AI and HR: the good, the bad and the ugly

Over recent years, AI has steadily been transforming how we work, and HR is no exception. In fact, HR teams are among the biggest AI champions, with two thirds of professionals using AI at work, and reporting it saves them around three hours a week.

But while AI can streamline processes, speed up tasks and generally help a small business be more efficient, it's worth taking a moment to understand what AI can and can't do when it comes to managing your people. After all, getting HR wrong can have devastating business consequences.

The good stuff: where AI can help

Just like HR software such as Breathe, AI is a tool which can really help small businesses thrive by making HR processes more efficient.

Key benefits include:

Saving time: the admin side of managing people can feel relentless, especially if you don’t have a HR function. AI tools can help you put together policy templates, training materials and routine HR letters in a fraction of the time it would take to start from scratch. You can then put the time you’ve saved back into running your business.

Ensuring consistency: AI can quickly apply the same language and tone across all documentation, reducing the risk of accidentally treating employees differently in written communications.

Helping with recruitment. AI can help you think through what a role actually requires, draft interview questions, and make sure you have clear shortlisting criteria. You can also use it to write job descriptions, screen CVs, rank candidates based on skills and experience and draft induction and onboarding checklists.

Providing 24/7 HR support: AI assistants can answer common employee questions such as “how do I ask for annual leave?”, “If I’m sick, what do I do?”, “how do I claim expenses?”

 

The bad: where AI falls short

While that list sounds impressive; it comes with a serious caveat. AI is just a tool and should be used as such. It’s not infallible and because it’s trained on what already exists, it can, and does, produce inaccurate and misleading information. And where HR is concerned that can cause irreparable legal, financial and reputational damage.

Areas of greatest concern include:

Outdated information: AI is built to sound confident, so it’s easy to assume something is accurate when in fact it’s factually incorrect.  Employment law changes regularly and guidance evolves, so if an AI tool is working from information that’s even a few months old, it could give you advice that’s no longer up to date.

Bias and ethical concerns: AI relies on data and information that it’s already been given, so when it’s used in recruitment for screening or scoring candidates, it can inadvertently reflect the kind of bias good HR practice is designed to avoid. There have also been cases of AI hiring tools filtering out the best job applicants for no apparent reason and most recently, Meta has been sued for using AI which targeted workers with medical conditions for layoffs!  Thankfully, this is an area regulators are paying increasing attention to.

Erodes jobseekers’ trust: a report earlier this year found 30% of candidates have dropped out of the hiring process when they discovered an AI-led interview was involved due to concerns around fairness, bias and transparency.

Lack of understanding: HR is all about people management and making sure your team are happy and successfully. AI doesn’t know when an employee is going through a bereavement or that a disciplinary situation has a complex background.  Using AI to apply a boilerplate answer to a nuanced human problem could potentially make things a lot worse. 

Data privacy risks: adding details about an employee, whether it’s their name, health issue or a grievance into a public AI tool raises serious GDPR questions as many tools use inputs to train future models.

Creates a false sense of security:  a policy that reads well, or a piece of advice that sounds good may not be necessarily legally sound or right for your business. There’s also a real risk that using AI too much can stop managers thinking critically resulting in poor decision-making.

Things to think about before using AI for HR

While AI can save you time and help your business be more efficient, remember it is just a tool so use it advisedly.

1. Always verify any information AI gives you. AI tools have a knowledge cutoff and may not reflect recent tribunal decisions, legislative changes, or ACAS guidance updates. Use any information AI gives you as a starting point, and not as the final answer.
   

2. Never input personal data: names, NI numbers, salary details, health information, grievance specifics, none of this should go into a public AI tool.  To put it another way, if there is any information you don’t want published on the internet, don’t use a public AI tool. And even if you decide to anonymise everything first, think twice.
   

3. Treat everything as a first draft:  whether it’s a job description or a policy document, always treat AI-generated HR content as a first draft, not a finished product. Have someone with HR knowledge review anything before it's used.
   

4. Think about your duty of care: if you use AI-generated advice to handle a sensitive situation and the advice is wrong, the business is still liable. " AI told me” is not a legal defence.
   

5. AI is not a substitute for professional HR advice: while it might be tempting to use AI to help with disciplinary, grievance or redundancy situations, these are exactly the situations when you should be seeking professional HR advice. AI won’t be aware of the nuances of the individual situation and crucially it doesn’t know the law. It simply predicts language and fills in the gaps so while the advice it gives might sound reasonable, it may be legally wrong.

   
   

Call us for professional HR support

HR is called Human Resources for a reason. It needs human expertise, human judgement and the human touch to ensure employees are happy and successful. So, while AI is a valuable tool which can save you time and take the effort out of the administrative side of HR, it’s not a substitute for professional support or the empathy that’s needed when situations are complicated.

If you’re ever unsure whether AI has given you the right advice, that’s what we’re here for. Get in touch and we’ll be happy to help.