Artificial intelligence has officially entered the hiring process, and many employers are struggling to determine where to draw the line, especially when both employers and candidates are utilizing AI.

Candidates now have access to tools that can write resumes, generate cover letters, prepare interview responses, summarize company research, and even provide real-time coaching during virtual interviews. While these tools can help candidates prepare more effectively, they also raise an important question: Are you evaluating the candidate's skills, or the candidate's ability to use AI?

At the same time, employers are increasingly incorporating AI into their own recruitment processes. AI-powered tools can screen resumes, identify qualified applicants, rank candidates, schedule interviews, and even analyze responses to interview questions. While these technologies can improve efficiency, they also introduce potential risks involving bias, discrimination, privacy, and transparency.

Most organizations have policies addressing confidentiality, workplace technology, and acceptable use of AI by employees. Few, however, have established expectations for AI use during the hiring process.

Establishing Expectations for Candidates

The challenge is not necessarily that candidates are using AI. Many employers recognize that AI has become a standard business tool. The concern arises when AI use prevents employers from accurately assessing critical competencies such as communication skills, problem-solving, technical expertise, judgment, or professionalism.

Consider a virtual interview where a candidate receives AI-generated responses in real time. If the role requires independent decision-making or strong interpersonal communication, the employer may be evaluating the technology rather than the person.

This does not mean organizations should prohibit AI altogether. In some positions, proficiency with AI tools may be a valuable skill. Instead, employers should determine what level of AI use is appropriate and communicate those expectations clearly to applicants.

An AI Interview Policy can help establish consistency, reduce misunderstandings, and protect the integrity of the hiring process. The policy should address whether candidates may use AI-assisted tools during interviews, assessments, written exercises, or application submissions. It should also explain the consequences of misrepresenting qualifications or using unauthorized assistance.

Employers should share these expectations early and repeat them at key stages of the hiring process. The policy can be linked in the job posting or careers site, included in the application acknowledgment, and restated in interview invitations and assessment instructions. Before an interview or skills test begins, candidates should receive a brief notice explaining what AI uses are permitted, what assistance is prohibited, whether disclosure is required, whom to contact with questions or accommodation requests, and the consequences of noncompliance.

Establishing Guardrails for Employers

Employers must also examine how AI is being used within their own hiring practices. Although AI can help recruiters manage large applicant pools and streamline administrative tasks, relying too heavily on automated recommendations can create legal and ethical concerns.

For example, an AI screening tool trained on historical hiring data could unintentionally favor certain candidate characteristics or disadvantage qualified applicants. Automated assessments may also create barriers for individuals with disabilities or evaluate characteristics that are not directly related to job performance.

Employers should establish clear guardrails for AI-assisted hiring decisions, including:

• Human oversight: Ensure qualified HR professionals or hiring managers remain involved in evaluating candidates and making employment decisions rather than relying solely on automated recommendations.
• Bias and discrimination monitoring: Regularly evaluate AI tools for potential adverse impact on protected groups and ensure selection criteria are job-related and consistent with business necessity.
• Transparency: Determine when and how candidates should be informed that AI is being used to evaluate their applications or qualifications, including any legally required notices.
• Data privacy: Establish safeguards for applicant information and understand how third-party AI vendors collect, store, and use candidate data.
• Legal compliance: Review applicable federal, state, and local requirements governing AI-assisted employment decisions, including discrimination laws and requirements for reasonable accommodations.
• Vendor accountability: Evaluate third-party hiring technologies before implementation and periodically review their performance, limitations, and compliance practices.

Even where no AI-specific law exists, employers can be held liable for discriminatory outcomes under existing employment and privacy protections, which makes transparency, testing, and oversight essential. For more on the evolving regulatory landscape, see ASE's article, "A State-by-State Guide to AI Governance."

Creating a Fair and Transparent Hiring Process

An effective AI Hiring Policy should address both candidate and employer responsibilities. It should define acceptable uses of AI, establish consistent evaluation standards, identify when human review is required, and provide a process for addressing concerns or requesting accommodations.

HR professionals should work closely with legal counsel, IT, and hiring managers to ensure policies reflect the organization's recruiting practices and evolve alongside changing technology and regulations.

By establishing clear guidelines for both candidates and employers, organizations can protect the integrity of their hiring process, reduce potential risks, and build greater trust with applicants.

ASE Connect

Download a sample AI Candidate Interview Policy.