ICO calls for transparency over AI use by HR functions

The Information Commissioner’s Office (ICO) is urging UK companies to balance the efficiency gains of artificial intelligence (AI) in recruitment with crucial safeguards for fairness and transparency. ICO Executive Director William Malcolm stated that while AI tools could unlock up to £532 billion in productivity for UK businesses by automating tasks such as CV screening, this must not lead to neglecting data protection fundamentals.

The warning comes as a study found that 73% of UK recruiters now use AI in hiring, despite 71% feeling that automation reduces personalisation. Over a third of recruiters also entirely automate candidate rejections, creating a depersonalised experience for job seekers. Malcolm reiterated that automated decision-making must not replace human oversight, warning that efficiency alone is insufficient if candidates feel they are being unfairly assessed or misrepresented.

To aid responsible deployment, the ICO is encouraging companies to use regulatory sandboxes for testing technologies in a controlled environment. The regulator is also developing a statutory code of practice for AI, which will consolidate existing guidance for various industries, focusing on transparency, human oversight, and accountability. Malcolm stated that the ultimate goal is to ensure AI enhances recruitment processes without undermining trust and that organisations remain accountable for the decisions their systems make.

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