California lawmakers recently missed the chance to pass a major bill that would have set new rules for the use of artificial intelligence (AI) in employment decisions. The proposed law, Assembly Bill 2930 (AB 2930), aimed to protect workers from AI-related discrimination by requiring employers to notify employees when AI was used for key decisions like hiring, promotions, or pay. The bill also called for stronger oversight, requiring employers and AI developers to implement systems to prevent biased outcomes. However, the bill didn’t pass this legislative session, with lawmakers unable to finalize it before the deadline.
Although the bill failed, it’s likely to come up again in 2025, meaning employers may still need to prepare for potential changes ahead.
For additional information regarding AI regulations and to find out how this could impact your business, please contact our Managing Partner, Richard Liu, at richard.liu@consultils.com.
What AB 2930 Would Have Changed
If AB 2930 had passed, it would have introduced new rules affecting both employers and AI developers. Here’s a breakdown of the main changes:
Notice Requirement: Employers using AI for important decisions, like hiring or firing, would need to inform employees or job applicants. Workers could also request alternative, non-AI methods for making these decisions.
Impact Assessments: Employers and AI developers would have to perform assessments of their AI systems before using them and repeat these annually. These assessments would check if the AI was working fairly and reliably and would need to be reported to the state each year.
Governance Programs: The bill would require companies to create governance programs to monitor AI systems and prevent discrimination.
Had this bill passed, California would have become one of the leading states regulating AI in the workplace. Though it didn’t move forward this year, employers should be prepared for similar regulations to resurface soon.
Other AI Measures Moving Forward
While AB 2930 didn’t make it through, three other AI-related bills are on their way to Governor Gavin Newsom’s desk for approval. These measures could also impact employers in various industries:
AI Safety Act (SB 1047): This bill requires AI developers to take steps to ensure their technology doesn’t pose risks to public safety, including the potential for misuse in cyberattacks or dangerous activities. While it primarily affects large AI companies, it could also indirectly impact the availability of AI tools that many businesses rely on.
Digital Replicas in the Entertainment Industry (AB 2602): This bill regulates the use of digital replicas in the entertainment sector, requiring clearer contracts when AI-generated images or voices are used in place of real individuals. It aims to protect workers from being replaced without proper consent or compensation.
State AI Accountability (SB 896): This bill focuses on AI use by state agencies, requiring risk assessments and transparency when AI is used in public communications. While it targets state operations, it reflects a growing emphasis on AI accountability that could influence private-sector practices.
What Employers Should Do Now
Although AB 2930 didn’t pass, employers should still be proactive. AI regulations are likely to come back in California and other states, so businesses that use AI for employment decisions need to make sure their systems are fair and free from discrimination. It’s a good idea to start by reviewing how you currently use AI in the workplace. Conduct internal audits to check for potential bias and ensure you’re transparent with employees about how these systems are applied. Taking these steps now can help keep your business compliant and ready for future regulations.
For additional information regarding AI regulations and to find out how this could impact your business, please contact our Managing Partner, Richard Liu, at richard.liu@consultils.com.
Disclaimer: The materials provided on this website are for general informational purposes only and do not, and are not intended to, constitute legal advice. You should not act or refrain from acting based on any information provided here. Please consult with your own legal counsel regarding your specific situation and legal questions.
Richard Liu, Esq. is the Managing Counsel of ILS. He serves clients as a management-side defense lawyer specializing in employment and business litigation. Richard is also an expert on litigation prevention and compliance. He regularly advises Fortune 500 companies and startups on employment, labor, and commercial matters.
Email: richard.liu@consultils.com | Phone: 626-344-8949
*Disclaimer: This article does not constitute legal opinion and does not create any attorney-client relationship.
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