While the California legislature continues to consider a bill that would regulate artificial intelligence (AI) in the workplace, the state's Civil Rights Council stepped in, approving amendments to the Fair Employment and Housing Act (FEHA) that regulate employment decisions using AI.
The final regulations are the result of a series of public hearings, input from experts and the public, and federal reports and guidance. The regulations apply to employers with 5 or more employees with at least one in California, regardless of location, including part-time and seasonal workers.
Starting October 1, 2025, it is unlawful for an employer to use an automated decision system (ADS) or selection criteria that discriminate against applicants or employees on a basis protected by FEHA or other state antidiscrimination laws.
Defined as "a computational process that makes a decision or facilitates human decision making regarding an employment benefit," which "may be derived from and/or use artificial intelligence, machine-learning, algorithms, statistics, and/or data processing techniques," an ADS may perform tasks such as making predictive assessments about an employee or applicant; measuring skills, dexterity, reaction time or other abilities or characteristics; screening resumes for particular terms or patterns; and analyzing facial expression, word choice, and/or voice.
Pursuant to the regulations, employers must provide notice to applicants and employees when an ADS is used in employment decision-making.
Employers also must maintain all relevant employment records, including ADS data and documentation, for at least four years.
Relevant to any claim of violation of the regs or available defense "is evidence, or the lack of evidence, of anti-bias testing or similar proactive efforts to avoid unlawful discrimination, including the quality, efficacy, recency, and scope of such effort, the results of such testing or other effort, and the response to the results," per the regulations. Accordingly, employers should pre-test any ADS used to confirm that its use will not yield biased results.
To read the regulations, click here.
Why it matters: California has already been focused on the issue of AI in the workplace, with state lawmakers considering the "No Robo Bosses Act," which would prohibit automated decision-making for employment decisions. While the bill continues to make its way through the legislature—it passed the Senate in June and is in committee in the Assembly—employers should familiarize themselves with the new regulations, which take effect October 1, 2025. A growing number of jurisdictions are regulating the use of AI in employment-related decisions, including Colorado, Illinois and New York City.
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