Using AI in your hiring decisions? Are you doing it right?

Illinois legislators strike again, this time limiting how employers may utilize AI in their employment decisions. An amendment to the Illinois Human Rights Act, which took effect January 1, 2026: (1) specifically prohibits employers from using zip codes as a proxy for protected classes when screening job candidates, and (2) requires that the use of AI in employment decisions be disclosed to employees, where the use could have the effect of subjecting employees to discrimination on the basis of protected classes, as determined by the Illinois Department of Human Rights (“IDHR”). The Amendment identifies “recruitment, hiring, promotion, renewal of employment, selection for training or apprenticeship, discharge, discipline, tenure, or the terms, privileges, or conditions of employment” as specific employer decisions where the use of AI must be disclosed.

This Amendment also further supports Illinois’ trend towards laws that regulate workplace technology. Illinois also has established the Biometric Information Privacy Act (“BIPA”), which places very strict regulations on how entities collect, use and store personal biometric data, including fingerprints, iris and face scans. In 2019, Illinois enacted the Artificial Intelligence Video Interview Act (“AIVIA”) which required employers to provide advance notice to applicants of its use of AI-enabled video interviewing technology, including notice of how the AI works, what characteristics are evaluated and required consent to be obtained before its use during interviews.

Through the Amendment’s definitions of both AI and Generative AI, the law’s reach may be broader than it appears at first blush. AI is defined as a “machine-based system” that infers from the input how to generate outputs “such as predictions, content, recommendations, or decisions that can influence physical or virtual environments.” Generative AI is defined by the Amendment as an “automated computing system that when prompted with human prompts, descriptions, or queries, can produce outputs that simulate human-produced content.” The Generative AI definition then provides examples of outputs, which are wholly unrelated to employer decisions:

(1) textual outputs, such as short answers, essays, poetry, or longer compositions or answers;

(2) image outputs, such as fine art, photographs, conceptual art, diagrams, and other images;

(3) multimedia outputs, such as audio or video in the form of compositions, songs, or short-form or long-form audio or video; and

(4) other content that would be otherwise produced by human means.

What does this mean for employers? Employers should review hiring, promotion, discipline and training decision processes to identify any use of AI in those decisions. If AI is being utilized at any point, a disclosure must be made to every employee impacted by those decisions. Since the Amendment came into effect on January 1, 2026, employers may already be behind and need to quickly assess which decision processes may implicate the Amendment to ensure compliance. If an employee believes that the use of AI has subjected her to discrimination under the Amendment, she has the same right to pursue remedies as with any other claim of employment discrimination.