Author: Rick Bell

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Why ‘Ban the Box’ Doesn’t Work for Employers or Employees

Listen this clip from Ear Hustle (a podcast about “the daily realities of life inside prison shared by those living it, and stories from the outside, post-incarceration”), and then let’s chat about “ban the box.”

Last month, the 5th Circuit Court of Appeals upheld an injunction which blocked the EEOC’s guidance on criminal background checks is unlawful, and banned its continued implementation or use.

That injunction is significant for many reasons, not the least of which in that the EEOC’s guidance opined that employment applications that ask whether an applicant has ever been convicted of a felony violate Title VII on their face. Why? Because African-Americans and Hispanics are incarcerated at a rate significantly higher than whites.

The movement against employers asking this question on job applications is called “ban the box” — cleverly labeled after the “box” applicants are asked to check if they’ve been convicted of a felony. Nationwide, 35 states and over 150 cities have adopted these laws.

So what’s wrong with laws that are intended to give those with felony convictions in their background a chance at getting past the application stage of their employment search? The laws don’t work.

As illustrated in the Ear Hustle clip above, all that “ban the box” accomplishes is moving the criminal background check from the application stage to the formal background check stage. Employers that are pre-disposed not to hire felons are not going to hire felons. They will just ding them later in the hiring process — after the expense of a formal criminal background check. These laws aren’t changing employers’ minds or attitudes; they are just giving felons false hope.

Moreover, according to two recent studies, ban the box laws are causing more racial discrimination by improving the hiring prospects for Caucasians, while making them worse for African-Americans and Hispanics.

Thus, if ban the box laws either create a more damaging reliance on unconscious racial biases (as these studies suggest) or push the consideration of criminal backgrounds to later in the hiring process, where employers will still use them to disqualify candidates (albeit with higher transaction costs in the hiring process), why do we have them?

If ban the box laws aren’t working toward their intended results of opening job opportunities for ex-cons, then what should we do to achieve this laudable goal? I suggest a three-pronged approach:

    1. Job training within the prison system to provide the incarcerated with transferable real-world job skills and a certification they can provide to a prospective employers upon their release.
    2. Tax credits to incentivize businesses to hire these felons.
    3. A privilege from negligent hiring and other liabilities for employers that hire certain felons for certain positions (i.e., we still don’t want sex offenders working in schools, but they might able to work in a manufacturing facility if they are otherwise qualified and sufficiently rehabilitated).
We need something to break the cycle of crime, and that something is jobs. Stable employment and steady income will help stem recidivism and keep people from returning to crime as a means of support. If ban the box isn’t working toward this goal, then local, state and federal governments need to abandon ban the box and look for other solutions to this problem.
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No, FMLA Does Not Grant You License to Threaten Your Co-workers

Jon Hyman The Practical Employer

After being harassed by co-workers, Paul Ellis took to Facebook to air his grievances publicly.

Among his comments was one that could be perceived as a threat violence: “he’s gonna have an accident on the dock.” When another employee brought a printout of the post to their employer, FedEx, an investigation began. During that investigation Ellis admitted that one could perceive that comment as a threat. As a result, FedEx fired him.

Prior to his termination, Ellis frequently took leave under the FMLA to receive treatments for his chronic back pain and to take care of his sick mother. He alleged that FedEx retaliated against him for his use of FMLA leave by terminating him.

The 3rd Circuit Court of Appeals disagreed.

Ellis cannot demonstrate a causal link between his FMLA leave and his termination. He consistently used FMLA leave for two years without issue. Each time he called out sick, his supervisors covered his shifts, and each year that he applied for recertification, FedEx approved. It also actively accommodated FMLA leave for 42 employees between May 2013 and May 2017 at the Delanco service center.

Instead, FedEx terminated Ellis because it concluded he violated the company’s prohibition on workplace violence. He admitted to his supervisors that his Facebook message could be perceived as threatening, and he was fired shortly after the investigation concluded.

