Excerpt from The National Raw Review Article, Published on May 12, 2025.
As AI continues to reshape recruitment, US companies are increasingly adopting AI tools to streamline hiring processes—from resume screening and chatbot interviews to video analysis and predictive performance modeling. While this technological shift promises improved efficiency, it also presents significant legal and ethical risks, especially when compared to the more comprehensive regulations in the European Union. The EU’s newly enforced AI Regulation, effective since August 1, 2024, categorizes hiring-related AI tools as “high-risk,” demanding strict compliance from companies operating within the EU or using AI outputs in EU territories. Even US companies not based in the EU may fall under its jurisdiction if their AI tools affect EU candidates, making global compliance essential.
In contrast, the US lacks a unified federal framework for AI regulation. Although the Biden administration initially encouraged oversight, President Trump’s January 2025 executive order reversed that direction, eliminating federal agency guidelines and promoting deregulation. Consequently, regulation has shifted to individual states, leading to a fragmented and often inconsistent legal landscape. For instance, Virginia’s proposed High-Risk AI Act was vetoed, creating further uncertainty for US companies using AI in hiring.
Beyond compliance with AI-specific regulations, AI tools in recruitment can trigger violations of broader anti-discrimination, privacy, and data protection laws. US companies must be cautious, as over 20 states have enacted laws governing AI’s role in handling candidate data. These legal considerations are not just theoretical—non-compliance can result in significant penalties. In the EU, fines may reach €35 million or 7% of annual global revenue. With AI adoption in hiring showing no signs of slowing, US companies must take proactive steps: conducting bias audits, securing candidate consent, offering alternative screening methods, and ensuring transparency. Responsible AI use in hiring isn’t just a legal requirement—it’s a critical factor in building trust, protecting reputation, and maintaining fair recruitment practices in a globally connected world.
To delve deeper into this topic, please read the full article The National Raw Review.
