AI in the workplace: a guide for businesses

The labour market is transforming due to the rise of algorithms and artificial intelligence ('AI'). As predicted by the Dutch Central Planning Bureau, these technologies are not only affecting existing jobs but also creating new ones, and their overall effects on the workplace are still evolving. In order to effectively use AI within your work environment, it is important to understand the key elements of using AI in the workplace. Which we will help you with in this blog.


Algorithmic management: what to use it for?

The work sector in which the use of algorithms is currently most common is the platform work sector. This sector in the Netherlands has grown by 65% from 2015 to 2019, with approximately 100.000 people currently employed through platforms. The European Directive on platform work will regulate their working conditions in the near future.  

Algorithms are however also playing a large role in non-platform work, influencing personnel management, recruitment, and selection processes. In the Netherlands, more than 75% of businesses plan to use AI applications in the workplace within five years. This leads to automation of labour management, a phenomenon called 'algorithmic management'. There are two key business activities in which algorithmic management can benefit your business with AI: recruitment and employee management.

1. Efficient recruitment

AI can be used in recruitment processes. It reshapes the hiring practices by making it more efficient. You could rely on AI to filter through applications, predict candidate success, and even conduct initial interviews. This saves time and will in general lead to more accurate matching of candidates to the job requirements, ultimately enhancing the quality of hires.

Note: you must ensure that these systems are free from biases to make fair hiring decisions and to give everyone equal chances. Besides that, you should make sure to adhere to all relevant privacy laws when processing personal data

2. Optimal employee management

AI can also be used for personalised employee training, performance analysis, and predicting workforce trends. This data-driven approach can increase productivity and job satisfaction and can help in identifying skill gaps and improving workforce efficiency. 

Note: you should make sure to adhere to all relevant privacy laws when processing personal data


Preparing for an AI-driven future: what challenges and risk to consider?

The best way to use AI to your advantage, is to take the best of both worlds. AI provides valuable data that can help with business decisions. Blending AI insights with human understanding and experience will create a workplace culture that values both AI data and human intuition and knowledge. This will help with optimal decision-making. To get this optimal result, businesses should update their employees' skills on using AI technologies. This means focussing on ongoing training, especially in digital skills, creative thinking, and being able to adapt to new situations.

Risks and challenges

The use of algorithmic management systems presents both general and sector-specific risks. Systems suitable for a group of warehouse workers may not be as effective for a fast-food restaurant or a web store and will use different data. Understanding these systems and the accompanying risks requires a case-by-case assessment.

Some general ethical considerations to keep in mind when using AI are:

  • Be transparent;
  • Prevent biases within the system; and
  • Keep an human in the loop of the decision-making process.

Maintaining ethical standards is key to building trust among your employees (and customers) and will in principle be a legal obligation under the AI Act.

The human cost of algorithmic management

There are also certain downsides to the use of algorithmic management, on employee level. The use of a purely algorithmic management can:

  • Impact public values and fundamental rights, such as privacy and equal treatment;
  • Increase work pressure (possibly leading to burnout);
  • Decrease autonomy for employees, while the feeling of being controlled increases;
  • Cause inefficiency, distress, and frustration among employees, if the systems interprets the physical world wrong.

Therefore, it is important to find a balance that works for both your business and the employees. Namely the risks of privacy and equal treatment are important to mitigate, establishing a well-written AI policy can help with this.

Furthermore, some AI systems, e.g. systems that enable emotional recognition at the workplace, will be prohibted under the AI Act

Become futureproof

The integration of AI and algorithms in (Dutch) workplaces is not just a technological shift but a cultural and social one as well. While it brings efficiency and new opportunities, it also asks for a careful, ethical approach to ensure a future where technology enhances, rather than undermines, human labour. AI in the workplace is not just a trend but a transformational force. By embracing these technologies responsibly, you can lead your company into a new era of productivity and innovation.

Interested in how to do this in compliance with the AI Act or other (upcoming) relevant data and privacy legislation? Contact us.

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