The year 2026 will likely be remembered for its escalating layoffs, a number of them conducted for AI, by AI. New data shows that 59% of managers have used AI to conduct layoffs within their organization, with 58% also adding that the technology figures into their decisions on who to fire as well. Not only does this raise concerns about the evident overreliance on technology, but it also suggests that we are entering a whole new era of legal landmines regarding how and why organizations decide who gets to stay.
A new survey from ResumeTemplates.com asked 1,000 US managers at companies with 501 or more employees a few interesting questions about their approach to layoffs and the role AI plays in the decisions being made today. Not only are 1 in 4 managers using AI’s assistance to make decisions on who should be laid off, but 2 in 5 managers have let the technology make the decision for them, without any human review. At least 17% do so often or all the time.
Allowing AI to make layoff decisions independently is concerning in its own right, but the data also shows that managers use parameters for that decision that can have severe repercussions. About 1 in 3 managers using AI for layoffs ask it to consider employee sick day or medical leave usage, while 1 in 7 have the technology consider the age, all on top of expected performance and attendance. Employees and labor laws have been hard at work trying to combat ageism in the workplace, but the technology appears to have brokered a more lax approach to the matter once more.
Managers are not only using AI to make layoff decisions, but some even give the tech full rein without testing tools for bias or supervising the process. (Image: Pexels)
Managers Are Using AI to Conduct Layoffs, Many Taking a Hands-off Approach to Their Role
The ongoing push for workplace automation shows no signs of slowing down, but the hasty rise of unregulated AI has taken some worrying turns. As with most other departments, management and HR teams have begun to experiment with different use cases of the tech, applying it to a myriad of decision-making processes. This includes hiring and firing. Unfortunately, this shift hasn’t come with training and feedback on the ethics of AI usage, and neither are employees trained on the guidelines that must be kept in mind when utilizing the tech.
The survey found that 2 in 5 managers were never trained to use AI ethically in HR decisions. This should be a natural instinct for those working in the field, but it isn’t always as straightforward. Organizational pressure to adopt and optimize operations can blur some of the boundaries that once governed the workplace, and without corrections on how to maintain certain standards, the approach to tech or workplace values can decline. It is also important to note that about 58% couldn’t confirm if the AI tools being used were tested for bias. This represents a serious lapse in protocol and procedure. Not only is AI being changed with hiring and firing decisions, but the reliance on the tech also comes without the necessary testing, training, or preparation to avoid bias.
Targeting Employees for Taking Sick Leave or for Their Age Isn’t a Fair Process
The use of AI in workplace decision-making is only one part of the problem. The large majority of managers determined who to lay off by placing an emphasis on employee performance and productivity scores, poor attendance, or salary. While this might already push the boundaries of fair layoffs in some regions, AI tools have also been employed by managers to supplement decisions based on data of the employees’ tenure, frequency of sick days or PTO time, and their age. Such decisions go against federal anti-discriminatory laws when they emphasize aspects like race, color, religion, sex, national origin, disability, or age.
Employees reserve the right to legal action if employment decisions are based on these protected factors, as they violate their rights and benefits and result in their dismissal on arbitrary grounds. Many lawsuits have recently accused employers of bias against their ranks, with the incident at Meta the latest to showcase how employees are frustrated with the presence of bias in the workplace, particularly when employers use AI to tag and fire them.
Yes, AI in the workplace is changing how we think and perform our roles, but it is important to ensure that each new instance of technology is installed with rigorous testing, reviewing, and training for its users. It falls to employers to manage how their workforce approaches the technology, as a lapse in management’s approach encourages employees to be careless about their own use of the tech.
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