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Compliance Risks with AI and Automated Employment Decision Tools

Lawmakers and regulators are increasingly scrutinizing whether AI hiring tools unintentionally perpetuate bias. While these tools can streamline hiring processes, they may pose a compliance risk if they discriminate against certain candidates.

From basic computer screening to advanced AI, various tools are used to evaluate employment candidates. These include resume scanners, employee monitoring software, virtual assistants, video technologies and job-fit algorithms that assess candidates’ potential success in certain positions.

However, these tools can introduce discrimination into the hiring process, which is why legislators at the federal, state and local levels are focusing on AI in employment. Although there is no consensus on what constitutes AI and how it contributes to discrimination in hiring, upcoming laws will aim to address these concerns.

Starting in April, New York City employers are banned from using AI in employment decisions, unless they take affirmative steps to mitigate potential bias. This includes conducting a bias audit of the AI tool, making the tool publicly available and notifying job candidates about its use. Candidates or employees must also be allowed to request alternative evaluation processes if needed.

What is a bias audit?

A bias audit involves having a person or group not involved in developing or using the AI tool review it for potential bias. Further details on what this entails are expected. A main concern is that the AI tool might significantly impact or replace discretionary employment decisions, such as overruling human decision-making.

In these instances, the bias audit must calculate the selection rate for each race or ethnicity and sex category. Then, it must be reported to the Equal Employment Opportunity Commission, where the impact ratio for each category will be calculated. This involves dividing the selection rate by the rate of the most selected category. From there, the average score of individuals in a given category will be compared to the value of the highest-scoring category.

Government responses to AI

Various government bodies are scrutinizing the use of AI and automated tools in employment decision-making. The EEOC has issued technical guidance, warning employers that the use of these tools could violate disability protections under the Americans with Disability Act.

The Department of Commerce has appointed 27 members to the National Advisory Committee, which is the group that oversees AI. The White House has released a blueprint for an AI Bill of Rights, which includes provisions related to employment decisions using AI tools.

The Federal Trade Commission has also issued reports expressing concerns about the use of AI and automated tools in decision-making without human review. The EEOC has issued guidance on the use of AI to assess job applicants and employees with regard to ADA protections. Two pending federal bills would require the FTC to mandate impact assessments of automated hiring systems and algorithm usage.

Several states are taking action

California is proposing draft revisions to expand existing discrimination and employment laws that are related to liability risks for employers and vendors selling or administering automated hiring tools that leverage AI. Colorado, Vermont and Washington have created task forces to study AI. And Illinois and Maryland have enacted laws regulating the tools to some extent, though not as comprehensively as New York City.

When it comes to using AI in hiring, there are a few things to keep in mind. The definition of AI can be broad and unclear. It’s important to understand what constitutes AI use in an automated hiring tool, and your legal counsel can help with this assessment. When using automated hiring decision tools, consider data retention and work with third-party vendors to ensure compliance with any new laws or regulations. Be prepared to address any implementation issues.

Although automated employment decision tools have the potential to improve efficiency, the use of these tools in employment decision-making will soon require transparency and accountability, as well as clear standards for auditing the processes.


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Emily Gooding

Payroll Specialist

Emily is graduating in May with a BA in Business Administration from Lander University. She has gained valuable experience as a payroll intern for BMW. We are so excited to have her on the team and  to see her excel in her role as a Payroll Specialist.

Madison Capps​

Payroll Specialist

Madison received a BS in Psychology from Southern Illinois University in 2019. Since then, she has been working as a supervisor at Starbucks and earning her second degree, a BA in Administration and Accounting, from USC Aiken in the fall. She will be joining us as a Payroll Specialist and a valuable addition to our Paysmart team.

Kristen Wilby

Payroll Specialist

Before moving to South Carolina with her husband, Kristen worked as a Sales & Marketing Specialist for Premium King in Feasterville, PA, where she gained valuable experience in strengthening the brand and generating new business. Kristen also brings to our team several years of professional experience as an Executive Assistant and as an Office Manager, where she was first introduced to payroll. Kristen’s knowledge and her innate ability to establish genuine relationships contribute greatly to the team as we continue to grow and serve our clients.

Meg Whitaker

Payroll Specialist

Meg brings nearly twenty years of professional experience to the team. Most recently, she worked as a Payroll & Benefits Specialist in Centennial, Colorado. She and her husband recently moved back to the Carolinas for his job, and we were fortunate to find her! Before Colorado, Meg worked at CPI Security Systems in Charlotte, NC, for twelve years as a Billing Coordinator and Senior Administrative Assistant. She also gained three years of experience as an HR Assistant for a law firm in Fayetteville, NC. Her expertise significantly adds to our team and benefits our clients as we continue to grow!

