Since we first wrote about California’s regulation of artificial intelligence in employment decisions, the rules are now officially in effect. As of October 1, 2025, California employers must comply with regulations clarifying how the Fair Employment and Housing Act (FEHA) applies to automated decision systems used in hiring, promotions, training selection, and other employment decisions.

What Is an “Automated Decision System”?

The regulations broadly define automated decision systems to include tools that use algorithms, artificial intelligence, machine learning, or similar data-driven processes to assist or replace human decision-making.

This may include:

• Candidate ranking tools
• Resume screening software
• Video interview scoring platforms
• Predictive analytics used in employment decisions

The definition is intentionally broad. If a tool meaningfully influences hiring or employment outcomes, it may fall within these rules.

What the Law Requires

The law does not prohibit employers from using AI. Instead, it makes clear that employers may not use automated tools in a way that results in discrimination based on protected characteristics such as race, gender, age, disability, religion, or other categories protected under FEHA.

Importantly, employers remain responsible for the outcomes of these systems, even when a third-party vendor provides the technology.

Documenting Good-Faith Compliance

Although the regulations are now in effect, enforcement risk is expected to increase as automated hiring tools become more widespread. Employers remain responsible for ensuring these systems comply with anti-discrimination laws.

Employers using automated decision systems should consider:

• Identifying what automated tools are in use and how they impact hiring decisions
• Maintaining meaningful human oversight of employment decisions
• Obtaining vendor information regarding bias testing and compliance practices
• Retaining relevant hiring and system-related records for at least four years

Compliance requires reasonable, documented good-faith efforts. Employers may wish to consult counsel to determine what documentation and monitoring practices are appropriate for their specific workforce and risk profile.

For additional background on the original regulatory framework, review our prior article on California’s AI discrimination law.

Using AI in hiring or promotions? Make sure your technology decisions align with California employment law. Review your practices now to reduce risk, and contact our office if you need guidance.

Using AI in hiring? Review your practices now.
Contact Chase Law Group.

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310-545-7700

_{Please note that this article is for informational purposes only and should not be considered legal advice and does constitute an attorney-client relationship. It is recommended to consult with an attorney directly for specific guidance pertaining to your business and its practices.}