On October 30, 2023, President Biden issued an “Executive Order on the Safe, Secure, and Trustworthy Development and Use of Artificial Intelligence” to address the growing concerns surrounding the use of artificial intelligence (AI). The 111-page document identifies several areas of concern with the use of AI, including labor, competition, cybersecurity, education, health, and privacy. The order not only calls on federal agencies to work collaboratively, provide more guidance, and conduct training, but it also urges agencies to develop principles and best practices to mitigate the harms and maximize the benefits of AI for workers.

Here are some of the key directives from the executive order:

• Orders the Secretary of Labor, in conjunction with outside entities such as labor unions, to develop principles and best practices to mitigate the harms and maximize the benefits of AI for workers by addressing job displacement, labor standards, workplace equity, health, and safety, and data collection. Once these best practices are identified, the agencies are expected to adopt these guidelines, to the extent feasible, in their programs. A fact sheet, which was issued before the executive order was released, explains that “[t]hese principles and best practices will benefit workers by providing guidance to prevent employers from undercompensating workers, evaluating job applications unfairly, or impinging on workers’ ability to organize.”

• Orders the Secretary of Labor to issue guidance emphasizing that employers must ensure that employees are appropriately compensated for all hours worked under the Fair Labor Standards Act when using AI tools to monitor or augment employees’ work. Significantly, this marks the first time that the Biden administration has shown any interest in AI-related concerns in the wage and hour context.

• Directs the Chairman of the Council of Economic Advisers to produce a report regarding AI’s potential impacts on the labor market, and directs the Secretary of Labor to submit a report identifying options for strengthening federal support for workers facing labor disruptions caused by AI.

• Directs the U.S. Department of Justice to increase coordination with federal civil rights offices on AI and algorithmic discrimination issues, “improve external stakeholder engagement to promote public awareness of potential discriminatory uses and effects of AI; and develop, as appropriate, additional training, technical assistance, guidance, or other resources[.]”

• Instructs the Director of the National Science Foundation to “prioritize available resources to support AI-related education and AI-related workforce development through existing programs.”

• Encourages the Federal Trade Commission to consider whether to use its existing authorities, including the agency’s rulemaking authority, “to ensure fair competition in the AI marketplace and to ensure that consumers and workers are protected from harms that may be enabled by the use of AI.”

• Creates a White House AI Council to help coordinate the efforts of the various agencies to ensure the effective formation and implementation of policies related to AI, including those contained within the executive order.

The executive order puts the onus on the federal agencies to achieve the goals articulated for them. Most agencies will have anywhere from 30 to 365 days to fulfill their respective requirements as outlined in the document.

Even though the executive order is largely focused on the federal workforce, private entities are still affected. For example, companies that develop (or intend to develop) AI tools for the federal government are required to provide the government certain information, reports, and records. Additionally, the executive order leverages the federal government’s pocketbook, as one of the largest purchasers of technology, to ensure the compliance of private companies. These federal procurement procedures provide a method for federal agencies to regulate AI indirectly.

The new executive order continues the approach the Biden administration initially laid out in its “Blueprint for an AI Bill of Rights” in October 2022 and Executive Order 13985, which directed agencies to combat algorithmic discrimination and enforce existing laws to protect rights and safety. The new executive order is also the byproduct of continued cooperation with many leading AI companies. In 2023, the White House announced that it had secured voluntary commitments from 15 of the leading AI companies to control the risks posed by AI.

The new executive order also reflects the Biden administration’s “whole of government” approach to aggressively promote a pro-union agenda across the entire spectrum of the government. This “whole of government” approach has relied on executive orders, interagency task forces, councils, interagency agreements, individual agency actions such as rulemaking and enforcement strategies, attempts to influence Congress, and a variety of other means to achieve a pro-union agenda. The new executive order continues this approach. Most notably, the fact sheet that was released before the executive order identifies the dangers of increased workplace surveillance, bias, and job displacement and then explains that mitigating these risks must involve supporting “workers’ ability to bargain collectively.” One of the eight “guiding principles and priorities” of the executive order is explicitly pro-union: “The responsible development and use of AI require a commitment to supporting American workers. As AI creates new jobs and industries, all workers need a seat at the table, including through collective bargaining, to ensure that they benefit from these opportunities.” In addition, the executive order’s fact sheet emphasizes that the Biden administration’s response to the risks of using AI entails instructing agencies to develop principles and best practices to mitigate the harms, including if AI tools impinge “on workers’ ability to organize.”

Because the executive order urges agencies to develop AI principles and best practices, employers should stay alert to new guidance and regulations that could affect business operations.