Many employees who engage in protected activity (such as taking FMLA leave) mis-perceive that their jobs are bulletproof. Nothing is further from the truth.
Yes, employers need to be diligent when firing an employee who has engaged in some form of protected activity. But, if you would fire the employee absent the protected activity, and have consistently done so with others under similar circumstances, why give an employee a free pass?
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New Study Says Age Discrimination Remains a Persistent Issue for Employers

Jon Hyman The Practical Employer

Insurance company Hiscox just released its 2019 Ageism in the Workplace Study [pdf], which revealed some sobering statistics about the growing problem of age discrimination for American employers.

  • The number of age-related discrimination charges filed with employers and the EEOC by workers aged 65-plus doubled from 1990 to 2017.
  • 44 percent of employees report that they or someone they know experienced age discrimination in the workplace.
  • 21 percent report they faced age discrimination themselves.
  • 36 percent feel their age has prevented them from getting a job since turning 40.
  • 26 percent feel there is some risk they could lose their current job because of age.
  • Only 40 percent who experienced age discrimination filed a charge or complaint.
  • Employers paid $810.4 million to settle age discrimination charges filed with the EEOC between 2010 and 2018 (excluding litigation).

These numbers are only going to get worse. By 2024, workers age 55 and older will represent 25 percent of the nation’s workforce, with the fastest annual growth rates among those aged 65 and older. Indeed, according to the Hiscox survey, 67 percent of surveyed workers age 40-65 plan to continue to work after they turn 66.

This trend is not without its cost to employers. Age discrimination hurts employers, and I’m not just talking about the $810 million paid in settlement costs.

  • It demotivates employees, which can hurt productivity, customer service, and product quality.
  • It causes a loss of talent and institutional knowledge, due to experienced workers leaving from a stalled career or hostile environment.
  • It causes employers to miss the opportunity of hiring and retaining workers who possess knowledge, experience, good judgment, and commitment to the job.

So, how can an employer help prevent age discrimination from permeating its workplace? The EEOC, in its State of Age Discrimination Report, published last year to commemorate the 50th anniversary of the ADEA, offers the following five suggestions.

1. Leadership needs to create and foster a workplace culture that is committed to a multi-generational workplace where all workers can grow and thrive, which extols ability and reject discriminatory stereotypes and words.

2. Employers and employees must recognize and reject stereotypes, assumptions, and remarks about age and older workers, and treat them no differently than stereotypes, assumptions, and remarks about sex, race, disability, national origin, religion, or other protected classes.

3. Companies should work to increase the age diversity of the workforce by hiring, retaining and engaging employees of all generations,

4. Businesses should implement recruitment and hiring strategies that avoid age bias by seeking workers of all ages and not limiting qualifications based on age or years of experience. These strategies should include training recruiters and interviewers to avoid ageist assumptions and common perceptions about older workers, assessing interviewing strategies to avoid age bias, and having an age-diverse interview panel for prospective employees.

5. Employers should develop retention strategies to keep older workers. I’ve written about this point before, which you’ll find here.
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Diversity Consultants Are Healers, Not Magicians

I was on the phone with one of my favorite colleagues debriefing a recent client engagement.

We’d done a series of focus groups for an organizational assessment and we’d gotten some fantastic data and comments.

“They’re such a great client!” my colleague exclaimed. I enthusiastically agreed.

That exchange got me thinking about great clients. What makes them “great” to work with? And what are the consequences when a client isn’t “great”?

Consultants are here to serve clients, yet we are most effective when clients help us help them. Being a “great client” doesn’t just matter when working with diversity consultants — it matters in engaging any external partner for leadership development, organizational strategy or change management. However, sometimes those leaders engaging diversity and inclusion consultants are less experienced in how to work with external professionals.

What makes clients great to work with — and more successful afterwards as a result — are the following three behaviors:

Trust the consultant. Clients who are unable or unwilling to be fully transparent inhibit the consultant’s ability to serve them and do an excellent job. Even pre-contract intake conversations are confidential, and an ethical consultant will ensure their client’s data, documents and personal disclosures are kept private. If you’re wary, have the consultant sign a non-disclosure agreement, but just as full honesty with your physician is critical to receiving the best health care, full transparency with your D&I consultant is critical to properly diagnosing your problem and getting meaningful results. Avoid keeping secrets from your diversity consultant even if they portray your organization in a less-than-flattering light.

