Take action to avoid the risks of AI

How should you manage artificial intelligence in the workplace? NICOLA GRAY offers some advice

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Artificial Intelligence is rapidly transforming the modern workplace, offering employers powerful tools to improve efficiency, decision-making, and competitiveness. However, alongside these opportunities come important risks that employer organisations must carefully manage.

Employers need to be aware of the key benefits and challenges of adopting AI in the workplace to make sure they make informed and responsible decisions.

Standout benefits include:

1. Increasing efficiency and productivity as AI systems can automate repetitive, time-
   consuming tasks like data entry. By reducing manual workloads, employees’ time can
   be freed up to focus on higher-value, strategic activities.
2. Enabling enhanced decision-making by using AI tools to analyse large volumes of
   data quickly and identifying patterns that may not be immediately visible to human
   analysts.
3. Providing cost savings through automation and improved efficiency to reduce
   operational costs over time.
4. Improving the employee experience where AI can support employees in their work
   through the use of intelligent assistants, learning tools and workflow automation.
5. Providing a competitive advantage if the organisation can successfully integrate AI to
   innovate faster and respond more effectively to market changes.

However, employers need to take care to manage the risks of using AI in the workplace too. The Data Protection Act 2018 (Code of Practice on Artificial Intelligence and Automated Decision-Making) Regulations 2026 came into force on 12 May.

It requires the Information Commissioner’s Office to issue a code aimed at providing clarity on how
employer organisations should handle personal data when using AI tools in areas including
recruitment, performance management and workforce analysis.

In practical terms, employer organisations using AI must ensure their systems comply with UK data protection laws and where automated decision making is used, for example in recruitment or performance management, employers must implement adequate safeguards.

These regulations reinforce that employers remain fully responsible for AI-driven data processing and must embed data protection principles and human oversight into the design and deployment of such
technologies.

Where employers use AI in selection decisions, for example during recruitment, they need to
be cautious of inadvertently acting on bias which may expose the organisation to discrimination claims.

AI systems can unintentionally perpetuate or amplify biases present in the training data it is based upon. Recruitment tools can favour certain demographics due to historical data and need to be “trained out” of potentially discriminatory patterns.

Employers should therefore conduct regular audits and use diverse datasets to reduce this risk and ensure decisions involve an adequate degree of human review.

Employers should also avoid an over-reliance on technology where this could be counter-productive to progress.

An excessive dependence on AI can reduce human judgement and critical thinking leading to poor decisions if AI outputs are incorrect or misunderstood.

To maximise the benefits of AI, while managing the inherent risks of the developing tool, we recommend employers:
 Develop clear AI policies outlining the organisations level of “acceptable use” and
responsibilities;
 Ensure transparency with employees about how AI is to be used;
 Invest in training and reskilling to prepare the workforce;
 Implement strong data protection measures;
 Maintain human oversight for critical decisions; and
 Regularly review and audit their AI systems for bias and accuracy.

In conclusion, AI presents significant opportunities for employers to enhance efficiency, decision-making, and competitiveness.

However, its adoption must be carefully managed to address the legal and operational risks come with it. By taking a balanced, responsible approach, organisations can harness AI’s potential while protecting their workforce and maintaining the trust of their employees and customer/service-providers alike.

The risks and rewards of adopting AI within the workplace is the focus of a dedicated free seminar series we’re running this week in Edinburgh, Glasgow, Aberdeen and online.

We welcome all employers looking to learn some practical hints and tips on making AI work for
them and their business.

Nicola Gray is employment partner at Aberdein Considine