Diversity hiring no longer valued in HR

AI is being introduced into HR faster than organisations are putting governance measures in place, Mason Hayes & Curran (MHC) has said.

More than half of organisations (55%) using AI in HR do not yet have a clear governance framework in place, an MHC survey of more than 100 professionals shows.

The survey also shows that DEI (diversity, equity and inclusion) has plunged in importance with just 4% citing it as valuable.

Talent attraction

Talent attraction and retention are important to 17%, while employee engagement and culture matter to 20% of respondees.

Leadership development is mentioned by 21%, performance management by 9% and HR technology & analytics by 18%.

Just 31% are very familiar with pay transparency requirements, while 45% are somewhat familiar.

Risk

Because HR teams process large volumes of personal data this can cause significant risk under the new EU AI Act.

The findings suggest AI is being introduced into HR faster than organisations are putting governance measures in place.

Currently, more than half (54%) are piloting AI in HR, with a further 34% reporting active use across HR processes.

When asked about their main concern regarding the use of AI in HR, nearly half (48%) cited the risk of biased or unfair decision-making, followed by data protection and legal compliance risks (36%).

A further 16% pointed to the potential impact on employee trust.

All of this highlights a potential gap between practice and governance, MHC has said.

Pay transparency

Alongside AI concerns, pay transparency remains the most significant regulatory challenge identified by respondents.

And 48% said it is now their organisation’s biggest regulatory burden, ahead of data protection and privacy obligations (31%) and the use of artificial intelligence in HR and recruitment (21%).

Added urgency

The issue has taken on added urgency as Ireland faces delays in transposing the EU Pay Transparency Directive ahead of the 7 June deadline.

Levels of preparedness also vary considerably on the incoming pay transparency legislation.

Only 15% of organisations said pay transparency measures are fully implemented, while almost half (48%) reported that implementation is ongoing.

A further 20% said they were still at the planning stage, and 18% had not yet begun implementation.

Commenting, employment law partner Catherine O’Flynn said: “What the results show is that HR teams are contending with multiple, overlapping regulatory demands at the same time.

“Organisations need to be pro-active about AI guardrails to avoid unnecessary risk in HR activity. Pay transparency is also a live compliance issue for many organisations and there is still significant uncertainty about how it should be implemented in practice.”

The poll was conducted as part of the firm’s sponsorship of the HR Champion Awards. 

Survey results

Which area is creating the greatest regulatory burden for your organisation?

• Use of AI in HR and recruitment  - 21%,
• Pay transparency requirements - 48%,
• Data protection and privacy obligations - 31%.

 What is your main concern about using AI in HR?

• Data protection and legal compliance 36%,
• Risk of biased or unfair decisions - 48%,
• Impact on employee trust - 16%.

How is your organisation currently using AI in HR?

• Actively used in processes  - 34%,
• Piloting or testing - 54%,
• Not using AI - 12%.

Does your organisation have a clear governance framework for managing AI in HR?

• Yes - 45%,
• No - 55%.