Work at least as hard as the consultant. The consultant will eventually leave, and you will stay behind. Ultimately, you are the owner of the problem you have hired the consultant to help solve. Just as it’s up to you to follow your physician’s advice and change your behaviors to improve your health, you are responsible for implementing solutions and creating results that matter for your organization. Involve the right people in meetings with the consulting team, and enlist the right internal people to take on tasks. Follow up on action items by the agreed-upon deadlines. Communicate changes in priorities or key personnel to the consultant, as well as crises that arise during the project. Make it easy for the consultant to do their job well by executing critical functions they can’t, such as internal communications, scheduling and on-site logistics. It’s a waste of time, talent and budget to not ensure proper building access, fill focus groups, or brief stakeholders on the project goals.

Follow the consultant’s advice. Great clients hire excellent consultants because they need expertise they don’t have in-house. The fields of diversity and inclusion, organizational development, coaching and others require years of study and practice. When a consultant uses their expertise to provide recommendations, great clients often ask for clarification or provide necessary pushback. But just as a patient may not get good outcomes if they ignore a health practitioner’s advice, a client who does not heed their consultant’s expertise will not get the best results. Just as in health care, second opinions and questions are welcome, but great clients don’t waste their budget on consultants they plan to ignore or use as a scapegoat.

In short, great clients treat D&I consultants like healers, not magicians. Just like other types of healers, we partner with clients to understand their situation and context, diagnose the problem, co-create a treatment plan and provide support. We can’t do the work for the client just as the physician can’t heal the patient. The patient’s body does that with the right intervention and support. We can’t wave a wand and make the problem vanish, and we cannot fix it for you. Great clients get it, which is one of the reasons they can be so successful after working with great consultants.

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Is It Legal to Dock the Pay of Employees Who Skip a Political Rally Being Held in the Workplace?

Jon Hyman The Practical Employer

Has an employer violated the law if it docks the pay of an employee who skips a speech being given by President Donald Trump in their place of employment?

Over the weekend news broke of a Pennsylvania employer who had an interesting way to influence its employees’ attendance at a rally Trump was holding at their place of employment during the work day. Only pay those employees who show up.

“NO SCAN, NO PAY,” a supervisor wrote to his employees.

While attendance at the rally wasn’t mandatory, the employer told its employees that they would only be paid for the work day if they attended. Otherwise, they had the option to take a PTO day or take the day off excused and without pay.

While it sounds terrible to withhold pay for employees who choose not to attend a political event during the work day, just because it’s terrible doesn’t make it illegal.

Indeed, in all likelihood, there is nothing illegal about this practice. That said, I can envision a few arguments that could give this employer trouble.

1. You might jeopardize an exempt employee’s overtime exemption. One of the cornerstones of the FLSA’s exemptions is that the employee must be salaried. By definition, a salaried employee receives the same predetermined amount of money for each week worked. Employers can jeopardize exemptions by docking employees’ pay for hours or days missed from work. If an employer reduces an employee’s pay for hours or days missed in a week, the employee is not receiving a standard predetermined amount for all work performed during the week, and therefore no longer salaried. If an employee is not salaried, he or she cannot be exempt. Exemptions are bad things to lose, because it would make an employee eligible for overtime. Thus, paying an employee four-fifth’s of his or her salary for a four-day work week might jeopardize that employee’s exemption.

2. You operate in one of the few jurisdictions in which political affiliation discrimination is illegal. “Political affiliation” is not a protected category protected by any federal law. Still there are a few states that protect it under their own anti-discrimination laws. In California, for example, an employee docked because he or she chose not to attend a rally of a politician they did not support would have a cognizable claim for political affiliation discrimination.

