On April 29, the Department of Labor’s Wage and Hour Division (WHD) issued Field Assistance Bulletin No. 2024-1 on “Artificial Intelligence and Automated Systems in the Workplace Under the Fair Labor Standards Act and Other Federal Labor Standards.” The bulletin provides helpful guidance to employers who are presently using or considering using “artificial intelligence” or “AI” in the workplace to assist with managing employees. Likewise, employees should be aware of how the use of AI or other technologies may affect their rights in the workplace. This guidance highlights the fact that employers’ legal obligations and responsibilities with respect to their employees do not change whether or not the employer is employing AI technology in the workplace.
As noted in the guidance, employers are using AI to help with multiple functions, such as tracking work hours, measuring worker performance, setting work schedules, assigning tasks, and performing other human resources functions. They are not only using AI to monitor remote workers, but also employees working onsite. It is important to note that labor laws apply to both onsite and remote workers. It is critical that employers understand the use of AI and other automated systems to perform such functions does not absolve employers from the need to assure compliance with applicable labor law standards.
While the WHD’s guidance is focused on the application of federal labor laws, employers should also be aware of applicable state and local laws when using AI or other technologies. Indeed, the WHD’s guidance to maintain “proper human oversight” of technologies in the workplace is a good general rule to adopt when considering the application of federal, state or local laws. That said, this WHD guidance identifies certain federal labor laws and issues that employers should be cognizant of when using AI in the workplace.
The FLSA
The Fair Labor Standards Act (FLSA) generally requires that covered employees receive compensation at least equal to the federal minimum wage for every hour they work, along with overtime pay when working more than 40 hours within a single workweek. Employers that are using AI and other technologies to assist in the calculation of employees’ wages may not simply rely on automated timekeeping or monitoring systems. Per the guidance, “proper human oversight” of technology is necessary to ensure the accurate calculation of compensable work time.
Employers should not blindly rely solely on systems that predict or auto-populate time entries for workers when determining hours worked and breaks. For example, systems that monitor keystrokes, eye movements, internet browsing, or other activities are not determinative of whether an employee is working. Employers that utilize AI or other technologies to assign work tasks must also be mindful that time spent waiting for a task remains as compensable work time. Further, automated systems that compute hours worked based on an employee’s time spent at a particular location may miss compensable work time offsite or between worksites.
Bottom line, the guidance makes it clear that regardless of the technologies used, employers must maintain “proper human oversight” to ensure accurate they have records and correctly compensate employees for all time worked.
The FMLA
The Family and Medical Leave Act (FMLA) provides eligible employees with job-protected leave for qualifying family and medical reasons. Employers are also using AI and other technologies to help administer employee leaves pursuant to the FMLA. As with the FLSA, employers must exercise responsible human oversight of such technologies, or they risk violating the law. Employers are ultimately responsible for ensuring FMLA compliance, regardless of the technology employed.
AI or other technologies that process leave requests, track time off, calculate leave entitlements, or evaluate whether leave is for a qualifying reason create legal risk for employers, unless they are used in conjunction with responsible human oversight. Compounding the risks of blind reliance on technology is the fact that a technological error could result in systemic violations. Also, certifications from employees to support the need for leave pursuant to the FMLA often require nuanced and careful consideration as to the content of information requested and the time to provide such certification. An unmonitored automated system exercising these functions poses serious risks to an employer. In addition, employers must be careful when using AI or other technologies that those systems are not targeting FMLA leave users for adverse actions or discouraging FMLA usage.
In sum, employers utilizing these technologies must closely monitor automated processes to mitigate the risk of independent and widespread FMLA violations.
Nursing Employee Protections
The FLSA includes specific protections for nursing employees. Employers must provide reasonable break time for nursing employees to pump breast milk while at work. An employer cannot require an employee to adhere to a fixed schedule that does not meet the employee’s needs. It must accommodate variations in frequency, duration, and timing of breaks based on individual needs. As a result, automated scheduling systems that interfere with this requirement will violate the FLSA. Likewise, an automated system that penalizes a worker for failing to meet productivity standards or quotas due to a protected break would violate the FLSA. Again, employers are ultimately responsible for legal compliance, irrespective of whether they are using assistive AI or other technologies.
The EPPA
Employers must also comply with the Employee Polygraph Protection Act (EPPA), which generally prohibits in most workplaces the use of lie detector tests on employees or for pre-employment screening of individuals. Some AI technologies use eye measurements, voice analysis, micro-expressions, or other body movements to suggest lying or detect deception. Use of such technologies by employers would be prohibited by the EPPA, unless in accordance with a limited exemption.
Retaliation
The FLSA includes an anti-retaliation provision that essentially prohibits employers from taking adverse action against an employee because they complained about an alleged violation of the FLSA. The use of AI or other technologies that results in adverse employment action against an employee because they engaged in a protected activity under the FLSA (e.g., filing a complaint with the WHD about unpaid wages) will constitute a violation of the anti-retaliation provision of the FLSA. Examples of potential violations in the guidance include the use of worker surveillance systems to detect, target, or monitor workers suspected of complaining or cooperating with a WHD investigation, or to predict the likelihood of an employee filing a complaint.
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As employers adopt AI and other technologies to enhance operational efficiency, it is imperative employers also remain mindful of their legal obligations. Without proper human supervision, these technologies can jeopardize employers’ compliance with labor standards, potentially resulting in legal violations. The WHD’s guidance emphasizes that employers remain accountable for ensuring compliance with their obligations under the federal labor laws regardless of their use of AI or other technologies.