Can employers use AI to shortlist job candidates?

In recent years, artificial intelligence (AI) has become an increasingly popular tool for employers to streamline their hiring processes.

From automating screening, CV-ranking, keyword matches and video analytics, AI promises faster shortlists, consistency and efficiency with an ability to reduce human bias. However, as with much technological advancement, its use raises important legal questions, particularly in relation to data protection laws.

So, can employers legally use AI to shortlist job candidates in the UK? The short answer is yes, but with several key considerations to ensure compliance with legal frameworks, especially those concerning data protection and non-discrimination.

Data protection and privacy concerns

The cornerstone of any AI-driven recruitment process in the UK is adherence to the UK General Data Protection Regulation (GDPR).

GDPR gives candidates the right to challenge decisions made by AI that have had a significant effect. This regulation governs how personal data is collected, processed, and stored. AI systems typically rely on vast amounts of data and in the case of hiring will likely involve personal data including CVs, interview videos and social media profiles, so employers must take several steps to ensure compliance with GDPR:

• Informed consent: employers must inform candidates that AI will be used in the recruitment process. This includes explaining what data will be collected, how it will be used and for how long it will be stored
• Data minimisation: employers should only collect and process data that is strictly necessary for the hiring process. AI systems should be configured to avoid processing irrelevant or excessive amounts of data
• Transparency and accountability: candidates must have clear information on how AI makes decisions. If a candidate is not shortlisted, they have the right to request feedback or an explanation, especially if they suspect bias or discrimination in the process.
• Data subject rights: candidates must be informed of their rights under GDPR, including their right to access, rectify and erase personal data. Employers must provide a mechanism for candidates to exercise these rights.

Non-discrimination and fairness

The use of AI in recruitment may raise concerns about fairness and non-discrimination. The Equality Act 2010 bans any practice that puts a protected group at a disadvantage unless it can be objectively justified by the employer. If not carefully managed, AI algorithms can perpetuate existing biases or even introduce new ones. For example, if the data used to train the AI system is biased (by favouring candidates from certain demographic groups or backgrounds for instance), the AI could unintentionally discriminate against underrepresented groups.

Employers must ensure that their hiring practices do not discriminate on the basis of protected characteristics including age, gender, race, disability or sexual orientation. This means that AI systems must be regularly audited for bias, and employers should be prepared to intervene if discriminatory patterns emerge.

The Equality and Human Rights Commission (EHRC) has raised concerns about AI potentially exacerbating inequalities. Employers using AI for shortlisting should ensure that the AI’s decisions are explainable and justifiable, making it easier to demonstrate compliance with non-discrimination laws.

Human oversight and accountability

While AI can assist in shortlisting candidates by filtering large volumes of applications, it is crucial that human oversight remains a key part of the decision-making process. AI should not fully replace human judgment but rather act as a tool to support it. Employers should ensure that human recruiters or HR professionals are involved in the final decision-making and can override AI recommendations if necessary.

Additionally, employers should keep records of how AI systems are used, ensuring that any decisions made by AI are traceable and can be reviewed. This is important both for transparency and in case of complaints or legal challenges.

Legal risks and recommendations

Employers must remain aware of the potential legal risks associated with AI-based recruitment. These risks could include breaches of data protection laws, allegations of unlawful discrimination and the failure to comply with transparency obligations.

Employer considerations

To mitigate the risks of using AI to shortlist, employers should:

• Conduct regular audits of their AI systems to ensure compliance with GDPR and the Equality Act
• Seek legal advice to understand the implications of AI in recruitment, particularly regarding data privacy and anti-discrimination laws
• Provide adequate training for HR staff to understand both the capabilities and limitations of AI, ensuring that human judgment is always a part of the recruitment process.

Using AI to shortlist job candidates in the UK is allowed, but it requires employers to navigate a complex legal framework. Employers selecting which software to use should select tools that are well-regarded in the UK market and ensure they are compliant with data protection legislation.  The Information Commissioner’s Office has a useful post on employer considerations when procuring AI tools to help with recruitment https://ico.org.uk/about-the-ico/media-centre/news-and-blogs/2024/11/thinking-of-using-ai-to-assist-recruitment-our-key-data-protection-considerations/

By ensuring legal compliance, employers can leverage AI to enhance their recruitment processes, more quickly weed out unsuitable applications and identity talent.