3. You’ve violated an employee’s right under section 7 of the National Labor Relations Act to engage in protected concerted activity. Private employers cannot prohibit discussions by and among employees about wages, benefits, and other terms and conditions of employment. Therefore, if employees skip the Trump rally as part of a mass protest over how his policies impact the workplace, then it might be unlawful for their employer to dock their pay as a result.

Legal or illegal, however, you need to ask yourself whether coercing employees’ attendance at a political event is a legitimate business practice. How you answer the question of whether you think it’s OK to try to shape or influence your employees’ votes helps to define the kind of employer you are. Voting is an intensely personal choice. I don’t think it’s my business how my family members cast their votes.

I certainly don’t think it’s an employer’s business how its employees cast their votes. Voting booths have privacy curtains for a reason. Exercise some discretion by not invading that privacy of your workers.
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Venture Capital Funding Frenzy Over HR Technology on Record Pace

If you haven’t started your own super-successful HR technology company it’s not too late.

Venture capitalists’ love affair with HR tech firms is on track to break records as they dole out millions of dollars to entrepreneurs who promise to transform the human resources landscape. According to HRWins by LaRocque LLC, venture firms invested $1.741 billion in HR tech companies in the first quarter of 2019 and $1.448 billion in the second quarter.

The first quarter alone was “significantly more than any quarter in 2018, and $677 million more than we tracked in all of 2017,” according to LaRocque. And Jason Corsello, founder and general partner of Acadian Ventures, an early-stage venture capital firm specializing in the future of work, predicts that HR tech deals will hit $5 billion in 2019.

The continued investment interest in this space makes sense. Despite years of VC investment into promising HR tech companies, there are still a lot of problems that current vendors haven’t solved, like:

  • How can we recruit strong candidates when unemployment rates are so low?
  • Why does our candidate experience still lag despite our cool new interactive recruiting page, YouTube recruiting channel and automated email response tools?
  • Can I hire freelancers instead of full-time staff, and where do I find them?
  • How are we supposed to reskill an entire workforce when we don’t know what skills they are going to need?

These are big, difficult questions and VCs are eager to support entrepreneurs who claim to have the answers particularly because the market is strong, said David Mallon, chief analyst at Bersin, Deloitte Consulting LLP. “Companies have set aside healthy budgets for the right solution and VCs sense that there is money to be spent.”

TA and Training Lead the Pack

This year’s deals are tipping heavily toward recruiting technology firms. “Talent acquisition is a massive problem in organizations today,” said Corsello.

This year alone Jobcase, a social media recruiting platform for blue-collar workers, secured $100  million; Built In, a Chicago-based tech recruiting and media platform received $22 million; and AllyO, an artificial intelligence conversational recruitment platform received $45  million.

The current spending spree follows at least a half-decade of heady HR tech investment. Funding and deal activity hit new highs in 2015, with firms landing $2.4 billion across 383 deals. That follows similar high rates of investment in 2013 and 2014 alike.

Also read: Venture Capital’s Love Affair With HR Tech Rolls On

This year, start-ups offering solutions to find and manage gig workers are also gaining a lot of attention because “no one has figured out how to manage the entire workforce yet,” Corsello said. He pointed to Jobble, Sense, and Instawork — all gig recruiting platforms that secured healthy VC deals in the past few months. “It’s a huge area of interest.”

Skill development is also a hot area as companies attempt to prepare for the “future of work.” The biggest deal of 2019 is Coursera, the online learning platform that offers degrees and certificates, which secured $103 million in April to push its value past $1 billion. Other learning and development companies are drawing attention and investment, though this space has been less innovative, said Mallon. “We still need a philosophical shift in how we think about developing people before the technology can catch up.”

That’s not stopping VCs from investing in this space, though a lot of these deals still feel like investors throwing money at the problem to see what sticks. Mallon points to past investments in companies offering MOOCs — massive online open courses — and microlearning formats. “It wasn’t because they were so effective as learning tools,” he said. It was about trying new solutions.

