AI in the Workplace: Regulating Explainability and Consent in Algorithmic Management

Automated systems are currently used to assign tasks, monitor employees, evaluate employee performance, and make managerial decisions. Thus, algorithms replace and augment traditional employer functions. Through the collection of vast amounts of data about employees and their performances, large portions of the managerial decision-making process can be automated. The protection of workers’ rights in the deployment of automated systems in employer functions requires that workers understand that such systems are used and how they are used. From this perspective, the chapter analyses how explainability in automated decision-making and worker consent to the use of algorithmic management are addressed in the existing and proposed legal framework regulating algorithmic management. The chapter argues that, given the imbalance of power in the employment relationship, consent is not a suitable legal ground for automated decision-making in algorithmic management. Further, it argues that the potential for protection of workers’ rights found in the General Data Protection Regulation is underutilised. This potential has been clarified by the recently issued judgment SCHUFA Holding (Scoring), where the European Court of Justice provided some guidance on the scope of the prohibition of automated decision-making under Article 22 GDPR. Consequently, pending the entry into force of rules promoting explainability in the Artificial Intelligence Act and Platform Directive, the GDPR can be used to achieve greater understanding of automation used in algorithmic management.