New! Ontario Proposes AI Hiring Regulations
The government of Ontario will soon require employers to declare the use of AI in hiring, in an update to the Working for Workers Act. We previously covered the Act’s Right to Disconnect and Pay Transparency requirements. Details of the ban are still to come, but because the intent is to level the field for jobseekers and give them insight into the hiring process, it seems likely companies will be required to track and publicly declare how they use AI to recruit, screen, interview, and grade candidates.
Companies that hire in Ontario and the rest of Canada should be looking at how and why they use AI in hiring. They should also consider writing an AI declaration for their career page, spelling out their practices for candidates.
In this blog we will explore how AI is commonly used in the hiring process, best practices, and how to get started on your own AI declaration.
How is AI Used in Hiring?
Like many fields, AI is a hot topic in the recruiting and hiring space. Every week new startups claim to be able to replace your recruiters with new search tools, and your Human Resources department with generative AI. Unfortunately for those who have bought into the hype, AI just isn’t there yet. But while it can’t replace your human team, it can save them time and help them manage large data sets.
Recruiting and hiring teams use AI to:
- Filter candidate resumes and profiles
- Automate and simplify workflows
- Comb your ATS for patterns and trends to anticipate candidate behaviour
- Score video and audio interviews
- Create job posts, ads, and email templates
Pros and Cons of Using AI in Hiring
AI can be incredibly useful to hiring teams if it is deployed to solve their core challenge: finding enough time to make the right hires. While unemployment is low in Canada and the US, applications to job postings have not slowed down. In 2022, ballooning time to hire and the proliferation of job scams drove candidates to apply to 40% more jobs than they did in 2021. The competition for some roles is so fierce that candidates have turned to using application bots themselves, automatically applying to jobs or even scraping job post keywords and automatically adding them to their resumes before submission.
|Speed up candidate filtering and matching
|Overuse may remove the human touch, affecting the hiring process
|Detailed trend reports for better insights
|Limited ability to assess unconventional candidates or those with non-traditional backgrounds
|Accelerate job post creation and email drafting
|Reliance on biased training data and potential replication of undesirable patterns (e.g., bias in hiring)
Pros of Using AI in Hiring
Applicant Tracking Systems and AI powered search tools that can detect keyword stuffing, fake profiles and unnatural applicant behaviour, and filter large candidate pools down to something more manageable are some of the best ways that AI is being used in hiring. When companies deploy AI the right way, it can:
- Speed up candidate filtering and matching
- Create detailed trend reports to help you understand candidates and your team
- Speed up job posts and email outlining
Cons of Using AI in Hiring
On the other hand, overuse of candidate filtering tools can take the human and intelligent element out of hiring. Finding great candidates requires more effort than matching resume keywords to job post keywords. Sometimes the best candidate might have an unconventional work history, or a resume that doesn’t quite match the job post but is still the perfect fit for the role. Candidates are more than the sum of their certifications and AI cannot intuit how skills irrelevant to a job post may be exactly what your organization needs.
Another weakness of AI is that it is only as good as its training data and its trainer. That is, AI is limited by its creators’ and your team’s biases. While AI hiring tools can quickly filter through a large pool of candidates, they do not do so with any special insight.. They are not “intelligent” AI, but supercharged pattern recognition tools that can replicate patterns you may not want replicated, such as class, race or gender bias. Over reliance on AI may set you back on your DEI goals.
Finally, candidates are increasingly hostile to the use of AI in hiring, both in filtering candidates and in communicating with recruiters and hiring managers. Just as customer service and sales leaders need to be mindful about adopting AI, recruiters and HR teams must be careful in deploying AI. Chatbots are getting better every day but can still deliver inaccurate responses and can seem insincere. Just look to Vanderbilt University having to apologize to students over an embarrassing AI-written letter for an example of how over reliance on AI can go wrong.
How to Use AI the Right Way
Generative AI and chatbots are best used in limited functions, like outlining email copy, generating headline options, and basic Q&As. Communication with candidates should be real communication, especially when they are in the interview stage.
The starting point of using AI hiring tools responsibly is to consider the potential impact on candidates – but having a formal AI policy and declaration can keep your team honest and ease candidate concerns.
Writing an AI Policy and Declaration
Ready to develop an AI policy? A good first step is assessing how your organization is already using AI in the hiring process and any adjacent departments, such as marketing. Review existing HR tools and check in with team members to see if they have experimented with chatbots, image generators, or AI search tools.
Once you know how your team is already using AI, it is time to determine how you want to use AI. Do you want to try every new tool that comes out, or do you want to thoughtfully integrate AI into your existing processes? Hint: it should be the latter!
Your AI policy should consider the needs of your HR team, the attitude of candidates, and the regulatory trends in every region you hire. The needs of your HR team should not trump those of candidates – or vice versa. Your policy should balance capacity building and attracting and retaining great candidates. Treat every part of the equation with weight and dignity.
Like any HR policy, it should be written in clear language and accessible to every member of your team. It should clearly document permissible AI tools and techniques, and a process for assessing new ones. You may choose to include it in your employee handbook.
Your AI declaration should be based on your AI policy but written for a mass audience and published on your website. It should clearly describe how your team uses AI, but it does not need to describe every technique and process that your team uses. For example, you should declare that you are using AI search tools, but you do not need to describe the daily tasks of your sourcing team. Your AI declaration should be hosted on your career site and linked in all your external job posts.
How Canadian Payroll Services Can Help
Canadian Payroll Services is an Employer of Record that hires workers on behalf of international companies. We help you expand your teams in Canada without having to open a local subsidiary or tax accounts. Canadian Payroll Services takes on all in-country onboarding, payroll and compliance requirements – including keeping track of the country’s evolving employment standards. We ensure that you are on-side of Canadian employment and tax laws and share bulletins and resources to help you grow in Canada.
Want to learn more about how Canadian Payroll Services can help with your Canadian compliance needs? Get in touch!