And even the biggest deals shouldn’t be seen as proof that this technology will be disruptive. “A lot of companies are still only tackling the easy stuff,” said Chris Havrilla, vice president of HR technology and solution provider strategy at Bersin, Deloitte Consulting LLP. Whether it is high-volume recruiting platforms or chunky content training apps, these tools may solve problems, but they aren’t reinventing the workflow — “at least not yet,” she said.

Mallon believes innovations will come sooner in talent acquisition than in learning and development, and he expects VCs to continue investing across this space.

While not all of these VC investments will pay off, HR leaders shouldn’t be afraid to experiment, added Corsello. He suggests earmarking 20 percent of their budget to pilot new solutions. “You can test software at a relatively low level of risk to figure out what works for you.”

HR tech is in dire need of innovation, which is driving venture capitalists to pour big money into the space. But pure venture capital firms like Acadian Ventures and Andreessen Horowitz aren’t the only ones making these deals. A number of enterprise software firms, including Salesforce, Cornerstone OnDemand, Workday and Randstad, are getting into the VC game, investing millions of dollars into promising start-ups to bolster innovation.

“Most are using it as a hedge strategy,” said Corsello. While these are still venture capital deals and not acquisitions, companies may invest in two or three start-ups with similar solutions to see which ones they may eventually want to acquire. It’s a third alternative to the build or buy model for innovation, he said. “They are taking an ‘invest, watch and acquire later’ approach.”

While some entrepreneurs may balk at investment from a software company, viewing it as an early stage acquisition, it can be a benefit. Corsello pointed to Workday’s recent investment in talent acquisition firm Beamery, which generated a lot of speculation that it was a precursor to an acquisition. “Some companies don’t want to be aligned with a single vendor, but that deal gave Beamery a lot of exposure to Workday’s customers,” he said.

These deals are also good news for companies seeking new innovations to address their talent acquisition, training and employee engagement issues. “All of this interest indicates that there is a lot of innovation happening,” Corsello said. “HR executives should be paying attention.”

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The Law Is a Floor, Not a Ceiling: Granting FMLA for Individualized Education Program Meetings

Jon Hyman The Practical Employer

Last week, the Department of Labor issued an opinion letter [pdf] making clear that covered employers must provide intermittent FMLA leave to eligible employees who need time away from work to attend meetings to discuss the Individualized Education Program (IEP) of the employee’s child.

Rather than discuss the opinion letter in detail, I’ll instead direct you my blogging friends — Jeff Nowak, Suzanne Lucas, and Eric Meyer — each of whom covered this story over the past few days.

Instead, I want to use my space today to make a broader point about the law in general.

According to the National Center for Educational Statistics, in 2017-18, 7 million, or 14 percent of all public-school students, received special education services under the Individuals with Disabilities Education Act. Among those students, 34 percent had specific learning disabilities. Many are on IEPs, and even more are on 504 plans.

What’s the difference? An IEP is made available through the Individuals with Disabilities Education Act, and applies to students with 13 specific disability categories, including, for example, ADHD and autism. 504 plans are more generally available under the Rehabilitation Act and apply to any student with a disability that interferes with the child’s ability to learn in a general education classroom. Both IEPs and 504 plans require a team effort to work. That team always should include the parent(s) or primary caregivers.

Managing a child with special needs is hard. Employment obstacles should not make it harder. A parent shouldn’t have to worry about whether their special needs child is receiving the educational support they need to thrive in school and whether they will have a job when they return from a school meeting.

Bravo to the DOL for applying a common sense interpretation to the FMLA to conclude that attendance at IEP meetings “care for a family member … with a serious health condition,” which is “essential to her ability to provide appropriate physical or psychological care to [her] children.” No employee should have to choose between their family and their job, and this opinion helps ensure these protections.

Yet, with or without the FMLA, all employers should be offering these small amounts of time off. The law is a floor, not a ceiling.

I can hear the protesting cries: “We can’t give every employee time off for every little thing they need. They’ll take advantage of us.”

