration’s pivot away from disparate impact enforcement is creating uncertainty for employers. Despite this uncertainty, human resource professionals should not abandon adverse-impact analysis, validation studies, or other safeguards around employment decisions.
“Although federal enforcement priorities have changed, the legal risks associated with disparate impact remain substantial,” said Cara. “Employers face a more complex environment than ever before, particularly as AI becomes embedded throughout the employment life cycle, and state and local jurisdictions increasingly regulate automated employment decision-making.”
Rescission of the UGESP would not eliminate disparate impact claims. “Employers would simply lose the long-standing framework that has helped them evaluate their employment practices,” she explained.
When addressing how AI raises the stakes, Cara noted that employers should not assume that outsourcing a selection tool outsources the legal risk. “If a hiring tool screens out applicants in protected groups at disproportionate rates, plaintiffs will generally focus on the employer who used the tool to make the challenged employment decisions, not the vendor or developer,” she said. HR leaders should consequently understand how AI-enabled systems function, what data they rely on and whether independent validation has been conducted.
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