HR Policy Urges FTC to Drop AI and Privacy Rulemaking

The HR Policy Association submitted comments to the Federal Trade Commission in response to its advanced notice of proposed rulemaking, “Trade Regulation Rule on Commercial Surveillance and Data Security.”

The ANPR specifically targets employee surveillance and the use of AI in the workplace, particularly focusing on the risk of discrimination in using such technologies. 

Our comments note that Congress has not clearly authorized the FTC to regulate in this area: In light of the Supreme Court’s major questions doctrine, reaffirmed in West Virginia v. EPA, it is questionable whether the Commission has the congressional authority to issue broad regulations in this area, which has major social and political implications and major economic and political significance. 

“Any significant rulemaking, particularly one with economy-wide impact, should be clearly authorized by Congress after careful deliberation” our comments note. “Data privacy and artificial intelligence issues are extraordinarily economically significant, exceedingly complex and quickly evolving. New policy should be weighed against the significant benefits of a data-driven economy, including emerging use cases of technology to pursue talent retention through investing in employee career growth, elevate employee voice, drive a positive corporate culture, and enhance the employee and candidate experience.” 

In addition, the comments observe that new regulations promulgated by the Commission would be duplicative and only add to the regulations and laws rapidly multiplying at the local, state, and federal levels, as well as long-established requirements, exacerbating an already confused regulatory environment rather than providing clarity or predictability. It is also doubtful that the ANPR meets the requirements under Section 18 of the Federal Trade Commission Act.

Outlook: While our comments urge the Commission to cease its current rulemaking until Congress has committed to a nation-wide approach clearly granting regulatory authority to the FTC, the Biden administration has meanwhile applied a whole-of-government focus on HR data and AI tools. This includes significant activity by the U.S. Equal Employment Opportunity Commission and the National Labor Relations Board. In other words, we can expect further developments in this area, regardless of legislative activity.