Global Companies Increase AI Use in Employee Compensation, HR Management

Artificial intelligence is increasingly being integrated into human resources and compensation strategies, with companies using AI tools to analyze pay data, benchmark salaries, and enhance HR functions. About 22% of companies currently use AI for external pay benchmarking, with 63% considering it, helping promote pay transparency and better market understanding, especially for niche roles. While AI can improve efficiency and augment human talent in HR, experts emphasize the need for ethical implementation focused on empowering employees rather than just automating tasks. However, the rise of AI in workforce decisions also brings significant legal risks, as biased algorithms can lead to widespread discrimination claims under laws like Title VII and the ADA, necessitating proactive audits to mitigate liability. Meanwhile, tech leaders express mixed views on AI's impact on jobs, with some warning that AI could reduce corporate workforces and displace entry-level white-collar jobs, while others caution against alarmist predictions. Overall, responsible use of AI in HR requires careful balancing of innovation with ethical considerations and legal compliance.