Rachel McClaran, EA


Rachel plays a crucial role in developing Paysmart’s core processes and procedures, as well as overall strategy within the company. Rachel graduated from Bob Jones University and is an active member of the Junior League of Greenville and the South Carolina Association of CPAs. Her desire to serve her community has led her to become involved with several nonprofit organizations and to serve as the past Vice President of Finance for the Junior League of Greenville. Outside of the office,Rachel enjoys spending time on the water and traveling with her husband and their two children.

Hina Rogers

Payroll Specialist

Hina joined the Paysmart team in August 2022. She grew up in Portland, Oregon, before moving to Greenville, SC. She earned both a bachelor’s and a master’s degree in education. After college, she represented her alma mater as an enrollment counselor in the Southeast and Western states. She enjoys traveling, road trips, cooking, and quality time with her family. Hina looks forward to serving your company’s needs! 

Sharon Quantrille

Payroll Specialist

Sharon has spent several years in the accounting industry and has completed courses to hone her skills as a Payroll Specialist. Her background as an educator, professional musician, and Human Resources Generalist has contributed to her communication skills, commitment to professionalism, and organizational skills that make her a tremendous benefit to her Paysmart clients and colleagues. A graduate of Bob Jones University with a B.S. degree in Music Education, a Master of Music degree in Piano Performance and a Human Resources Generalist Certificate, Sharon spends her free time gardening, hiking, playing the piano, and spending time with her four adult children.

Haleigh Bates

Payroll Specialist

Haleigh joined our team in May of 2022 as a payroll specialist. Haleigh has over eight years of experience helping personal and small business clients with their financial needs. She received her Bachelor’s Degree from Georgia Southern University. She enjoys spending time with her husband and their three children, Caden, Addie, and Mason.  She likes to go hiking, spend time at the beach, and volunteer at her church in the children’s ministry. 

Courtney Rossello

Payroll Tax Manager

Courtney joined the team at Paysmart Payroll Services in September 2020.  She was raised in Simpsonville, SC, and graduated from Clemson University in 2009 with a bachelor’s degree in political science and a concentration in public administration.  Courtney began her payroll career in 2011 and currently works in the payroll tax department at Paysmart.  She strives to make every client feel comfortable knowing their payroll taxes and tax returns are handled accurately and efficiently.  Courtney is also a volunteer Treasurer for a local middle school in Greenville County.  In her spare time, she enjoys volunteering with special needs children, road trips, and spending time with her two daughters. 

Emily Hargrave

Senior Payroll Specialist

Emily received her bachelor’s degree in music from West Coast Baptist College. Since her college days, Emily has gained nearly 18 years of experience in office operations and project management. Emily joined Paysmart in 2017 and enjoys using her skills to support clients and the Paysmart team.

 At heart, Emily is a small-town country girl from the Midwest but is happy now to call the Upstate home, where she doesn’t have to endure harsh winters. Emily’s favorite ways to spend her free time are reading a good book, challenging herself with puzzles, and doing her best not to kill the plants in her garden.

Julie Shull

Client Success Specialist

Julie is the Client Success Specialist for Paysmart Payroll.  She joined the team as a Payroll Specialist in March of 2020. She received her Bachelor of Science degree from NC State University and earned an MBA from Gardner-Webb University while playing on the GWU women’s tennis team. After starting her career with Wilson Sporting Goods as a Financial Analyst, she took a few years off to raise twin boys until she began working for Greenville County Schools in 2014.  Julie enjoys spending time with her family and outdoor activities.

Brad Detandt

Payroll Administrator

A graduate of Northland International University with a BA in Counseling, Brad Detandt leads the day-to-day operations of the Paysmart team. He is eager to grow the firm’s client portfolio. He brings a diverse employment background in retail, manufacturing, nonprofit ministries, and business development, with
a specialized focus on team development and process improvement. Brad’s professional – and personal – mission is to “Be Great. Serve!” Brad enjoys spontaneous activities and weekend trips to state parks with his wife Miranda and his three children.

Stephen C. Stokes

Managing Partner

Stephen has more than 14 years’ experience working with individuals and businesses to meet their tax, accounting, and payroll needs. He has been the managing partner of Paysmart Payroll Services since January 2009. He is a licensed certified public accountant in South Carolina and Georgia. Stephen is also a member of the South Carolina Association of CPAs, the Georgia Society of CPAs, the American Institute of CPAs, and the Professional Association of Small Business Accountants. He has a bachelor’s degree from Bob Jones University and a master’s degree from Georgia State University. Stephen was born and raised near Atlanta, Georgia and moved to Greenville, South Carolina, several years ago. He enjoys spending time with his wife, Tiffani, and daughters, Madeline and Julianna. He is actively involved in his church and enjoys reading, sports, and other outdoor activities.