As Illinois employers who use AI in employment decisions prepare for new anti-discrimination, notification and recordkeeping requirements beginning January 1, the Illinois Department of Human Rights is drafting long-awaited compliance rules. Indeed, the Illinois Department of Human Rights (IDHR) recently met with stakeholders to propose rules for implementing the new law. How will this big change impact your workplace? Here’s what you need to know about the state’s new employment-related AI law, the proposed rule, and five steps you can take now to prepare.
Quick Review of Illinois’ New AI Requirements
Under the new law, employers will be required to notify applicants and workers if they use artificial intelligence for hiring, discipline, termination, or other workplace-related purposes. Employers are also prohibited from using AI in a way that results in discrimination in the workplace.
The law includes a broad definition of AI and covers a variety of employment decisions.
AI includes any machine-based system that infers how to generate results – such as predictions, content, recommendations or decisions – from the information it receives. The definition also expressly includes “generative artificial intelligence,” better known as GenAI, which is any automated computing system capable of producing results that simulate human-produced content when prompted by human input (think results from ChatGPT, Claude, Gemini, etc.).
Workplace actions covered by this AI discrimination ban specifically relate to recruiting, hiring, promotion, reemployment, selection for training or apprenticeship, termination, discipline, tenure, or terms, privileges, or conditions of employment. You can read more details about the new law here.
Key compliance points in the draft rules
While we await a final version of the rules implementing the new law, IDHR’s current proposal provides insight into how to prepare for compliance. Here are some answers to your main questions.
When is notice required?
Employers are prohibited from using AI “to influence or facilitate” covered employment decisions unless they notify employees and applicants. Examples include:
- Use computer-based assessments or tests (such as questions, puzzles, or games) to:
- Make predictive decisions about a job candidate or employee;
- Measure their skills, dexterity, reaction time or other mental or physical abilities;
- Measure personality traits, skills, attitude or cultural fit; Or
- Screen, evaluate, categorize or recommend potential or current employees.
- Use AI to direct certain job postings or recruiting materials to targeted groups or areas.
- The check resumes for particular terms or models.
- Analyze facial expressions, word choice or voices during interviews.
- Analyze candidate or employee data acquired from third parties.
Are there any exceptions?
Yes. Notice is not required in the following circumstances:
- Use AI for business purposes other than covered employment decisionsfor example to generate text or images for promotional purposes.
- Using an automated computer system that is not considered AI – such as word processing software, spreadsheets or map navigation systems – as long as the technology is not used to make or influence covered employment decisions based on predictions, content or recommendations it creates from the information it receives.
- Leverage an IT system with AI capabilities without actually using these AI features make or influence any covered employment decision.
What information should be included?
The notice must be written in plain language and in a readable format, available in languages commonly spoken by your staff and reasonably accessible to employees with disabilities. It must include all of the following information:
- The name of the AI product, developer and vendor, if applicable
- Covered employment decision that the AI system influences or facilitates (such as recruiting, hiring, or disciplinary decisions)
- The purpose of the AI system, including categories of personal information or employee data collected or processed (such as summarizing or scoring resumes or analyzing video interviews)
- The types of jobs concerned
- A point of contact, such as a hiring manager or HR staff member, who can answer questions about the system and its use
- The right to request a reasonable accommodation and instructions on how to request an accommodation
- Some anti-discrimination remarks linked to AI the Illinois Human Rights Act (775 ILCS 5/2-102(L))
When and how should notice be provided?
Current employees must receive notice on an annual basis and within 30 days of the adoption or substantial update of AI tools used for covered employment decisions. Job offers must also include this information.
Employers will be required to provide notice in all of the following ways, where applicable:
- in any employee handbook, handbook or policy document;
- in a conspicuous place on any construction site where notices are customarily posted;
- in a prominent location on any intranet or external website where you typically post notices to employees and applicants – with a clear link on your website home page; And
- in any job notice or posting.
How long should records be kept?
The proposed rule adds AI-specific records to existing retention obligations for employers, labor organizations, and employment agencies. Notices, publications and disclosures regarding the use of AI under the Act, as well as records of such use of AI, must be kept and retained for four years.
What’s next?
Please note, these rules are proposenot final. A few employer advocates argue that general reporting and recordkeeping requirements are too burdensome for small businesses and could hinder their ability to use AI-based recruiting and human resources tools. All affected employers are encouraged to review the proposal and submit comments to the Illinois Department of Human Rights.
So, these requirements could change, or if implemented as is, they could become binding as of the law’s effective date, January 1. In the meantime, Illinois employers who use or plan to use AI in their employment decisions should consider taking immediate steps to ensure compliance by January 1.
Employer action plan in 5 steps
1. Evaluate the use of AI: Identify AI tools likely to be covered by the new law and confirm whether AI features are actually used to make or influence employment decisions covered by the law, including recruiting, hiring, promotion, training selection, discipline, termination, or other terms of employment.
2. Create and be ready to post reviews: Ensure that notices contain all of the required information listed above and develop a system to ensure that they are posted in each required physical and online location. Remember annual notices and requirements when new or substantially updated AI tools are used.
3. Prepare for changes to your policies and handbook: Review anti-discrimination, hiring, and technology policies as necessary. You must state your commitment to complying with the new law in your policies, manuals and any other written documents. Work with your legal counsel to develop updated documents for 2026, which may include updating and revising your applications.
4. Audit your AI systems: What better way to minimize risks than to look under the hood and ensure that your workplace AI tools are not unintentionally discriminating against candidates or workers? Consider retaining legal counsel to assist you and benefit from attorney-client privilege protections. You may also want to work with an attorney to develop a list of questions to ask your AI vendors and third-party vendors to ensure you are in the best position to avoid liability.
5. Train your managers: Make sure those involved in hiring and supervision are aware of this new law – including notice, recordkeeping and anti-discrimination provisions – and what your related policies allow and prohibit.