Seriously? An employee is not taking advantage of you by taking a few hours to meet with the educational team for their special needs child. If you are that worried that an employee is taking advantage of a situation, then deal with that employee.

But don’t deny the time off to all employees just because one employee has taken (or might take) advantage of you. It’s a performance issue specific to one employee. And, if employee leave abuse is a systemic problem throughout your workforce, you should take a look at what you’re doing wrong. Maybe it’s you and not your employees.

Employers, we should be better than this. We have to be better than this. We are better than this.

Don’t do the bare minimum that the law requires. Strive to do more. Make yourself an employer of choice for your employees. You’ll attract and retain better employees who will work harder for you. Don’t just try to reach the floor, but establish your own ceiling.

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Unlimited Paid Time Off Is a Deceptive Ploy in Today’s Workplace

unlimited paid time off

Employees may be lured by the idea of unlimited paid time off but the reality is unlimited paid time off is often an egregious fabrication that employers tell their workforce.

What is usually lost in the conversation is what employees are forced to give up when their organization decides to implement an unlimited system. There are plenty of legitimate business reasons to stop offering — and stop being enamored by — the allure of the unlimited PTO promise.

“It’s great to not have to pay out [accrued vacation] when people leave,” said Maggie Grover, a partner at Wendel, Rosen, Black & Dean LLP in an interview with website HR Dive. “Because people are so connected and working even when they’re technically off, they tend to take fewer full vacation days. So even if you cap a vacation bank at 1.5 or 2 times the annual accrual amount, the payout at the end of the employment relationship can still be significant.” And just to note, not all states require employers to pay out accrued vacation.

Recognizing that this is a large financial obligation, many companies are relieving themselves from these obligations by offering unlimited policies.

Employees also can’t save or accrue “unlimited” vacation time to use next year. When it comes time to transition from the company, the employer has no obligation to pay out the extra hours of productivity that were used in lieu of taking a break.

According to outplacement firm RiseSmart, an unlimited PTO policy “significantly reduces the costs of having to pay employees for unused PTO and may be one of the most compelling factors for companies considering an unlimited PTO policy.”

Unlimited vacation is a work-around, plain and simple. By offering this perk, companies get away from tracking and accruing a liability that in some states, once accrued, is considered earned wages. And once wages are considered earned, they must be paid out at departure or termination.

 Less Time Off for Employees

Some studies show that American employees today often end up taking little or no more time off in an “unlimited” system compared to when they have a set number of days off each year.

In a study by HR platform Namely, research suggests that employees with “unlimited” vacation actually take fewer days off (13) on average than those with a limited number (15).

 Unlimited PTO Is No Win-Win for Today’s Talent 

Unlimited PTO sounds generous on a job description, but employees by and large end up getting paid less with no value attributed to their PTO while companies gain more of their employees’ productivity.

This latest benefits trend is harming the workforce and leading mass groups of employees to forfeit the second most important job benefit with no way to monetize or reutilize the value of their PTO.

Companies need to ask if they’re making these changes for employees or for their bottom line. If, let’s say, employees are using 100 percent of their PTO and a company wants to decrease expenses, then perhaps such a program makes sense. However, this is generally not the case today. Employees thus leave billions of dollars worth of unused PTO on the table.

Are benefits a meaningful way to attract, engage and retain employees? Absolutely.

Will unlimited PTO be a mainstay of the future of work? Absolutely not.

Instead of unlimited, employers — and talent — should be thinking in terms of flexible, diverse and portable benefits to mirror the workforce today.

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EEOC Settlement Teaches Lesson on Extended Leaves of Absence as ADA Accommodation

Jon Hyman The Practical Employer

An employee tells you that he was recently diagnosed with prostate cancer and needs a few weeks off for treatment, surgery and recovery.

Assume either you’re not an FMLA-covered employer or that the employee is not FMLA eligible.

Do you …

(a) Fire him.

(b) Deny the request and force him to quit to have the surgery.
(c) Grant the request, but ask the employee to provide medical information supporting the disability, the need for time off, and an expected return-to-work date.

