Artificial Intelligence in Hiring: Diverging Federal, State Perspectives?

The Trump Administration has swiftly rolled back Biden-era protections related to artificial intelligence (AI) in federal hiring practices. On January 20, 2025, President Donald Trump issued an executive order (EO) that revoked Biden’s EO on the safe and trustworthy development and use of AI. On the same day, Trump introduced another EO aimed at reforming the federal hiring process to prioritize skills, experience, and commitment to the U.S. Constitution over factors like race, sex, or religion.

Three days later, Trump signed EO 14179, which mandates federal agencies to review and roll back existing AI policies and regulations. In response, agencies like the U.S. Equal Employment Opportunity Commission (EEOC) and the U.S. Department of Labor retracted their guidance on AI and workplace discrimination. Despite the revocation of federal guidance, employers must still comply with current federal, state, and local laws when implementing AI.

State legislators have taken a contrasting approach, introducing or passing legislation to mitigate AI’s potential discriminatory impact in employment practices. New York City’s Local Law 144 requires annual independent bias audits for automated employment decision tools. Other states, including California, Colorado, Illinois, Maryland, New York, Texas, and Virginia, have proposed or enacted similar laws to protect jobseekers from AI-related discrimination.

Employers must navigate the complex intersection of technology and employment law to avoid liability. Federal protections, such as Title VII of the Civil Rights Act of 1964, remain in place and apply to AI in recruiting and hiring processes. Additionally, case law is evolving, with courts unlikely to allow companies to avoid liability for AI-driven decisions. Companies must stay vigilant, comply with relevant laws, conduct impact assessments and audits, and provide ongoing training to ensure legal compliance and address potential biases in AI algorithms.

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