As California continues to lead in AI innovation, employers are increasingly adopting AI tools for everything from hiring and monitoring to creative workflows. Yet, alongside efficiency gains come mounting legal risks.
1. Regulatory Compliance in California
a. Broad AI Legislation and Transparency Requirements
- AB 1008 (Effective Jan 1, 2025) expands the definition of “personal information” under the CCPA to explicitly include AI systems capable of outputting personal data.
- SB 942 compels providers with over one million monthly users to offer AI detection tools, watermark AI-generated content, and clearly disclose AI outputs.
b. Specialized AI Restrictions
Multiple laws regulate AI in sensitive contexts:
- SB 1120 and AB 3030 govern AI use by healthcare providers and insurers, requiring meaningful integration of clinical judgment and disclosure to patients.
- Laws governing the use of digital likenesses and deepfakes (e.g., AB 1836, SB 926) protect privacy and individual rights.
2. Workplace-Specific Risks
a. Monitoring & Surveillance
- California’s Labor Federation is pushing legislation to limit AI-powered monitoring—especially tracking employees off-duty or capturing personal biometric data—reflecting strong worker privacy concerns.
b. Employment Decision Bias
- Though California has not yet passed AI-specific employment bias laws like in other states, employers should anticipate protections in future bills. NYC’s Local Law 144 already requires bias audits when AI dominates employment decisions—and California may follow suit.
3. Developing a Robust AI Policy Framework
To safeguard against risks in the use of AI, businesses should establish a forward-thinking AI governance framework:
Transparency & Disclosure: Track AI tool uses; ensure AI outputs are labelled and training data disclosures are made public.
Bias & Fairness: Conduct regular bias audits; involve human oversight in decisions affecting employment.
Privacy & Surveillance: Restrict AI monitoring to work-related contexts and communicate clearly with employees.
Legal Oversight: Require vetting of AI-generated outputs; prohibit submission without human review.
Los Angeles businesses stand at the intersection of AI optimism and legal caution. By crafting comprehensive policies that reflect California’s evolving rules, businesses can harness AI’s potential while minimizing liabilities. Will you need help drafting a policy or training module?
Let me know—I’m here to help!
Call 818 579-9996 for a free consultation.
Liat Cohen, Esq.
e-mail: LiatLawpc@gmail.com