I hope you picked “c.”

An Atlanta distributor of industrial supplies chose “a,” and it cost them $75,000 to settle an EEOC lawsuit. From the EEOC’s news release:

“Medical leave is a widely recognized accommodation, and in Mr. Smith’s case, could easily have been granted, preventing the firing of a valuable employee. However, instead of accommodating him, Vallen fired him less than 24 hours before his surgery,” said Antonette Sewell, regional attorney for the EEOC’s Atlanta District Office. …

Darrell Graham, district director of the Atlanta office, said, … “An employee should not be forced to risk termination for seeking leave to treat a medical condition, which can be a perfectly reasonable accommodation under federal law.”

Takeaways?

1. Unpaid time off can, and often does, qualify as a reasonable accommodation under the ADA, whether or not the FMLA applies. Moreover, if you fail to consider it as a reasonable accommodation, you’ve likely violated the statute.

2. Firing someone who asks for a few weeks off for cancer surgery is awful. It’s even more awful if you wait until the day before the surgery to do the firing.

3. Given the egregiousness of the violation, $75,000 seems light (although I don’t know all of the particulars of this employee’s damages).

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The Ethics of Artificial Intelligence in the Workplace

communication with artificial intelligence

Artificial intelligence is a branch of computer science dealing with the simulation of intelligent behavior in computers or the capability of a machine to imitate intelligent human behavior.

Despite its nascent nature, the ubiquity of AI applications is already transforming everyday life for the better.

Whether discussing smart assistants like Apple’s Siri or Amazon’s Alexa, applications for better customer service or the ability to utilize big data insights to streamline and enhance operations, AI is quickly becoming an essential tool of modern life and business.

In fact, according to statistics from Adobe, only 15 percent of enterprises are using AI as of today, but 31 percent are expected to add it over the coming 12 months, and the share of jobs requiring AI has increased by 450 percent since 2013.

Leveraging clues from their environment, artificially intelligent systems are programmed by humans to solve problems, assess risks, make predictions and take actions based on input data.

Cementing the “intelligent” aspect of AI, advances in technology have led to the development of machine learning to make predictions or decisions without being explicitly programmed to perform the task. With machine learning, algorithms and statistical models allow systems to “learn” from data, and make decisions, relying on patterns and inference instead of specific instructions.

Unfortunately, the possibility of creating machines that can think raises myriad ethical issues. From pre-existing biases used to train AI to social manipulation via newsfeed algorithms and privacy invasions via facial recognition, ethical issues are cropping up as AI continues to expand in importance and utilization. This notion highlights the need for legitimate conversation surrounding how we can responsibly build and adopt these technologies.

How Do We Keep AI-Generated Data Safe, Private and Secure?

As an increasing number of AI enabled devices are developed and utilized by consumers and enterprises around the globe, the need to keep those devices secure has never been more important. AI’s increasing capabilities and utilization dramatically increase the opportunity for nefarious uses. Consider the dangerous potential of autonomous vehicles and weapons like armed drones falling under the control of bad actors.

As a result of this peril, it has become crucial that IT departments, consumers, business leaders and the government, fully understand cybercriminal strategies that could lead to an AI-driven threat environment. If they don’t, maintaining the security of these traditionally insecure devices and protecting an organization’s digital transformation becomes a nearly impossible endeavor.

How can we ensure safety for a technology that is designed to learn how to modify its own behavior? Developers can’t always determine how or why AI systems take various actions, and this will likely only grow more difficult as AI consumes more data and grows exponentially more complex.

For example, should law enforcement be able to access information recorded by AI devices like Amazon’s Alexa? In late 2018, a New Hampshire judge ordered the tech giant to turn over two days of Amazon Echo recordings in a double murder case. However, legal protections for this type of privacy-invading software remains unclear.

How Should Facial Recognition Technology Be Used?

The latest facial recognition applications can detect faces in a crowd with amazing accuracy. As such, applications for criminal identification and for determining the identity of missing people are growing in popularity. But these solutions also invoke a lot of criticism regarding legality and ethics.

People shouldn’t have to worry that law enforcement officials are going to improperly investigate or arrest them because a poorly designed computer system misidentified them. Unfortunately this is becoming a reality and the consequences for inaccurate facial recognition surveillance could turn deadly.

According to a 2017 blog post, Amazon’s facial recognition system, Rekognition, uses a confidence threshold set to 85 percent and upped that recommendation to a 99 percent confidence threshold not long after, but studies from the ACLU and MIT revealed that Rekognition had significantly higher error rates in determining demographic traits of certain members of the population than purported by Amazon.

Beyond accuracy (and the lack thereof in many cases), the other significant issue facing the technology is an abuse of its implementation — the “big brother” aspect.

In order to address privacy concerns, the U.S. Senate is reviewing the Commercial Facial Recognition Privacy Act, which seeks to implement legal changes that require companies to inform users before facial recognition data is acquired. This is in addition to the Biometric Information Privacy Act of Illinois, which is not specifically targeted at facial recognition but requires organizations to obtain consent to acquire biometric information, and that consent cannot be by default, it has to be given as a result of affirmative action.

As San Francisco works to ban use of the technology by local law enforcement, the divisive debate over the use — or potential misuse — of facial recognition rages on. The public needs to consider whether the use of facial recognition is about safety, surveillance and convenience or if it’s simply a way for advertisers or the government to track us. What is the government and private sector’s responsibility in using facial recognition and when is the line crossed?

How Should AI Be Used to Monitor the Public Activity of Citizen?

The future of personalized marketing and advertising is already here. AI can be combined with previous purchase behavior to tailor experiences for consumers and allow them to find what they are looking for faster. But don’t forget that AI systems are created by humans, who can be biased and judgmental. By displaying information and preferences that a buyer would prefer to keep secret, while more personalized and connected to an individual’s identity, this application of AI technology could evoke sentiments surrounding privacy invasion. Additionally, this solution would require storing an incredible amount of data, which may not be feasible or ethical.

Consider the notion that companies may be misleading you into giving away rights to your data. The impact is these organizations can now detect and target the most depressed, lonely or outraged people in society. Consider the instance when Target determined that a teen girl was pregnant and started to send coupons for baby items according to her pregnancy score. Her unsuspecting father was none too pleased about his high-schooler receiving ads that, in his mind, encouraged his daughter to get pregnant — and he let the retail giant know about it.

Unfortunately, not only are businesses gathering eye-opening amounts of information — many are being racially, economically and socially selective with the data being collected. And by allowing discriminatory ads to slip through the net, companies are opening a Pandora’s box of ethical issues.

How Far Will AI go to Improve Customer Service?

Today, AI is often employed to complement the role of human employees, freeing them up to complete the most interesting and useful tasks. Rather than focusing on the time-consuming, arduous jobs, AI now allows employees to focus on how to harness the speed, reach and efficiency of AI to work even more intelligently. AI systems can remove a significant amount of friction borne from interactions between customers and employees.

Thinking back to the advent of Google’s advertising business model and then the launch of Amazon’s product recommendation engine and Netflix’s ubiquitous “suggested for you” algorithm, consumers face a dizzying number of targeted offers. Sometimes this can be really convenient when you notice that your favorite author has come out with a new book, or the next seasons of a popular show launched. Other times it comes across as incredibly invasive and seemingly in violation of basic privacy rights.

As AI becomes more prominent across the enterprise, its application is a new issue that society has never been forced to consider or manage before. While the application of AI delivers a lot of good, it can also be used to harm people in various ways, and the best way to combat ethical issues is to be very transparent. Consequently, we — as technology developers and manufacturers, marketers and people in the tech space — have a social and ethical responsibility to be open to scrutiny and consider the ethics of artificial intelligence, working to hinder the misuse and potential negative effects of these new AI technologies.

Rob Carpenter is the founder and CEO of Valyant AI, a Colorado-based artificial intelligence company focused on customer service in the quick-serve restaurant industry.